In more than a decade of developing database marketing software, I’ve never been so excited. Gone are the days of capturing customer data via the fishbowl at the end of the bar or guests signing up to membership programs with pen and paper – a slow and steady approach that would often generate an illegible list of email addresses and little else.
Technology has become more agile and responsive in recent years. It has become far easier for hospitality businesses to capture more data – not only in vast volumes but also rich, actionable insights.
Visit frequencies, transactional data, products purchased and much more now sit behind a customer’s email address, but this increase in available data is accompanied by stronger legislative measures designed to protect consumers.
In a post-GDPR world, it’s no longer a valid (or sensible) strategy to send an email campaign to your list and expect results. There are increasing numbers of businesses vying for your customers’ attention in their inbox and the number of company lists they subscribe to has diminished. On top of that global email opening rates are falling, with the foodservice sector seeing average open rates of only 15.48%. The problem has become one of more data, less engagement.
So do you throw the baby out with the bathwater and focus your marketing efforts elsewhere? No. The simple answer – and the reason I’m so excited – is to do email marketing better. More customer data and stricter measures on what you can do with it should be seen as an opportunity to take the next step. Put simply, you must personalize or perish. This is the challenge, and slick operators are starting to think more seriously about their database marketing and what’s possible in terms of driving customer loyalty.
It all starts with collaboration. For years operators have had systems such as guest Wi-Fi, booking platforms and loyalty programs in their business that capture customer data in isolation. The challenge has been to bring it all together, to make sense of it, and use it to ultimately grow the business, something that’s difficult and expensive. However, it doesn’t need to be and neither should it. I always say to customers it’s not the task of operators to design data flows and integrations – that job is down to suppliers.
Luckily there are many software providers in the hospitality sector who are only too keen to work collaboratively. It makes sense for all involved, especially when a partnership creates a system where the whole is greater than the sum of its parts.
Once you’ve got your systems playing nicely and all your data is being piped through to your CRM, it’s time to start personalizing your campaigns and here’s why it’s so important – it’s actually more economical to send one-to-one messages than one to all.
Surely it’s more expensive and time-consuming to set up hyper-personalized, one-to-one messages rather than sending a campaign to 5,000 contacts in one go? Yes, you need systems to manage these campaigns with the required integrations and they have a cost, but what we should be focusing on is the end goal, which is to generate another visit or stretch the customer’s spend during their visit.
These are the goalposts so which campaign is going to score more easily – a one-to-one message that resonates with the customer and puts them at the centre of your business or a one-to-all message with the same generic content as the other ten emails they might receive from your competitors?
When working back from the results, personalization is actually far more cost-effective. For one multi-site pub group we work with these campaigns have driven impressive rates of return footfall and resulted in hundreds of thousands of pounds of additional spend while more than doubling the number of downloads of its branded app, which allows the business to capture even more data.
Personalisation is about creating a one-to-one experience. There’s nothing greater than that warm feeling of being recognised as a loyal customer. Amazon, along with Netflix and Spotify, is a brilliant example of how to do it right on a huge corporate scale – recommendations rain down depending on your on-site activities. This can offer you a huge competitive advantage in an increasingly challenging market place – so what are you waiting for?
Words By David Bird – Impact Data UK Managing director