Quick service restaurants (QSRs) are projected to grow at CAGR 3.11% in terms of revenue between 2014 to 2019 (Technavio). With the increase in revenue comes an increase of competition among individual restaurants. An effective way to stand out as a QSR is bettering digital marketing strategies with SMS. SMS is being utilized by QSRs in a variety of different ways from protecting against coupon fraud or receiving customer feedback. However, the primary function of SMS for most restaurants is increasing customer database.
Opt-In QSR Customer Database for Opportunity
Virtually every QSR has some sort of mailing list to alert customers of new specials, menu additions, and other in-store promotions. For customers, a lot of these promotions can get lost among the plethora of promotional emails and direct marketing materials.However, the most difficult hurdle to overcome is getting customers to opt-in.
Using SMS provide an easy way to attract opt-ins for a QSR customer database. With a near-perfect open rate, text messages can’t be lost in the sea of competitors’ marketing materials.By establishing an SMS campaign, QSRs can implement a cost effective way to grow and maintain their database. Not only is opting-in via text convenient for customers, it also alleviates the burden on businesses as well. SMS can be integrated in a variety of different CRMs and is extremely cost efficient since messages only cost a few cents each.
Pita Pit Use Case
Recently, 3Seventy had the opportunity to work with Pita Pit to help increase the customer database of certain franchisees. In addition to being an effective way to prevent coupon fraud, our coupon campaign allowed Pita Pit to create a unique coupon that was valid 24 hours after receipt. The success of this campaign was astronomical; the franchisees database grew from 2,000 to 9,000 members in just 6 months.
Mobile Coupons are Highly Effective for Driving Purchases
According to a recent article by eMarketer, “Eight in 10 US adult mobile coupons users will redeem a coupon or code via their mobile device for online or offline shopping in 2015.”
Why You Should Care
If your business is in clothing, retail, electronics, gifts, grocery, restaurant, quick service, office supplies, or any other in-store services, then mobile marketing does and will continue to have an impact on your business. Mobile coupons and other mobile tools have the potential to really support the growth of your business – and a lack of using these tools could be a serious detriment. You can use mobile coupons in a number of ways:
- text message coupons with a simple code (largest possible audience)
- mobile website coupons (slightly smaller than SMS audience)
- mobile coupons inside of a mobile app (smallest audience)
SMS mobile coupons are a no-brainer in my mind. These are the best of all worlds. You can deliver static or unique codes to your customers and prospective customers, include a URL if you prefer to use barcodes, and you can interact with customers directly throughout the process. A SMS coupon code could be a literal 5 to 10 digit code that is entered at check-out in the store or in your online store. If your point-of-sale system (POS) has very long and detailed codes, then you can include a link in the SMS message that goes to a dedicated webpage with a barcode and includes the offer details. I’ve tried it before, and I think it’s the best user experience.
The other thing I like about SMS mobile coupons is the possibility of interacting with a customer. You can send out a quick 1-question SMS dialog with multiple choice answers to figure out which coupon the customer wants the most. Then you’re delivering a highly targeted offer to your customer AND learning about his/her preferences and behaviors. If you integrate SMS into your POS and learn when he or she used the coupon, then you can even follow-up with the customer to see how things went with the purchase. BOOM! That is true customer relationship management.
Mobile Website Coupons can be a little tougher to grab attention, but like SMS mobile coupons can be highly effective. With SMS, you have a contact database so you’re pushing out a message to your customers and driving them to make a purchase. Without the SMS piece, you’ll need to find other ways to drive customers to your website / mobile website to find coupons.
You can use social media and email to drive contacts to a specific landing page on your mobile website where the coupon code is gated, after the prospect fills in contact information a dedicated code is provided. Yes, this does create a barrier to entry, but in the long-run you’ll want to know who is using coupons from your mobile website and gating the code is a great way to find that out. You can leave it open to the public, but then you’re depending upon your POS system to capture that data.
Mobile Coupons in Apps can also be a powerful tool, but the audience size is limited. If your business participates in a mobile app such as Yelp, Groupon, RetailMeNot, or ShopKick, then you are reaching a broader audience – which is great and highly useful. The limitations of mobile apps are technology, pricing and reach. While 92% of Americans own a cell phone, only 68% of those people have a smartphone (Pew Internet Research). That means that your mobile coupons are missing 32% of the population simply due to a technology barrier.
