The power of small numbers

The power of small numbers
Tags: Business Strategy and Profitability, Customer Service / Experience, Food & Beverage, Franchising & Growth, Industry Services, Marketing, Professional Services, Trends / Statistics
August 3, 2010 - Janet Eden-Harris

“As long as repeat business is important, and as long as customers have a chance to go somewhere else, employees must deliver high levels of satisfaction for a company to be successful.” Claus Fornell makes that point abundantly clear every time he and his team at the University of Michigan report out the results of the American Customer Satisfaction Index. The recent results are no exception.

In the Family Casual category, we saw some nice improvement over last year’s numbers. But it’s a crowded field out there, and the truth is, most restaurants group within a +/- 3 point spread in satisfaction. Couple that with the fact that the highest scoring restaurant this year, Olive Garden, scored just an 84 out of 100. There are stand-outs, to be sure. But we all know that we’re just one service slip-up away from falling back into the mediocre bucket.

But there’s a second, more fundamental reason that we have to work so hard to get and retain customers.

Take a look at the findings from Market Force’s most recent survey of consumers on their recent experience with a new restaurant. We asked consumers if they’d tried a new QSR, Family Casual or Coffee shop in the last 30 days. Almost 1 in 3 had tried a new Fast Casual QSR. Two-thirds were delighted, which is outstanding. But that means one out of three consumers that tried a new restaurant rated the experience as ‘just ok’ or worse, downright ‘bad.’ Restaurants spend so much money, energy and resources to get consumers through the door. Would you be happy knowing that up to one-third of them aren’t likely to come back?

Often, the reasons for dissatisfaction are simple to fix. A friendly greeting. A menu suggestion. Faster service. Softer music. But the payback can add to millions of dollars. We helped one of our clients calculate that they could add $18 million to their bottom line by simply training and reinforcing wait staff to offer up-sell menu items, and capturing a fraction of the new business garnered as a result. The power of small numbers.