Restaurant discounts are a source of contention for business owners. Some restaurateurs believe that discounts are a great way to boost customer numbers. If prices are low, more diners will visit and tell their friends.
The truth is, restaurant discounts must be handled with care. Used sparingly and wisely, discounts can boost traffic in your business and increase profits. But if a restaurant’s prices are constantly discounted, it can harm the brand.
The reason for this is simple. Diners do not want cheap prices; they want value for their money. This is a subtle but important difference. If prices in your eatery are constantly discounted, customers could grow suspicious. They might assume you are desperate or that your full prices are deceptive.
We are not saying that you should never run restaurant discount campaigns. Discounts can bring diners into your business. From there, you can charm them into returning, ideally with friends. Just learn how to reduce prices without diminishing your brand’s reputation.
When Not to Run Restaurant Discount Campaigns
Some restaurants may never need to run a discount campaign. If a restaurant has a loyal and dedicated customer base, it can rely on steady income.
Loyal diners may even be deterred by a discount. They may consider their choice of eatery to be reassuringly expensive. If prices are dropped, it can be a cause for alarm. Customers may even wonder if your business is in trouble.
Very few restaurants are in this position, though. Unless you are part of a popular chain or franchise, or located in a small town with very limited competition, marketing will surely be essential.
Discounts can help with this. In the Internet age, consumers are only ever one smartphone app away from finding a discounted meal. If you manage this smartly and successfully, you will increase foot traffic in your restaurant.
How to Run a Restaurant Discount Campaign the Right Way
The most obvious time to run a restaurant discount campaign is when sales are down. This may seem counterproductive at first. After all, you are looking to make more money, not less.
However, a discount can bring new customers through the door. Twice as many customers paying half as much for the meal leads to the same bottom line. You can then work on turning these customers into regulars.
Think of a restaurant discount as speculating to accumulate. You are looking for a fast (but not desperate) way to get customers through your doors. This will be much faster and more effective than simply waiting for word-of-mouth to spread.
There are several key points to this process.
- The offer should be irresistible to customers. Consider offering a significant discount, such as 50% off your traditional menu prices.
- Make sure the reason for this discount is clearly communicated in your marketing. Do not make your customers suspicious. Most of the time, if something looks too good to be true, it probably is.
- Market hard, without being intrusive. Use social media and feel free to piggyback on popular, trending hashtags.
- Make the discount time-bound and limited. Scarcity always makes an opportunity more appealing. If a discount comes with a ticking clock, customers will flock toward it.
- Get something in return. Encourage customers to sign up for a loyalty card or mailing list when they enjoy their discount. This way, you will have a captive audience for future marketing campaigns.
Let’s take a look at each of these points in more detail.
The first, and most important, point is making it clear why your business is running a restaurant discount campaign. The restaurant trade differs from traditional retail. Eateries do not run seasonal sales at the same time every year.
One way to tempt people into your restaurant is to say that you are trying out a new menu and would love to hear people’s views. This will automatically spark customers’ interests. Not only are they getting discounted meals, but they have the opportunity to shape the future of a business. Everybody loves to feel like their voice is being heard.
This can also be tailored into your marketing campaigns. For example, partnering with Snappmeal can help bring more visibility to your restaurant’s promotions. Just remember to build your campaign around the reasons for your discount, not the discount itself. Becoming identified as “the cheapest place in town” can be toxic for a restaurant’s brand.
If you can, offer a loyalty card or sign-up program. Customers love these tools. It makes them feel like they are part of a community. In addition, you can tie future discounts into a loyalty program. This is a way to protect the reputation of your brand while also providing discounts to regulars. Using a loyalty card makes customers feel like they are part of a small, exclusive club.
The importance of keeping these discounts time-based is also critical. Choose the most impactful time possible for your promotion. Is your restaurant usually quiet on a Monday? Use a discount promotion to get people through the door on this day. Customers will not be innately suspicious of a discount on this day. Most restaurants will enjoy more trade on a Friday or Saturday night than a Monday.
Remember, this is all income that you would not have enjoyed otherwise. The promotion encourages customers who would otherwise have stayed away to instead spend money with you. You can then turn this to your advantage. Impress new visitors and turn them into loyal customers. Around 10% of regular diners will spend more with you than 90% of casual, occasional visitors.
Be patient about expecting this loyalty. Approximately 37% of customers need to visit a business at least five times before they consider themselves loyal. This means that you need to keep tempting people back. This is why taking their contact details such as an email address is important. A constant dialog will build a relationship and ensure that customers look forward to your restaurant’s discounts.
Teaming up with an experienced business can help you run successful, time-based restaurant discount campaigns. If you’d like to know more about how Snappmeal can help you with this, don’t hesitate to get in touch.
Remember the golden rule of discounting: a restaurant discount should be impactful and occasional. Constant discounts cheapen and reduce trust in your brand.