After the first successes, the subscription is exhausted in almost all sites.

Success in the restaurant world, as in any industry, requires in-depth knowledge in a wide range of spheres and specialties. I have always envisioned the complexities of the restaurant business model as a three-dimensional Venn diagram encompassing the economics of food, real estate and hospitality, with overlapping affinities for cooking, culture and the consumer. A giant assortment of moving parts.

Having worked in the hospitality business for over 25 years, I am wary of the proverbial “quick fix”. Incremental changes that can yield big results do exist, and they almost always come from a client’s insight or attitude. It is this idea that fuels the positive results we have enjoyed with our recently launched “Royalty Program”, which is our enhanced version of the traditional loyalty program.

To set the table here:

Like many restaurants in the summer of 2021, the Rib & Chop house has experienced a post-COVID restaurant boom. To say people were just ready to go out would be an understatement. It was a need: to be served, to sit with other customers, even to be brought to a table was a big problem.

It’s one thing to look at all the data points that tell this story, but it’s quite another to see customers walk into our restaurants with a mixture of joy, and even relief, on their faces. The data wouldn’t tell you how crucial the atmosphere of a real restaurant — you know, with real forks and real steak knives — was for people.

It was around this time that we started to hear, anecdotally from our employees, how guests came to see the host or hostess and tried to give them money in order to get a table. or end up on the waiting list. And it wasn’t just an isolated event here and there. He became semi-regular.

Our guests showed a clear need and it was not necessary to have an MBA to recognize the opportunity presented to us. The question was how do we respond to it in a way that stays true to our brand promise of Rocky Mountain Hospitality. Rib & Chop House prides itself on its inclusiveness, being a place where everyone is welcome. Rolling out a program that would give preferential treatment to customers was a risk. At best, we were making educated guesses about the best path forward.

It’s also important to note that we already had a rewards program, Rib and Chop House’s Member Rewards, which allows customers to earn 5% on all purchases and $10 for every $200 spent. It made no sense to modify or expand the operation of this program to serve these customers. What we guessed at the time, and confirmed once the program launched, was that the guest seeking to skip the lines would match an already existing segmentation within our customer profile: l high-end user.

READ MORE: How Rib & Chop House’s Premium Membership Program Improves the Dining Experience

It required something entirely new, and long story short, after some brainstorming with the marketing team, we came across the idea of ​​a loyalty program that would far outweigh its cost. Recognizing that an elevated steakhouse experience should be reported, we called it the Royalty Card. But we also found that the term “loyalty program” was diluted. If everyone in the world can access it, there is nothing; it’s simply a marketing tool where you accumulate points to redeem for a discount or free item.

We really wanted to keep ours special and stand out in an ocean of loyalty. This is why we need to cap the number sold. Not all marketing/loyalty vehicles are meant to have unlimited growth. When you have something wonderful, take it for what it is, don’t try to stretch it so much that it waters down. If he lost the exclusivity, he would lose the soul. Capping the number of memberships also maintained the restaurant’s inclusive spirit.

We have carefully considered the benefits. For $50 per month, members would receive:

  • $600 in gift cards per year, the cost of the card itself
  • Priority placement
  • A free set of branded steak knives
  • 10% off every check including alcohol
  • Cancel at any time

We tested at two locations and had early success – the only major issue being how the restaurant-level team communicated priority seating to non-Royalty customers.

The results?

We are “sold out” of royalty memberships at almost every location. Note that Royalty member reservations do not affect non-member wait times, as each store reserves tables specifically for these users. To determine how many tables are needed each evening, we use a predictive model based on the number of seats, whether it’s a weekend or a weekday, what can happen in city ​​and the number of subscriptions sold. For example, if a store has 150 subscriptions and its Friday night, it might have five or six tables. The system assumes that some Royalty members are still making reservations.

Customer learning confirmed the intuitions we had made at the start:

  • A typical check for a royalty member is 14% higher than that for a non-royalty member. They have a 10% discount, so the total check is higher, even with the discount!
  • The typical Royalty member is not a discount seeker; they are experienced researchers. They’re not looking to save 10%, but to use that 10% to upgrade their glass of wine or order a dessert.
  • Tips are also higher for waiters!
  • Average customers may visit 1-3 times per month. Members of royalty visit five times a month. Granted, because we’re in smaller towns, we’re often the best game in town. If we were in a major DMA, it would be more difficult to obtain these numbers of visits
  • Less than 1% canceled their membership. He is universally loved. So how do you expand the royalty program if it’s exhausted? Each time we build a new restaurant (we plan to build 3 in the next 18 months), it generates additional revenue
  • Perhaps most interestingly, the most loyal members of royalty have reservations. What the royalty card captures is an additional visit. EG, it’s 5 p.m. on a Thursday, the family hasn’t planned dinner. They decide to go to Rib & Chop House because they know the experience will be good and there will be no waiting. This is the key. It’s not about boiling the ocean with a loyalty program, it’s about turning your top customers into brand evangelists.

Like many aspects of a restaurant, the royalty card is a work in progress. We’re looking at more members-only events, like wine tastings, and even using them as a discussion group, giving those guests a taste of a new menu item. A special R&C recipe book as a gift is also in the works.

Of course, there are no formulas for success in the restaurant world. The Royalty Card program as we have developed it may suit a particular Midwestern sensibilities. What is undeniable though, is that insight is a key fundamental. If you’re looking for ways to build your brand, listening to your guests is a good place to start.