The technology barrier created by smartphone ownership also limits your audience. If you are seeking to reach an older population (over 65) or a less tech-savvy community with limited budgets, then your mobile coupons inside of an app will never be seen.
Depending upon your audience, needs, and technology, any of these tools can help your business. Consider each option and how you want to connect with your customers.
From the National Restaurant Association:
SMS marketing – a short-form version of text messaging – is a powerful marketing tool. But even with open rates approaching 100 percent, and offer-redemption rates of 10 percent to 30 percent, the content of your messages is ultimately what drives customers to come back to your restaurant.
Here are some guidelines to improve SMS Marketing in Restaurants:
1. Watch message frequency and mix. Sending one to two messages a month is the most effective way to stay fresh in your customers’ minds. Boost your effectiveness by alternating incentive blasts (i.e., offers redeemable for discounts) with notification blasts. Incentive blasts bring your guests back into the restaurant. Notification blasts help you build your relationship with guests.Some of the most effective notification blasts:
- Live music schedules for upcoming weekend
- Reminder of upcoming events
- Holiday greetings
- Interesting content on your website or social media
2. Spice up the verbiage. Make the text blast engaging and fun to read. This keeps customers excited about receiving offers from you. Stay consistently creative with the wording and you’ll capture their attention and increase open rates and redemptions.
3. Keep messages succinct. Keep text blasts simple and fun to get your point across. SMS marketing limits you to 160 characters (including compliance language). Use as many as you can, and avoid allowing your ideas to flow into a second message. Succinct messages improve the chances your customers will read and respond.
4. Mix up your offers. You can be spontaneous with the offers you send or cycle through a list of incentives that work well for your restaurant. Having several offers ready to go is handy and can make planning ahead easier. One advantage of SMS marketing is the speed with which offers can be changed and delivered. You can use these messages to get rid of excess food supplies or make room for an upcoming food order, for example. If your food provider runs a special on an item, focus your next blast on that item to take full advantage of the special pricing.
5. Keep incentives exclusive to mobile VIP members. When a customer opts in to your Mobile VIP Club, it’s because they like your restaurant and want to receive future offers. These are your most loyal customers. Providing them with exclusive offers will show them that you are grateful. These loyal customers can also help drive more people to your database by generating word-of-mouth buzz about your restaurant.
6. Incorporate Facebook and your website into the SMS Marketing Campaigns. Pushing customers to your social media pages and website helps you build ongoing relationships and grow your social-media footprint. This will help you reach the maximum number of customers with your promotions and offers, greatly increasing your ROI.
7. Incorporate website links in a SMS Campaign. If you have too much information to fit into a text’s 160-character limit, then link to a website with details. Integrating links not only helps you bring customers to your restaurant in the short run, but helps you track where customers are coming from (if you use tracking links such as bit.ly).
This article was originally posted on Restaurant.org
Mobile payment technology is growing fast as a must-have component in the restaurant business, alongside customer demand for speed, convenience and a willingness to use the technology. While many operators rely on third-party services, some have chosen to develop proprietary smartphone apps in house.
“[Technology] has become a part of everyone’s daily life, and this is just the beginning,” said Kevin McCarney, owner of the 10-unit Poquito Mas restaurant group in Los Angeles, which last year introduced mobile payments and online ordering through a third-party provider.
“We are in the hospitality business, and today our guests use technology to connect to friends, to the world and to us as restaurants,” McCarney said.
That adoption has been swift. Roughly one-quarter of consumers say technology options are important features that factor into their decision to choose a restaurant, according to the National Restaurant Association in its 2015 Restaurant Industry Forecast, published in January.
That was an increase from less than 20 percent the prior year, which underscored that “technology rapidly is becoming an expectation rather than a novelty when dining out.”
NRA research found 9 percent of consumers at least once a week used smartphones or tablets for meal payment, and 26 percent used it at least a few times a year.
Many restaurant brands look for mobile payment solutions that incorporate other services, such as ordering and loyalty programs, including rewards.
