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How Restaurants Benefit from Social Media

The Old Way:

Before social media, restaurants depended on customers to fill out surveys to gauge customer satisfaction.

Surveys were inefficient because customers would:

  • lie on the surveys to be polite, because they knew that the cute waiter/waitress would read it afterwards
  • OR not fill them out at all.

The paper method of gauging customer satisfaction is flawed from the beginning.

Then Yelp came along, but:

  • only a small percentage of customers use Yelp.
  • the reviews on Yelp can have the tendency to be really good or really bad. Customers have to feel one way or another to pitch in their two cents.
  • there is no real incentive to use the website. No rewards, no social-networking integration.

The New Way:

Now there are location-based services such as Foursquare and Gowalla. Although Twitter remains a great tool for restaurants, these applications are even better because they:

  • help customers find different restaurants instead of just their usual hang outs. It’s great for new businesses!
  • provide an automatic loyalty system. It trims the paper even more by eliminating the need to stamp cards towards discounts or free drinks. (I always forget or misplace my loyalty cards.)
  • give customers an increased sense of exclusivity, just for visiting a restaurant multiple times.
  • create a competitive game between customers. Which customer will be the “most loyal” and will be treated the best this week?
  • provide restaurant owners a wealth of information about their customers with very little time, energy, and monetary investment.
  • provide the perfect amount of emotional distance from restaurants since they are:
    • part of  a customer’s personal, social network.
    • impersonal, just enough, to provide a completely honest opinion of a restaurant’s service (in a similar way to how we feel more comfortable yelling at other drivers on the road, but not in a face-to-face situation).

These LBS (location-based services) don’t mean that Twitter is useless. They just take the weight off of Twitter as the main online-marketing tool. Many restaurants use Twitter to communicate with their customers on a more personal level, and tweets have made an impact on the food-service industry.

One of the best, and most renown use of Twitter by a restaurant occurred last year:

P.F. Changs saw a tweet about how much a woman was enjoying their chicken lettuce wraps. P.F. Changs tracked down the woman to the branch she was dining at, paid for her meal,  and gave her free dessert.

The story has been circulated widely throughout the Internet and has been discussed on multiple websites and forums—all for under $20. (Chicken Lettuce Wraps: $6.50 + Average Dessert: $5.95 = $12.45 plus tax)*

Other businesses spend thousands to get the same type of attention.

Needless to say, P.F. Changs improved its service, gained some fantastic PR, and improved its value to its customers…all which add up to a bigger bottom line.

The Cynch: Paper is out, apps are in. Social-media services improve communication by breaking down formalities. Informal settings are key to listening in, providing great customer service, and improving business as a whole.

So next time you’re at a restaurant and the waiter slips a survey in with the check, just write “I Foursquared it.”

*For more case studies on how restaurants are using social media, check out Twitter09.

7 Comments

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7 Responses to “How Restaurants Benefit from Social Media”

  1. Calvin says:

    Really enjoyed reading this post. If only more companies, not just restaurants, used social media like P.F. Changs does. It’s really amazing how much social media can help a business.

  2. Cynthia says:

    @Calvin

    I agree that more companies should use social media to improve their image.

    These days, it’s hard to stay on the cutting edge if you aren’t on Facebook and Twitter!

    Thanks for commenting!

    -Cynthia

  3. Cynthia,

    Great post on restaurants and social media…as a recent restaurant owner for the fourth time, I’ve used social media pretty heavily to connect with my guests. Teaching people around me the skills, I find many look at social media as a pool that they are barely willing to dip a toe in, but once they get in, and really use it…it’s a super valuable tool that continues to pay out rewards. And oh yeah, IT’S FREE?!? Why more aren’t harnessing the power, I don’t know, but in my opinion, it is, and will continue to be THE way that people connect and at least START conversations.

    Great blog, I’ll be reading, see you round the “series of tubes”.

    btw….2009 was the year I fully understood that I’ve really been a geek for a long time, just a little undercover maybe…. :)

  4. Cynthia says:

    Hi Tony,

    A restaurant owner for the fourth time? A serial entrepreneur! I respect that. (I’m a huge fan of entrepreneurship/business-minded people.)

    It’s great to hear that you’ve been using social media, and I’m sure it has only improved your value and your business’ value to your guests.

    I agree that there’s a learning curve to the social Internet, but the potential payoff is huge.

    I think people are slowly beginning to realize that social media is no longer just an option for good businesses. Increasingly so, businesses are expected to be plugged in and responsive.

    The tradeoff for using free social-media services is spending Time + Effort.

    But if you consider Time=Money, then in a way, Social Media=Money….except not in a “$” sense.

    Btw, it seems that we have something in common – we’re both geeks as well as “something else” completely different (you=restaurant owner, me=eBay Power Seller).

    Thanks for reading and it’s nice to “meet” you. :)

    -Cynthia

  5. I just came across your blog and I really loved it because you combine style, beauty and wit. I have bookmarked your now.

  6. Jason Gegere says:

    Now you can get your own die-cut versions of foursquare check-in merchandise.

    I thought you would like to check out our global efforts to promote foursquare.

    Get your die-cut stickers, bar coasters, and window clings.

    http://www.HTMLgraphic.com/foursquare

  7. [...] ·         Give customers an increased sense of exclusivity – P.F. Changs example [...]

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