If you had to choose between gaining 10 new customers tomorrow or seeing 5 regulars this week, which would you pick? Based on sheer volume, it may seem like the 10 new faces equal more sales, but don’t discount the importance of repeat business. In fact, increasing retention by as little as 5% can up your profits from 25 to 125% overall. How’s that for more sales? Let’s dive into how loyalty plays out for your business.
Higher Cost Per Visit
Repeat customers obviously love your staff and your food, and they want to keep their favorite spot open! This translates to bigger orders and bigger checks — up to 67% more than a new customer would spend on their first visit. Your repeat business is also much more willing to try more new, more expensive items; upselling existing customers is 4 times easier than convincing a diner who doesn’t already trust your menu. A good rule of thumb is to aim to keep your revenue stream tapped into 40% new business and 60% repeat customers for the highest returns. =
Word of Mouth
Your customers are one of your best advertisers: 78% of diners say they choose restaurants based on their friends’ recommendations. Invest in turning customers into loyal fans — the experience you create for them will not only bring them back, but will bring in their friends.