why loyalty matters for restaurants
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Why Loyalty Matters
2 © THANX, INC. ALL RIGHTS RESERVED
~2/3 of restaurant sales comes from just 25% of
customers
62%19%
14%
5%
TOP
2ND
3RD
BOTTOM
69% of loyal restaurant guests haven’t returned in
the last 4 months
SUPER LOYAL REGULARS
AT-RISK
W H A T W E K N O W A B O U T T H E R E S T A U R A N T I N D U S T R Y
M O D E R N R E S TA U R A N T G U E S T S A R E “ P R O M I S C U O U S ”
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W H A T W E ’ R E S E E I N G A C R O S ST H E I N D U S T R Y
• The 80/20 rule is true and becoming more concentrated
• Nearly 70% of revenue comes from just 20-25% of customers – loyalists have other options and are mission critical for same store sales growth
• Millennials (18-35) are the largest spending demographic in US history and a force to be reckoned with
• Millennials spent ~$100B at restaurants in 2015
• Single largest growing spending demographic in US (passed Baby Boomers in 2016) and growing double digits annually
• On average, millennials spend 3+ hours per day on their phone and for 87% of them, their phone is within two feet of them for 24 hours / day
• Email is rapidly becoming a less effective channel
• Email open rates down to 4% (down 20% from a few years back)
• Click rates average 1.7% in restaurants and conversion to revenue even lower
• Poor mobile app ratings degrade overall brand value
• Majority of restaurant/retail apps are <3 stars = brand destroyer among younger demo
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“C U S TO M E R R E T E N T I O N ” I S I N C R E D I B LY P O W E R F U L
F R E D R E I C H H E L D
Bain Fellow Founder of Bain’s Loyalty Practice
a 5% increase in customer retention produces a
100% increase in annual profit
“
”
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B U T M O S T LOYA LT Y P RO G R A M S A R E FA I L I N G
Loyalty program memberships have grown to an all-time high…
2.6B3.3B
2012
2014 +26%GROWTH
Source: COLLOQUY
…But out of 29 loyalty program memberships per U.S. household, 59%(!) are inactive.
59%
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AND EMAIL IS NOT A VIABLE LONG-TERM ENGAGEMENT STRATEGY
AVERAGE EMAIL ENGAGEMENT/CLICKTHROUGH RATE 2015
3.6% 1.7%(RESTAURANT - SPECIFIC)
0%2%4%6%
Q1 2013 Q3 2013 Q1 2014 Q3 2014 Q1 2015
Q1 2013 - Q2 2015 EMAIL ENGAGEMENT/CLICKTHROUGH RATE
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Design and product teams made
up of alumni from leading tech
and data analytics companies
Founded in 2011 in San
Francisco with nearly $10M in
funding from elite investors
W E A R E C U S T O M E R E X P E R I E N C E A N D A N A LY T I C S E X P E R T S …
… W H O D I F F E R E N T I AT E O N R E S U LT S
99% renewals 2-6% same-store sales growth
>500% ROI
Focusing on multi-location
retailers and restaurants with
hundreds of clients in 40+ states
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THANX WORKS WITH 1000S OF RESTAURANTS ACROSS THE U.S.
Watch our merchant partner video testimonials at thanx.com/customers