• Restaurant Marketing

How to Increase Customer Lifetime Values to Improve Restaurant Revenue

by: Allen Graves
6 min read

As a restaurateur, you understand the importance of gaining loyal guests, ensuring their satisfaction, and turning them into long-time regulars. With costs out of control and labor rates on the rise, regular guests can help ensure business stability.

One of the most effective ways for restaurants to ensure sustained growth and a higher return on investment is by concentrating on increasing their customer lifetime value (CLV). Investing in strategies that increase CLV and boost repeat orders helps restaurants build that all-important guest loyalty.

In a nutshell, in the highly competitive and fast-changing food service industry, CLV is of immense importance to a restaurant’s bottom line and greater profitability over the long haul.

Why? The answer is simple.

The more guests you acquire who keep coming back and spending more, the higher your overall revenue will grow.

Then you can reallocate guest acquisition dollars and apply them to other areas of business improvement, or to offset rising costs.

Here are several ways you can begin improving your customer lifetime values at your restaurant.

increasing customer lifetime value with guest engagement

Identify Your Best Customers

First, guest CLVs can help you identify your ideal guests. The CLV metric assesses guests and can identify those who typically spend the most time and money at your business.

Knowing this helps focus your marketing efforts so that when you do offer things like incentives and loyalty programs, you know who to primarily target for the best possible results.

You’ll find that this concept will be an underlying theme throughout the rest of this article.

Post-Sale Outreach

Restaurants can reach out to both high and low CLV guests after they leave, or after ordering online.

Anything from traditional paper coupons to email and social media marketing can help you create a connection with a guest that encourages future visits and more sales.

Also, making your interaction with the guest feel more personal and less “businessy” is always a plus. With a restaurant customer data platform (CDP) like Bloom Intelligence, you can collect guest contact information automatically.

The platform will create a large database of customer profiles that can be segmented for more personalized marketing campaigns. Segmented marketing campaigns have been shown to have a much higher ROI than blasting a single message to your entire database.

Customer Rewards Programs

Guest loyalty programs are popular with today’s consumers, and smart restaurant owners know this. So when you identify a certain group of your guests who are high CLV, it provides you with an opportunity to reward them for their loyalty.

This kind of reward program is one of the best ways to ensure the retention of such high CLV customers.

Rewards programs don’t have to be elaborate, computerized points systems. They can be as simple as punch cards offering a free sandwich with every 10 purchases.

Another simple way is to utilize your guest WiFi or online ordering system with your CDP to measure guest return visits or orders automatically. Then, with the unified automated marketing platform, have the system email them a coupon or any other offer to redeem on their next visit.

Offering low CLV guests a rewards program in which they can get a discount on a pricey item is a useful way of convincing them to purchase that item later at the standard price – which also represents a form of up-selling.

increasing lifetime value with rewards program

Up-Selling for Better Customer Lifetime Value

Up-selling is one of the most effective ways to increase the value of low CLV customers. In this approach, restaurants try to convince the guest to add more items to their order or purchase a more expensive item than the one they originally ask for.

Up-selling can also mean selling the guest a complimentary product that increases the profit margin on that particular sale. For instance, some guests will decide to upsize their orders by getting a supersized meal instead of the regular one.

And when guests are ordering and you ask them if they “want fries with that”, that’s also up-selling.  Suggesting pairing a wine with a meal or bringing the dessert tray before being asked are also great ways to encourage larger tickets.

Down-Selling for Better Customer Lifetime Value

Despite the fact that restaurants have their prices printed on a menu, patrons will often ask employees what something costs. If they don’t like the answer, they sometimes just walk away.

This is where down-selling can work. Down-selling is a technique where restaurant employees can direct a guest to a lower-cost item they might be more likely to buy.

This approach is very useful for selling to low CLV guests since they are more likely to be looking for bargains. Offering a less-expensive option to these guests means at least some profit, which is better than no sale at all.

Guest Engagement

Obviously, losing high CLV guests and maintaining low CLV guests at their current level of spending would be bad for business. Understanding this makes it possible for you to adjust your approach to both groups by finding new ways to hold on to more profitable guests, while also turning those low CLV guests into bigger spenders.

One of the keys to retaining high CLV customers is guest engagement.

Guest engagement means more than just offering a smile while taking someone’s order. Employees and management must engage with the guest throughout their restaurant experience and beyond.

Also, when patrons feel appreciated – from the moment they approach the host stand to the moment they walk out the door – it makes it more likely that low CLV guests will spend more on their current visit or make another purchase in the future.

Connect Better with Your Guests

Customer lifetime value can also help you adapt to your guests’ preferences to engage them more appropriately.

For example, if a restaurant finds that older patrons have the highest CLV among their guests, this shapes marketing and feedback efforts differently than it would with younger guests, as older generations are less likely to use social media.

In this instance, you might collect email addresses and market to those guests using email, instead of trying to create a large social media presence.

