Top tips to boost customer loyalty schemes

By Sara Hussein

- Last updated on GMT

Technology can help businesses boost revenue
Technology can help businesses boost revenue

Related tags: Customers, Loyalty program

Pubs have lagged behind when it comes to understanding customer loyalty in the past. But with technology, smartphones and personalised rewards they can tap into new and exciting opportunities for their businesses.

1. Make it personal 

Personalisation – the act of catering offers to specific customers based on collecting personal data – has existed in the world of supermarkets for more than two decades, but has been significantly absent in the pub sector.

Tesco’s Clubcard and Sainsbury’s Nectar card are perfect examples: based on the purchases and frequency of visits, supermarkets have been able to tailor specific offers to individual customers as a thank-you note for sharing their data with the brand.

On the other hand, many pubs have communicated with customers by spamming their inboxes with irrelevant emails and, ultimately, pushing them away. Research from Eagle Eye revealed that 25% of UK consumers stopped using loyalty programmes due to the lack of personalisation.

It’s a dangerous move for operators, who risk turning away valuable customers and crucial revenue, especially with the younger demographic – 24% of 18 to 24-year-olds decided to leave loyalty schemes due to receiving excessive generic emails from manufacturers.

2. Online booking systems are the way forward 

Online booking systems can give operators a basic overview of customer data and can create personalised offers based the information available at their fingertips​.

Zonal Marketing Technologies managing director Olivia FitzGerald says: “Lots of big pub brands, such as JD Wetherspoon, have picked up on how important it is to selling those tables efficiently online through a wait-list to check availability. A lot of pub chains can see that it can make a big difference.”

According to a survey conducted by nightlife guide DesignMyNight, 81% of customers wanted to be able to book their table online. Through its latest online booking system, Collins, operators are able to monitor the number of customers who dined in their pub, what they ordered and how much they spent.

Collins_booking_system

DesignMyNight co-founder Nick Telson says: “In the pub industry, it’s about keeping it simple. We do not have a full-on loyalty package, but it’s about using the data that you’ve got to be able to offer some loyalty rewards.

“Birthdays, frequency of visits and the location of the venue can give licensees a good launch pad to actually try customer relationship management (CRM) and see if it works.”

With Collins, some major pub companies have collected more than 60,000 client records, another pub group has seen a 30% increase of people booking online, claims Telson. But most importantly, operators can offer a flexible approach to customer loyalty – something that was unheard of before.

FitzGerald says: “If you rewarded different types of behaviour, you don’t have to subscribe to one scheme. You could have five different segments with different types of rewards and the flexibility is very interesting.”

3. Flexible loyalty schemes 

With a flexible loyalty scheme, operators are opening those personalised rewards to all customers, especially to non-regular visitors, who can be encouraged to spend more than they initially planned and drive more footfall.

‘Surprise and delight’ rewards can turn new visitors into loyal customers. Using the booking system can inform licensees which customers are entering the site and how they can reward
them unexpectedly, say with a free bottle of Prosecco.

The one-off, goodwill gestures can spark that special rapport between operators and customers, bringing a whole new meaning to excellent customer service.

Telson says: “You can get some really good reactions from customers, people aren’t expecting it and they see it as almost a lovely present.

“It’s about making the customer feel wanted, understanding them and applying that product knowledge when you speak to them.”

4. Perks for smaller pub groups 

For smaller pub groups, data collection and understanding customer behaviour is just as crucial as it reflects their personal, one-to-one ethos with customers.

Anglian County Inns (ACI) for example, launched a loyalty card in summer that allows customers to top up their card and receive a 5% on their balance.

Customers can then receive personalised offers in various ACI sites based on their previous purchases and the amount of money they spent. Even with its recent launch, there has been an overwhelming response from consumers.

ACI_loyalty_card

ACI marketing manager Ruth Nye says: “We have been blown away by the reception that we’ve had. In the first month, we almost reached up to 1,000 people using the card and frequently had more than 25,000 transactions during those months, we see those customers coming back a lot, which is excellent.”

She adds: “I think there is a massive opportunity for pubs to be more active in this space. With such a diverse customer base there is a lot to learn and a lot of opportunities to be tapping into.”

However, pubs that are venturing into the digital world tend to be a step ahead of their competitors.

By offering digital rewards that customers can redeem through their smartphones, this can be a gold-mine opportunity for operators to attract customers that belong to the younger smartphone-savvy demographic.

5. Goodbye paper vouchers, hello digital rewards

Eagle Eye’s research shows that 41% of 18 to 24-year-olds wanted to be able to redeem their offers using a smartphone, similarly 59% of 25 to 34-year-olds claimed it was important for them to access their loyalty programme via a mobile device.

Here, licensees can tap into some great rewards with the right customers. As consumers download the mobile app, large pub companies are able to collect and identify customers’ details on their database and can monitor what offers they are entitled to.

Young’s, for example, has recently launched its mobile app, Young’s on Tap, which enables customers to pay their bill through their mobile phone. Operators can push those ‘surprise and delight’ rewards by sending them automatically to customers who are close to a Young’s pub using GPS location.

Youngs_on_Tap

More importantly, digital, as opposed to paper, vouchers are more likely to generate a high return on investment (ROI) as they are assigned to a particular customer whose data is integrated in the till system.

FitzGerald says: “Paper vouchers are prone to all kinds of misuse, there is nothing to prove that a particular person had that voucher assigned to them, it could be anyone redeeming that voucher, there is no way to see real ROI on that.”

She adds: “With vouchers, it can be quite difficult to analyse whether they’ve driven extra business or made a real impact. We want to close the loop by tracking that customer’s journey and see what they did with the vouchers.”

Keeping a watchful eye on how the vouchers were spent means operators can amend their propositions in the future and keep customers on their toes with exciting offers.

However, with all this technological advancements, there is a chance that more traditional, independent pubs, that do not invest as much money and time in technology, risk being alienated. This may not have an immediate effect, but is likely to put a strain on sites that do not have a strong online or digital presence.

FitzGerald says: “Whether you like it or not, there is a whole different discussion taking place online. If you have a pub that’s not really controlling its online presence, you’re still going to have people on social media and posting their thoughts on TripAdvisor.”

While some pubs may not be ready to invest money into technology if it does not fit into their business ethos, it is certainly an investment worth looking into.

Pubs are catching up with the rest of the hospitality sector. Tailored offers, flexible loyalty schemes and digital re-wards are pushing pubs to outperform their competitors by understanding their customers’ tastes and preferences.

Going the extra mile will only hone an already special relationship between operators and clients.

Related topics: Technology

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