Most restaurant operators believe 70 percent of customer traffic comes through word of mouth, and a majority of them use social media as the vehicle. But according to survey results published this week by Punchh and RunningRestaurants.com, word-of-mouth marketing on social media only works if restaurants gauge the effectiveness.
Punchh, a social loyalty platform created for the restaurant industry, and RunningRestaurants.com, an online resource for restaurant owners and managers, polled 130 restaurant decision makers in 2012 about the social media channels they use and whether they can measure the actual value of those efforts to their restaurants.
"Operators who can measure the impact of word of mouth to their restaurant marketing plan can build on that knowledge and drive even better ROI," said Jaime Oikle, owner of RunningRestaurants.com. "Our survey showed restaurant operators know this, but that they aren't sure how to accomplish it."
According to the survey, 77 percent of operators believe social media helps them acquire new customers. Another 76 percent believe it drives brand awareness, and an additional 71 percent say it increases customer loyalty via rewarding regulars for patronage.
But while nearly 91 percent use Facebook and Twitter for marketing, they conceded they don't fully understand how to interpret feedback data (Facebook likes, Twitter follows and retweets) as relevant to their social media marketing.
Jitendra Gupta, CEO of Punchh, said knowing how social media-generated WOM benefits a restaurant is essential to understanding how to maximize it. Customers already use social media — WOM delivered digitally — to express their opinions about restaurants. But as a growing number of them use mobile phones to share their restaurant opinions, it's crucial operators learn to reach them there.
"The recipe for driving word of mouth is finding the right combination of social media interaction through mobile phones, and customer loyalty generated by and rewarded through those phones," said Gupta, adding that 55 percent of Americans use smartphones. "Loyal customers are restaurants' largest untapped resource for spreading word of mouth. What Punchh does is use mobile phones to access them through social media channels and get them talking about restaurants and food they like."
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