Knowing who your best guests are allows you to cater to them better. It gives you the opportunity to improve your business by capitalizing on the benefits of knowing your high CLV clients.

Typically, these guests are most likely to try new products, tell others about your restaurant, and offer reviews and feedback. Those with high CLVs are the ones whose feedback will provide the most benefit.

engaging with guests to increase customer lifetime value

Study Loyal Guest Visits

There are several ways to improve customer lifetime value numbers, including running promotions, providing perks and loyalty programs, and creating a bigger presence online. What if you’re already doing some of these things but your CLV numbers are still low?

You may need to target your efforts toward one group. Family-friendly restaurants, for example, cater to a broad range of people. Other restaurant analytics tools could indicate the kinds of families to target.

For instance, with a restaurant customer data platform, you can track guest age, gender, new and repeat customers, and more. But these metrics give you a general idea of who visits your establishment. Tracking the demographics of returning guests identifies the people to target when building loyalty to boost your CLV.

There are significant benefits for your restaurant if you understand the CLV of the guests coming into your establishment.

Having these numbers in hand gives you the power to target your guests through engagement, rewards programs, and marketing in a way that can retain high CLV guests and convince low CLV guests to spend more.

Discover the Bloom Intelligence Customer Data Platform

If you are looking for an effective way to improve guest retention and increase your bottom line, then improving customer lifetime values should be a priority for you and your business.

Repeat guests mean repeat profits.

It’s time to start planning for the successful future of your restaurant. Ensuring a positive guest experience and strong guest retention are the secrets.

Using Bloom’s restaurant marketing and customer data platform, you can collect data from many different sources. Then you can leverage the real-time guest insights and campaign reporting to not only get your current guests back through your door but also to attract new guests and keep them coming back.

In a rough economy with rising food and labor costs, guest acquisition and retention are crucial for success.

Click Here to Schedule a Free Online Demo, or call 727-877-8181 to see how we can help you save time and drive tangible results for your restaurants.


Restaurant Marketing FAQs

What is Restaurant Marketing?

Restaurant marketing is the process of getting people to visit your restaurants. Restaurant marketing creates loyalty, provides data to research, analytics, and allows restaurants to gain a better understanding of their ideal customer profile. It utilizes all customer channels: guest WiFi, website, social, rating sites, mobile apps, email, text, and advertising.

Learn More About Restaurant Marketing Here

What is WiFi Marketing?

WiFi marketing is a marketing technique that uses guest WiFi to collect & clean customer data such as names, emails, phone numbers, customer behavior, and demographics. This data is used to personalize marketing campaigns to increase customer loyalty, build online reviews, and save at-risk customers. The performance of every campaign can be tracked down to the tangible ROI of a customer walking back in your door.

Learn More About WiFi Marketing Here

What is Restaurant Reputation Management?

Restaurant reputation management is the process for restaurants to manage customer feedback and creating systems to improve customer experiences, passively build positive online reviews, and save at-risk customers. It is a very important aspect of running a successful restaurant business.

Learn More About Restaurant Reputation Management Here

How Does Bloom Identify and Bring Back Lost Customers?

Bloom Intelligence uses machine learning to identify at-risk customers. When one is recognized, the system will send them a message with an incentive to get them to return and re-establish their visit pattern. Bloom users are seeing up to 37% of churning customers return.

Learn More About Saving At-Risk Customers Here


What our happy customers
are saying

“SaaS that covered so many bases for us instead of having to use multiple software products. Bloom Intelligence has simplified our responses to reviews, customer feedback, and more. I highly recommend Bloom Intelligence.”

Robert Sanderson

“Bloom Intelligence really is a step ahead in terms of marketing software and metrics. Their product is reliable, fast and innovative and has helped the company I work for really grow.”

John Marchetti

“Working with Bloom Intelligence has been amazing. They assist you every step of the way and work with you hand in hand to make sure you are optimizing your advertising potential. We are excited to use this tool to help learn more about our customers so that we can personally engage with them and understand our strengths/weaknesses.”

Ariel Ramirez

“In these challenging times, it has been a pleasure working with Bloom Intelligence to help facilitate our service offering to our clients. They were extremely responsive and provided support to mitigate risk and minimize revenue loss. Great partner!”

Stefan Kim

“We’re extremely pleased with the wealth of customer data that we’re able to gather, at a very attractive price.  In addition, we’re able to communicate our new product promotions by using  the landing page as a digital billboard.  A “no-brainer” for anyone working with limited Marketing $$.”

Bob Cross, Vice President of Operations

Subscribe Here for the Latest Updates

Never miss a post! We'll keep you up-to-date on the latest restaurant and retail WiFi marketing information.

Drop us a line!

We would love to hear from you! If you have any questions, comments or ideas about our restaurant marketing blog, drop us a line and let us know.

Or call us at 727-877-8181.

Contact Us