The 21,800-unit Seattle-based Starbucks Corp. has more than 9 million My Starbucks Rewards program members, and many have adopted its smartphone app. While Starbucks has become a gold standard in this regard, smaller brands are finding ways to tap into the all-in-one mobile offerings.
In mid-February, Chicago-based Wow Bao, the five-unit fast-casual division of Lettuce Entertain You Enterprises Inc., introduced a branded mobile payment app that includes messaging, online ordering and gift purchases.
“Wow Bao customers can now select a favorite location, buy gift cards, reload gift cards easily and much more with this new version.” Geoff Alexander, managing partner at Wow Bao, said in a statement.
“That rate of digital adoption is more than double where we were at the end of the second quarter,” he noted, adding that big box retailers are generating digital sales of 2 percent to 5 percent, and the big pizza brands are seeing digital sales in the range of 35 percent to 50 percent.
The pizza brands appeal to a younger audience, who are adopting mobile payment technology faster than other demographic groups, according to the NRA 2015 forecast.
“As with most technology-related matters, this sentiment is much stronger among younger consumers,” the NRA noted. “But older generations are starting to increase their usage as well. In addition, people with children under 18 in their households are more likely to say that technology options factor into their restaurant choices.”
Read the full article on Nation’s Restaurant News by Ron Ruggles
Restaurants Are an Unpredictable Business
The hurdles you must jump to achieve success are broad and overwhelming at times. From the local restaurant competition to reputation, customer service to food quality, and even the weather. Getting customers through the door of your restaurant is one of the challenges you face – not to mention return customers and developing loyalty. So how can you compete when your budget is planned around just running the business, and not marketing it? One of the most affordable choices you have is SMS (text message marketing).
3 Keys to Success for Restaurants to Use SMS
On a regular basis, a restaurant owner is likely to be thinking about at least one of these business issues: increasing revenue, reducing costs and improving the company operations and culture. SMS (text messages) can be used to support these restaurant business issues.
1.Loyalty and Promotions
The first step is gaining SMS subscribers through texting in or a web form*. In-store promotions are often the most effective means of driving customers to opt-in and join your SMS Loyalty program.
Print posters, window stickers, table tents – or whatever else you usually have out in the restaurant to communicate with customers – and include a short code (shortened phone number) and keyword with a tempting incentive. A&W Restaurants chose to offer a Free Burger, with some clever stipulations attached to prevent abuse or fraud.
Once a customer has join your SMS loyalty or rewards program, you can do several things to drive further revenue. Ask some questions about food preferences. Send limited time special offers, holiday discounts, and promote your existing offers like happy hour. Announce events, such as live music or special football game watching parties.
>Keep in mind the frequency of messages – sending too many can cause customers to opt-out and possibly be turned off by the over-communication.
>Ask questions that you can use to send targeted text messages later. For example, ask about the kinds of updates the customer wants to receive – special offers, events, new menu items, or all of it.
The old method of collecting feedback on a printed card or receipt has been replaced with a website link, but that is not always so simple. What happens when the customer loses the receipt or just forgets to complete the survey?
SMS addresses the immediacy issue. Being able to text in and reply to a few questions within a few minutes (often while still in the restaurant) will increase your response rates. You can ask the questions completely through texting or send the customer to a mobile website with the feedback survey. And if you are asking the right questions, then you may be able to reduce costs on broken procedures or unpopular menu items.
3. Internal Operations
When it isn’t food or atmosphere being improved, the restaurant staff and their procedures are the next most important to be worked on. Improving restaurant operations and communications allows business owners to reduce costs and improve the culture of the business. This ranges from hiring employees to managing deliveries, internal communications to optimizing menu mix, and improving the overall dining experience.
“Employees use messaging to broadcast alerts, such as when a toxic spill occurs on the worksite or information technology systems are down. Employees text to schedule last-minute meetings or announce date and time changes of events. Employees working off site can give a supervisor or co-worker instant updates on a remote project. And an employee can send a critical message to a supervisor who’s tied up in a meeting without disruption.” (Houston Chronicle)
When restaurants use SMS in the right context, they create a more attractive situation for customers to participate. Customers can derive more value from the instant and accessible channel of SMS, which will often drive them to return to a restaurant.
How is your restaurant using SMS text messaging to grow and retain customers? What mobile marketing strategies have worked best for you? Please share your thoughts in the comments below.
