The restaurant industry has been rapidly evolving over the years, with advancements in technology and changing consumer behavior driving many of the changes. One major shift has been the move from traditional, in-person dining experiences to digital options that allow customers to order and pay online. As we move into 2023, restaurants are faced with the question of whether or not to embrace this trend and invest in digital solutions.
One approach that has gained popularity in recent years is the use of food subscription services, which allow customers to receive regular deliveries of meals, snacks, or other food items from their favorite restaurants. In this article, we'll explore the pros and cons of digitization in the restaurant industry and examine how food subscription services could be part of the solution for restaurants looking to thrive in the years to come.
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Food subscription services are relatively new to the industry. Amongst other trends followed by restaurants in the last year, this one has been extremely popular. Let us tell you why:
The prime advantage that comes with subscription services is definitely the added revenue. In addition to everyday sales from delivery, takeout, and in-house dining, restaurants can also have another dependable source of earnings.
When customers sign up for a subscription, you can expect an increase in customer lifetime value. So, the total amount of sales expected from one single customer rises quickly. This can gradually lead to higher profits and do wonders for your business in the long run.
By connecting loyalty programs and subscription programs, restaurants can analyze the customer data they’ve collected. This can be of great use to design personalized marketing strategies. Over time, these subscriptions help improve customer relationships and boost a restaurant’s online presence too. This goes hand in hand with more powerful marketing, promotion, and brand loyalty.
One huge advantage brought about by food subscription services is that they lead to easy customer acquisition. With changing lifestyles and hectic work schedules, customers now prefer to sign up for quick and easy subscription services that can make their lives easier. As customers subscribe month after month to your restaurant, they grow accustomed to it and you can expect them to keep coming back for more. Given that subscription services can be customized to meet different dietary preferences, they also serve as great gifting options that customers can get for their loved ones. This, in turn, brings more and more customers to your restaurant.
Here are two inspiring examples of how a business can profit from offering a food subscription service.
In February 2020, Panera Bread declared a game-changing deal. Customers could now subscribe for an unlimited amount of coffee and tea, no matter the size for only $8.99.
With a strong loyalty program already in place, the company was confident that they could pull off this deal successfully. Of course, things slowed down because of the coronavirus after the deal was announced, but business picked up in May again. People kept signing up nonstop, and the company received subscriptions of a whopping 700,00 customers over just three weeks. Evidently, the number of subscribers skyrocketed over a very short period.
Here’s what is interesting-as customers dropped by for their free beverages, it was only natural for them to look around for a quick bite along with their coffee or tea. With a huge variety of bagels and muffins offered by Panera, customers would often get tempted to order a snack too. What’s more is these accompanying snacks are usually high-margin items, which means that a simple subscription service for coffee and tea brought about a ripple effect, with customers now ordering a lot more than they normally would!
Pret a Manger, a renowned sandwich shop, also stepped foot in the world of food subscription. This UK-based chain launched a coffee subscription program in the country, which was the first of its kind. Customers can get a maximum of five beverages every day at a marginal monthly fee. The program offers a variety of drinks-coffee, tea, hot chocolate, and more. However, Pret does enforce the condition that there must be at least a difference of thirty minutes between orders.
This subscription service is tempting because it is super economical-for those who start their days with coffee or others constantly looking for a pick-me-up in the middle of the workday. The savings offered by this service are enough to entice customers to subscribe and so, the program has witnessed a huge rise in the number of subscribers.
Pret also links its POS systems with customer data received online as well as offline. By doing so, they can examine customer relationships better and strive for improved customer engagement.
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Millennials all over the world have subscriptions for their favorite magazines, online streaming platforms, and newsletters. Now, it’s beginning to look like food subscription is the latest addition to the club!
While a food subscription program is a great way to add to annual earnings, it offers so much more than that. Over the long term, it helps in enhancing customer engagement. Offering enticing deals and loyalty programs will ensure that your clientele signs up for these programs from time to time.
Chalking out a sustainable food subscription plan for your restaurant might take some time and experimentation. However, once you launch the food subscription program and market it effectively to existing and potential customers, your restaurant can get back to consumer demand levels that it faced before the pandemic struck the world. Soon, you could be rewarded with higher profits and make up for the difficult months of 2020.
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