We've been talking about it for a few years now, but what if the time had come for restaurant subscriptions? Far from being a mere fad, restaurant subscriptions are already producing dazzling results across the Atlantic. We explain why it could potentially be a cornerstone of the restaurant business model of the future, and what the most popular subscription benefits are.
Subscriptions are gradually gaining ground in all areas of our lives. Historically created by the press, subscriptions have recently spread to VOD, beauty and gourmet boxes, fruit baskets, etc. After Netflix and Spotify, why not subscribe to your favorite restaurant? This crazy bet has already been won in the USA: boosted by the pandemic, restaurant subscription initiatives have found a huge audience.
A precursor in America, the "Panera Bread" chain has hit the big time with its "unlimited coffee" subscription at $8.99 a month. The formula generated 500,000 subscribers in just a few weeks, with +200% footfall and +70% coffee purchases. Other subscribers include Olive Garden, BJ's Brewhouse and a host of independent restaurants with local customers.
The wave of restaurant subscriptions is in its infancy in France too. The first initiatives came from the English chain Prêt à manger. More recently, Bricktop Pizza and a number of other locally-based restaurants have jumped on the bandwagon, as part of a beta version offered by Pongo (that's us). And according to early feedback, subscriptions could well become a major trend in the restaurant business!
The subscription format is highly flexible. Restaurants can offer a wide range of benefits and prices. There's just one guiding principle: reward the most loyal of the loyal... and encourage the others to take the plunge!
Here is a non-exhaustive list of examples of customer benefits for restaurant subscription programs:
-All-you-can-eat coffee: ideal for boosting footfall and selling extras. It's also the cheapest subscription option, from €5 to €10 a month.
-Free food every day: on the basis of 1 bought = 1 offered. Bricktop Pizza in Paris, for example, offers 1 free margherita pizza with every visit.
-Coupon/Credit to spend on site : the subscription price entitles you to even more value each month, to be spent on site.
-Exclusive dishes: Olive Garden allows VIP subscribers only to combine any sauce and pasta format.
-Exclusive events: Invitations are sent exclusively to club members.
-Takeaway meals: Takoi, a Detroit-based restaurant, offers subscription-based meal kits to be enjoyed at home.
-Home-delivered items : from food to drinks. American restaurant chain BJ's Brewhouse offers kits for brewing craft beers, delivered every month.
The main advantage for restaurants is a repeatable, stable revenue stream. It's the holy grail in a sector that's inherently difficult to build loyalty around (although Pongo has some very effective solutions for this, here). With their recurring format, subscriptions provide leverage on sales, and can become a major part of them.
For example, an €8/month subscription that generates 500 subscribers guarantees a stable income of €4,000 per month, on top of current income. It was this quest for stability that prompted US restaurateurs to offer more subscriptions during the health crisis.
For a restaurant, the benefits go far beyond revenue. Subscribing to your restaurant is a way of showing real commitment. This commitment is also highly sought-after by restaurateurs. Big Mamma, Pokawa, Bricktop Pizza: all have understood the benefits of building strong food brands. The subscription concept is right in line with this approach, and allows you to build loyalty with total commitment from your best customers.
Rewarding your regulars with exclusive benefits is also an opportunity to test out innovations. This group of subscribers wants to get involved: they can give you their first feedback each time the menu, cuisine or drinks are renewed!
In return, subscriptions will require a great deal of effort on the part of restaurants. Firstly, because the practice is not yet established in France. To be successful, they need strong appeal products, with high-impact customer benefits.
To play the game and take advantage of subscriptions, restaurateurs will need to get involved at both communication and operational levels. Last but not least, a successful subscription program will probably need to be linked to other marketing initiatives. In particular, having a customer database in place beforehand is a major success factor. In the form of a CRM, like the one deployed by Pongo in restaurants, this enables you to identify your loyal customers and offer them the chance to join the subscription program to earn even more rewards.
Finally, a customer database allows you to analyze the consumption and average basket data of your regular customers. This key information is used to set both the subscription price and the rewards, so that they are engaging and profitable enough, for you and for them.
The restaurant subscription feature is currently being rolled out by Pongo to a small number of retailers. If you'd like to be kept up to date with new restaurant openings, please drop us a line via this page - we'll let you know as soon as there's news!
