Is your Restaurant Online Booking System sharing your Customer Contact Details?
Most Restaurant owners understand the importance of their customer database, in fact, for many restaurants, their customer database is the secret sauce to increase customer numbers during the quiet months of the year and the quiet days of the week, but what many Restaurant owners don’t know is that the Restaurant Online Booking System that they are using may be sending out discount coupons to other restaurants in their area. Having your Booking System send out discount coupons to competing Restaurants is a bad idea for a couple of reasons. Firstly, a 50% off coupon decreases the amount of money that a customer is expecting to pay for a meal and secondly it means that your customers are going out to other Restaurants. This is why 50% off coupons to your customers is one of the biggest reasons for decreasing loyalty amongst Restaurant customers.
A Restaurants Customer Database is often the Crown Jewels of the Business. It needs to be protected like the Crown Jewels.
One thing we ask all Restaurant owners to do is to make a booking at their own Restaurant to see what happens. We created a new email account, an email address that is not listed on any Restaurant marketing databases.
We then created a booking using the Dimmi booking widget on the Restaurant’s website. It is a fair assumption that anyone making a booking on the website is a customer that has been driven to the Restaurant’s marketing. Very few visitors come from Dimmi. (Less than 1 in 300 based on our Restaurant Marketing Database, from over 1 million visits to Restaurant websites.)
We received a confirmation email and an email asking us to review the restaurant. Both of these are great. Then things started to go a little off track. The next email invited us to download the Dimmi app. This is not great as it is part of Dimmi’s strategy to control where people make their bookings and which Restaurants they go to.
The next email that we received was the first of many 50% off discounts.
We have blurred the name out of the Restaurant because many Restaurants do not want it known that they are discounting so heavily. The promotions from Dimmi increased in tempo from there.
Sometimes these offers are coming out every 3 days, so it is an incredible number of 50% offers that your old customer receives. There are a number of questions that Restaurants now must ask themselves when using a Booking System that remarkets to their customers:
- Is my Restaurant so good that customers will pass up a 50% off coupon to a competitor?
- How many customers are likely to return once they start getting a continual stream of 50% offers?
- Where will I find new customers to replace the ones who are now waiting for the next Dimmi 50% off coupon?
50% offers are great for customers who are looking for a cheap meal. They are also great for new Restaurants wanting to fill tables quickly and for Restaurants that are struggling. But this list of customers is being built up from the regular and loyal customers who are making bookings on a restaurant’s own website.
Effectively Restaurants are sharing their customer’s contact details with a company that sends out 50% off coupons to their competitors and worse of all they are paying per seat or per table and needing to worry about no shows. Some are even paying a monthly fee for the privilege of sharing their customer database.
We believe that in the long term this will lead to greater churn in Restaurants as the price point that a subset of customers are willing to pay is decreased to a level that is not sustainable for Restaurants. This will mean a new restaurant will come into the market, keen for market share, keen to run a 50% campaign to get their name out there and keen to get some bums on seats and the cycle will go on, with eventually that Restaurant closing because it hasn’t built up a loyal following of customers who are prepared to pay full price for their meals.
It Was sad to see that Book A Restaurant has started just recently this practice as well. We received this email a couple of months ago and we believe that it is one of the first of the 50% of discounts that they are sending out to customers of other restaurants. It may be an amazing offer for diners, but I am pretty sure that the owner of the restaurant doesn’t think it is amazing that he has to offer a 50% of discount to get people to come to his restaurant.
This now clearly leaves Marketing4Restaurants.com and our Free Online Restaurant Booking System as the largest restaurant booking system in Australia, which is free for customers, free for restaurants and never sends out 50% offers from your competitors. This is why it is growing at 8% per month.
Our Free Online Restaurant Booking System is perfect for a Restaurant who:
- Want to take bookings online;
- Want to take bookings 24 hours a day;
- Want to build their database;
- Don’t want to share their database;
- Don’t want to worry about having to reconcile No Shows; and
- Don’t want to pay per seat or per table for each booking.
We believe that paying per seat or per booking is an unfair tax on your marketing. Great marketing should increase revenue, not increase costs.
The number 1 question we get asked is, ‘Why is our Free Online Restaurant Booking System free?’
We don’t think that restaurants should be forced to share their customer details and we don’t think they should pay per seat or per table. That business model is very 2008 and the internet has come a long way since then.
We build a lot of the features for Marketing4Restaurants based on ideas and suggestions from our customers and a free online restaurant booking system was the number one request that we got. We built it in just over 6 weeks and we rolled it out to our customers. Some people without a www.marketing4restaurants.com website also wanted it, so we charged $39 for it. We couldn’t believe that people would actually pay that much every month for something we built so quickly. Over the next 12 months of those customers paying for it, they paid back our development costs and then some, so we decided to give it away free. It is quick and easy to set up and costs us virtually nothing to run, so it is our gift to the Restaurant industry to help with profitability and to help restaurants find new customers and turn them into repeat customers. It is a great way for restaurateurs to start working with the Marketing4Restaurants team and realise that we do things differently and we are actually here to help them.