*Be aware of SMS compliance rules about opt-ins
The Truth About Email Marketing
I cleaned out my email inbox this past weekend. Three hours and two coffees later, I had diminished my inbox to one page. Among the discarded emails were a slew of online promotions and coupons, mostly unopened. Many of them were great deals, but I didn’t take the time to read them, so now they sit at the bottom of a cyber trashcan in an obscure corner of the Internet, never to be seen or redeemed.
Text Marketing vs Email Marketing
Email deals and coupons are a good thought, but it is important to note new statistics when planning your promotions strategy. The average open rate for email is 12%, while the open rate for text messages is 97% (CTIA Wireless Association). Why are more people opening text messages than emails? People carry their phones with them everywhere they go, both sending texts and checking email. However, it’s hard to stand out in the clutter of your customer’s email inbox. Streamline your message using a more effective medium with text marketing. You will increase the possibility of coupons being redeemed by offering mobile coupons. Now, more than ever before, restaurants are taking advantage of the great potential of text marketing. It is affordable, fast, effective, and trackable.
A text marketing campaign is also mutually beneficial to a restaurant and its patrons: the business gains additional revenue and recognition, while customers get coupons or other helpful notifications such as event invitations. This relationship builds a positive brand image and, subsequently, customer loyalty for your restaurant.
Are you thinking about ways to improve promotions for your restaurant? Don’t miss out on an opportunity to drive new customers through your doors and expand your brand loyalty. Add text marketing to your current marketing channels to increase coupon redemption rates and restaurant traffic. Be smart about what channels you use to send out marketing messages. If you’re customers have email habits like mine, then they might not be reading yours.
You’re in charge of marketing at your company and you’ve been tasked with identifying how to engage your customers on the mobile internet. What now!? Start thinking about interaction and engagement on a mobile device.
Whether the sole owner of a small business or a VP of Marketing for a Fortune 500 conglomerate, the principals of where to begin with mobile web are the same. You need to identify your customer demographics and see how that demographic is interacting with a mobile device.
In the restaurant industry, for example, consumers use mobile websites while they are on the go and looking for something to eat. They are looking for discounts, turn by turn directions, menus, click to call and ordering capabilities. These will be the deciding factors on whether the customer chooses your business or one of your competitors. So now that we’ve identified what the consumer wants, we can now start our mobile website design.
Mobile website design is very important when putting together your mobile site. If you don’t build a ‘true mobile website’ and merely try to optimize one, you’ll end up providing a poor user experience. Because mobile devices have small screens, the options for them to choose must be very simple and streamlined. A poor user experience in turn causes a higher bounce rate. The bounce rate is the number of people that leave your site before taking a desired action. The more people you convert (or get to take the desired action) the more revenue and more profitable your mobile websites will be for your business.
It’s no secret that in today’s economy consumers are constantly on the lookout for a deal. Fast casual and Quick Service restaurants are losing revenue as dining out has become a luxury for penny-pinching consumers, and the value menu has become king.
What does this mean for mobile marketers? One misconception of QSR and fast casual advertisers is that their key demographic skews low-income with below-average smart phone penetration; therefore, mobile marketing isn’t a fit for their brand. This is simply not true. Mobile marketing isn’t just for smartphone users looking for sexy apps. SMS campaigns offer a highly efficient solution for reaching on-the-go consumers with both feature phones and smartphones.
SMS Coupons for Quick Service and Fast Casual
SMS coupons are one of the best ways to leverage sales and boost transactions in today’s economy. In fact, response rates for mobile coupons are more than 20x higher than for print and direct mail advertising – media that are both favorites of fast casual and QSR advertisers.
Restaurants can take SMS to the next level by incentivizing users via their traditional marketing efforts to opt-in to a mobile club. Customers can join by texting to a short code and answering 2-3 simple questions in exchange for an SMS coupon. The information gathered can be stored in a database and used to push out exclusive coupons and offers based on a customer’s preferences or demographics.
The bottom line is that SMS marketing can be used as a natural extension of fast food brands’ print and direct mail campaigns and is a surefire way to drive revenue and get through to the coveted, and often thrifty, 18-34 year old demographic.
Read the success A&W Franchise had with a SMS campaign.