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Embargo - Reconnecting Hospitality Businesses With Their Customers Post-Lockdown

By Frederick Szydlowski, CMO and co-founder, Embargo

The COVID-19 lockdowns might be a distant memory now– but as we enter the ‘new normal’, businesses in every sector are having to re-evaluate the way in which they operate. The pandemic hit the UK hospitality industry especially hard, with reported losses of £30bn in the second quarter of 2021 alone. And while most hospitality businesses are now open again at full capacity, cafes, restaurants and venues have lost touch with their fundamental base – their loyal customers.

Growing and established businesses alike often prioritise the acquisition of new consumers to expand their customer base. In reality, however, they should expend that focus on their existing clientele. It costs five times as much to attract a new customer than to retain an existing one, and after a long break from regular interactions with their regulars, rebuilding that connection is more important now than ever before.

Putting the spotlight on loyalty

The traditional methods of measuring and maintaining customer loyalty have remained the same for years, and barely differentiate between small and large hospitality businesses. They rely on front-of-house (FOH) staff recognising and engaging with familiar faces, and either old-school loyalty cards or a company-specific app to gain special rewards and promotions. These were already imperfect systems, as they either generate no data for analysing customer behaviour or simply make it extremely difficult to use for end consumers and members of staff – but the pandemic has rendered this approach unfit for purpose.

COVID (among other factors) has led to massive staff turnover in the hospitality industry over the past year, so relying on FOH staff to recognise regulars has become obsolete. And with residual social distancing measures and trepidation about exchanging physical cards (bank or loyalty), hospitality businesses are more disconnected from their customers than ever before. To begin rebuilding the bridges between themselves and their regulars, businesses need to look to smarter, tech-based solutions to the problem of building and maintaining loyalty.

CRM to the rescue

Customer Relationship Management (CRM) platforms like Embargo offer a system for closing the divide between businesses and their customers that can withstand the challenges we have seen in the past few years. Tech-based solutions make it easier for customers to engage with their favourite businesses, offering apps that make collecting stamps for their morning coffee contactless, paperless and simply intuitive whilst ensuring regulars are being rewarded accordingly, driving repeat business and creating that win-win relationship between the business and customer.

The benefits aren’t exclusive to the customer, either. It also provides a platform for the businesses to structure a loyalty scheme, communicate with regular customers and reward them. For the first time businesses can find out who their regular customers are, how many regulars the business relies on and much more. Being data-driven is becoming an essential part of modern commerce, and having more information about who their customers are and being able to communicate with them are more valuable to a business’ longevity than pouring vast sums of money into attracting new customers without knowing if they’ll ever come back.

“See you next time”

Loyalty isn’t an intangible abstract like being memorable or with the times – it is something that can be measured, increased – but also sadly, overlooked. If the hospitality sector is to return to its former capacity and withstand whatever disruption comes next, businesses need to put loyalty first and truly learn who they are dealing with – before it is too late.

About the author

Frederick Szydlowski is the co-founder and CMO of Embargo, a loyalty platform that allows restaurants, bars, and coffee shops to recognise and reward their customers through the use of pioneering technology. Launched in 2017, Embargo is helping hospitality businesses embrace digital transformation by connecting them directly with their customers delivering bespoke loyalty rewards and enabling communication.

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