Customer Retention in the Restaurant Industry: The Complete Guide

If you are in the restaurant industry, customer retention should be a major focus for your business. It is important to get new customers in the door. It may be even more important to keep past customers coming back again and again.

This guide on customer retention for restaurants was created to help you build a solid understanding of what retention is and why your restaurant needs to focus on it.

What is customer retention for restaurants?

Customer retention for restaurants is the ability of that restaurant to convince customers to eat there again and again. In this aspect, the restaurant is able to increase sales without necessarily having to increase the number of new customers.

Why should restaurants focus on customer retention?

A Harvard Business School study has shown that “Increasing customer retention rates by 5% can increase a companies profits by 25-95%”

This data point has been the foundation for many businesses focusing on their retention efforts.

If you focus on increasing the lifetime value of each customer, you can self-fund advertising to acquire new customers. It truly becomes a beautiful flywheel effect.

Restaurant Customer Retention Ideas

Text Message Marketing

Having worked with thousands of restaurants from mom and pop cafes to large franchises such as Tropical Smoothie, we have been able to witness the power behind text message marketing.

With 90% of texts opened within 3-5 minutes, you can send out a message to your customers when they are at their hungriest and know they will receive the message! Sign up for our 14 day FREE trial and we will personally consult with you on how exactly to implement texting into your restaurant! There is no credit card required or any contracts so you can cancel at any time!


Your restaurant has some ingredients that are getting close to expiring. Foods that use those ingredients need to be pushed. You can send a text blast out to your subscribers about a special for 40% off of those items for one day only. This allows you to use those ingredients. Discounting can be better than having to throw them away completely. With immediate and full reach, you will know your customers got your message and will take action quickly.

Email Marketing

Email marketing is another way to keep in touch with your restaurant customers. Email is the most actively used form of communication, so there is some merit in using it for your restaurant. With 20-30% open rates, it is less effective at reaching your customers vs texting, but still deserves respect as a marketing medium.


You can send out an email to your email subscribers on Monday for the events happening at your restaurant that Friday. If you have live music, you can send out information regarding that band and what the customers can do to make reservations so they don’t miss out on a great time. With lower open rates and open times, it is best to send emails a few days before any events or specials so that you can have the maximum number of people see your message.

Mobile Applications

Mobile applications can be another way to retain customers at your restaurant. You can track reward points and give incentives for customers to spend more. One downside to mobile apps is that they will need constant developer maintenance. This can turn into a huge expense. Another downside is that around 90% of your app download users will churn (stop using /delete it) within 30 days of downloading. This is not ideal for longer term retention.


You have a customer loyalty program through your app where each customer has a QR code as their ID. For every dollar spent at the location, they receive credits towards future meals. You can also notify them through the app of any upcoming specials and events that will push through to their phone notifications. Starbucks does a great job with their mobile app and loyalty program to keep customers coming back.

How To Improve Restaurant Customer Retention.

The first step to improving customer retention for your restaurant is to serve good food and have great service!

This should go without saying, but no matter how optimized your retention strategy is, it will never overcompensate for bad food or service.

Next, you will want to collect customer information. This is key because without having a way to keep in touch with your customers, you won’t stand a chance at improving your retention rates. Building that customer list is an important step.

After that, you will want to consistently stay in touch with your customers. This doesn’t mean sending out promotions or discounts daily. Change it up. Send out any upcoming events you may be having or anything you may be sponsoring. There are many things you can send out to your followers, so keep putting different messages in front of them.

Lastly is to stay consistent. Don’t give up on our retention efforts. Some weeks may be slower than others, but you will want to stick with this strategy for the long term. Rome wasn’t built in a day. Your retention program won’t be built in a day either.

Final thoughts: Customer Retention in the Restaurant Industry

Customer retention is an especially useful strategy in the restaurant industry. People have to eat. Why shouldn’t they eat at your place more often? Building a solid retention program will enable your restaurant to keep customers coming back again and again.

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