Amid fierce competition in a customer-driven market, restaurant brands that focused on offering customers an improved customer experience were more likely to keep those guests coming back, according to recent research.
The fourth annual 2010 Leaky Bucket Study, which measures the likelihood of customers returning to a restaurant brand, found that more restaurant brands are retaining their customers than in 2008. Published by Restaurant Marketing Group, a division of ZenMango, the study analyzes a brand's "leak size" — the higher a brand's leak score, the more customers that brand is losing; lower leak scores indicate a higher level of customer retention.
"The decrease in overall leak size can be attributed to those brands that recognize that the only way to retain customers is to focus on the guest experience," said Arjun Sen, president of Restaurant Marketing Group. "In a time of fierce competition, these brands must make sure that every customer receives a compelling reason to come back."
With 2,483 respondents, the study evaluated 146 of the nation's leading restaurant brands in March 2010. Once respondents were identified as unlikely to return to a brand (less than 50 percent certain) they were evaluated on the primary return intent factors including quality of food, menu, atmosphere, price/value, location, service and family friendliness.
Divided among 19 brand categories, specific brands with the best leak scores included Bob Evans in the family-style category, Seattle's Best Coffee in the coffee category, and Corner Bakery in the bakery category. Additional highlights from the study's findings include:
Overall restaurant industry leak size improved in 2010. From 2008 to 2009, the industry saw its leak size increase from 29 percent to 36 percent. Yet the 2010 leak size is down to 32 percent, which indicates that most restaurant brands studied have recovered from significant customer base leaks in 2009.
Restaurant customers continue to be cautious about how often they eat out: 48 percent of restaurant customers say they are eating out less often.The restaurant industry continues to be a customer's marketplace, with 39 percent of restaurant customers feeling that more restaurants are competing for their business.
Primary drivers for choosing restaurants are (in order of importance): pricing specials/deals, quality of food and convenience of location.
Faced with an abundance of choices, customers are responding by changing their behavior — 35 percent of respondents said they are purchasing more prepared food from grocery stores, as opposed to restaurants, than they have in the past.