Is customer loyalty still a thing in hospitality?

Many in the industry say no – that rising costs, changing consumer habits, and the rise of “experience-chasers” mean fewer repeat visits and more one-off diners. One bad review or a cheaper option down the road, and that loyal regular is gone.

But we don’t buy into all that doom and gloom!

Loyalty isn’t dead, it’s just different

According to a report by Zonal and CGA at NIQ, a price increase makes 37% of customers less likely to return, but less likely does not automatically mean they’ll never return again. In fact, according to KAM Insights, value for money matters far more than price, with good (and that means consistently good) service, atmosphere and getting something that can’t be replicated at home being the key drivers of customers’ perceptions of value.

What’s that? You’d like an example?
Story time:

For a recent birthday celebration, one of our team was looking for:

– A child and dog friendly pub or informal restaurant

– Centrally located between us (let’s say a 10 mile radius)

– A ‘pop-in/pop out’ set-up (i.e. flexible on times and number of guests) for a Sunday daytime.

We’d shortlisted three options with one friend showing a preference for The Coach House in Wooburn Green. I’d been there before and thought it was OK.   Solid.   Nice setting/decor.   Good staff but perhaps a little slow service-wise.   Decent food but not ‘blow-your-socks-off’ great.

I wasn’t 100% on board, but it was a group decision so cool…whatever.

Then she said “Oh, they’ve got this thing going on that weekend, what do you think?” and sent us this in the group chat:

No reservation needed, all welcome (including kids play area), rock up whenever, food and drinks at reasonable prices (that steak and focaccia was £14, a jug of pimms was £15) AND a DJ.

SOLD!

So we went along and had THE LOVELIEST time. Amazing atmosphere (excellent DJ but not too loud – just vibes), the food was genuinely incredible, loads of staff on, all very attentive.

Could I have had that experience at home? Technically, yes. But could I have done it for the £30 I spent (not to mention no planning, no washing up etc.)? OF COURSE NOT!

That experience has taken me from ‘yeah, that place is ok’ to ‘I can’t wait to go there again’.

LOYALTY UNLOCKED.

How to go about building loyalty

Beyond offering that value for money experience, building loyalty (like most marketing) means knowing your audience. That means:

Contacting your customers the way they want to be reached

Is that an e-mail, a WhatsApp message or even a phone call?

I’m an e-mail lover myself (but not too often thanks!) and find messaging a bit invasive. The manager at my parents’ favourite restaurant knows they won’t appreciate either, so she calls them when there is something going on she thinks they’ll like!

Reward loyalty in the way that means the most to them

Personally, I can’t get excited about a free starter or 2-4-1 cocktails. But offer me a free glass of champagne or an upgrade to champagne if I buy Prosecco, and I am in! It’s all about the right reward for the right customer.

Make it easy to benefit from return visits

Those youngun’s love an app and don’t mind sharing their data. That’s an easy way to track their visits AND what they order so offer points-mean-prizes discounts or get really personal with special offers. If that’s not for you, a simple booking system can at least keep you up to date with new versus returning customers.

Loyalty schemes

When it comes to loyalty schemes, 90% of consumers report being open to joining one, but the ones they value the most are the ones that save them actual cash – not surprising with the cost of living still being so high.

Graphic adapted from a report by Zonal and CGA at NIQ

But don’t forget the impact of novelty (and charity!). Loungers have just launched their own loyalty scheme, aimed more at getting regulars to visit their other locations than necessarily returning their local or favourite. £3 (which goes to the local charity partner) buys you a Loungers passport, with visits to different locations earning unique stickers.

For the more competitive consumer, this might mean “challenge accepted” straight away, but for those looking to save, building their sticker collection can mean free drinks, novelty goodies or even free hot drinks for life!

(slightly unfortunate that at the time of writing, the link to the details on their own website is broken…)

What do you think? Is loyalty dead? Are loyalty schemes worth it? What works for you as a consumer?