Restaurant POS Articles

On this site, you will see examples of customer database mailings with response rates as high as 75%. These are exceptional examples, of course. Response rates of 10 to 20% are much more typical. But people often react with skepticism even to those numbers because they don’t understand the difference between customer database marketing and “saturation” techniques such as doorhanging and bulk mail.

Targeted customer database marketing and saturation marketing are both essential parts of a successful restaurant marketing plan. But they are two very different animals—with different purposes.

Saturation marketing techniques (bulk mail flyers and large-scale doorhanging programs) are designed to bring new customers into the restaurant. They target entire neighborhoods or zip codes in the restaurant’s immediate trade area. Because typical response rates for this type of marketing are low (1 to 2% on average), they depend on high volume for success.

Understand that it costs more—7 to 10 times more—to win a new customer than it does to keep an existing one. Your saturation marketing is designed to attract new customers to your restaurant. You use customer database marketing to increase sales to existing customers.

Customer database marketing from a POS targets existing customers. It increases sales by building loyalty, frequency, and order value. Common programs are designed to encourage repeat business from new customers, increase sales to loyal customers, and recover customers who are potentially lost to the competition.

Where saturation marketing depends on volume, customer database marketing depends instead on frequency and consistency. Instead of 5,000 flyers, you may mail 50 or 100 or 300 letters or postcards. Costs, obviously, are much lower, and typical return rates are much higher. A regular program of customer mailings (weekly New Customer mailings, for example, and monthly Frequent Customer and Lazy/Lost Customer mailings) can increase sales by as much as 5 to 15%.

A marketing plan that includes both saturation marketing and customer database marketing—supported by other advertising, promotions, and a great product and service—will produce consistent results.