Top considerations for hospitality businesses heading into the era of personalisation

The start of 2023 has been particularly difficult for the hospitality sector, with rising inflation forcing consumers to cut discretionary spend. In fact, more than half of UK consumers have cut back on non-essential spending, with nearly two-thirds choosing to reduce the amount they eat out. As such, in the contest for customers, competition has never been more fierce. 

With summer fast approaching, now’s the time many in the industry are looking to maximise customer retention as a way of curbing the impact the cost-of-living crisis continues to have on their businesses. 

One of the key ways hospitality businesses can bolster customer retention is through enhancing the customer experience via personalisation. This might mean sending targeted communications, tailored towards individual customers and based on their preferences. Indeed, personalisation can go beyond digital communications and enhance the customer experience in a multitude of ways – from enhancing the booking process to augmenting the in-restaurant experience.

Not only does personalisation increase marketing response rates and booking conversion, it also builds trust and strengthens customers relationships – which are key to driving retention. 

So, what’s the secret to unlocking the potential of personalisation? Well, it starts with data. 

Diner data is everywhere

For brands wanting to personalise the customer experience, a first step is to identify current, and potential, data sources. In a restaurant business, first-party customer data can come from many sources – from digital bookings, online behaviours and loyalty schemes to take-away orders, customer experience feedback and data obtained through Wi-Fi. Once the data sources have been identified, it’s then about matching them together to create a true, 360 view of a diner’s activity. 

Some brands in the sector are already rising to the occasion and are maximising their potential for data collection. For instance, Pizza Express’s cross-channel loyalty program enables members to earn rewards through its supermarket products, restaurant dining, and delivery and collection takeaways. Together, this customer experience will strengthen many customer relationships with the brand, which in turn will boost retention. 

Stitching together a full view of a diner’s behaviour requires time and expertise, but once developed, this holistic representation of each diner can be activated with marketing technology to deliver personalised experiences. 

However, technology alone isn’t the complete solution.

People and processes 

As we all know, in hospitality, people are everything. As is having the right processes in place to provide great, consistent service standards. Delivering personalised experiences is no different. 

For businesses wanting to offer a personalised experience which goes beyond purely digital communications, training staff is fundamental. The skills needed to manage a restaurant differ to those needed to provide a data-driven personalised experience. 

Let’s imagine a high-value customer arrives at the restaurant. The data shows that this particular customer orders the same bottle of wine every time they visit. Yet, the data also reveals that the last time they dined at the restaurant, there was a disturbance and they haven’t visited for a few months. To re-ignite that customer’s loyalty, the restaurant manager could offer the customer and their guest a free glass of their favourite wine.   

Thoughtful, personal, gestures like this are becoming crucial to strengthening customer relationships. It’s what sets restaurants apart from the competition. Yet, much needs to happen to make it possible; the customer needs to be identified, the restaurant alerted, and the right customer insight put in the hands of staff. Then, the serving staff must know how to manage the situation and what levers they have to pull to enrich the guest’s experience. This is a mixture of again, technology, but also (and crucially) training and process. 

Solid foundations to grow to new heights

Loyalty isn’t earned in the same way it was 20 years ago. Pioneering restaurant chains in the industry, combined with technological advances, have proven that homogeneous in-situ experiences are a thing of the past, and delivering personalised on- and offline customer experiences are possible. 

It’s time for others in the industry to step into the era of personalisation. Yet, customer data must be the foundation which drives effective personalised customer experiences.