Originally published on FranchiseConnectMag.com | Click here to see the article
Without critical customer data, businesses are left stumbling around in the dark. Data provides necessary insight. For brick-and-mortar franchises, obtaining customer data is a critical component to grow a thriving business. It enables your franchise to segment its customers by demographics, preferences and extremely powerful customer behaviors and patterns. However, far too often businesses lean on third parties like Google or Facebook for their data acquisition and even worse, are limited to only using those platforms for critical customer engagement. This is problematic for many reasons and proves to be incredibly limiting.
Third party data is often inaccurate and unreliable. Pitney Bowes commissioned a study conducted by Forrester Consulting that noted hesitancy by businesses to utilize third party data who cited accuracy as a concern. For example, one study found that a particular data vendor had identified 84% of their users as both male and female. The other concern is tracking. With browsers allowing users to block cookies, online audiences have become harder to track. A survey by Flashtalking found that 64% of advertisers’ tracking cookies were being rejected or blocked by their browsers.
Data doesn’t have to be left to third parties, however. Businesses can acquire and own their data which has these benefits over leaving it to the likes of Google,Facebook, Point of Sale (PoS) Systems such as Square, and even credit card companies, like Capital One:
- Improved segmentation and targeting
Segmenting and targeting customers is important since it enables a franchise to personalize messaging—and personalization is especially effective at driving repeat engagement and loyalty over time. Third party platforms like Facebook do allow you target users to some extent, however, the targeting is limited. For example, with a restaurant franchise, Facebook is not going to tell you how many of your followers were on premises during lunch on a Tuesday. And it also won’t tell you which users typically only come for happy hour or haven’t visited your establishment in the last 30 days. Instead, utilizing technology in your favor—like capturing contact information through free access to your venue’s WiFi hotspot—provides the opportunity to not only know your customer’s behaviors, like how often and what days and times the customer visits, but also provides a means of communication via SMS and email; messages could also be sent instantly or on a schedule. A quick example – repeatedly being sent the “Weekday Lunch” newsletter is frustrating to someone that only comes to see live bands on the weekend. Which leads to the second benefit.
- Enhance communication and build better relationships
When you own your customer data, you can build stronger customer relationships. It proved especially useful during COVID when restaurants and hotels needed to pivot and distribute updates, offers and incentives to sustain revenue direct outreach. Here’s an example:
A small breakfast franchise utilized customer data acquired when customers accessed free WiFi. That provided them instant access to over 5,000 loyal customers and, through simple text greetings enabled them to acquire over 3,000 loyal social media followers – all with a single, simple click by the customer. During COVID, the franchise was required to close their dining rooms,, they then pivoted to take-away breakfast orders. But in that confusing and tumultuous time that failed to gain traction — until they launched an integrated campaign that used text messaging and a social media campaign. The one to one text message provided a preview of the social media campaign that incorporated pictures of their take-away set up and the message with “we’re serving breakfast”. It was a tremendous success with business tripling the very first weekend. Owning their data and having the platform to being able to talk directly to their customers via text messaging was the key and amplified their social media efforts.
But even in less uncertain times, the ability to communicate with customers hinges on solid data that can be segmented and targeted. Our article “Social Gravity: Hacking the Social Media Algorithm to Further Guest Engagement” further explains why this effort dramatically expands exposure on social media.
- Understand and drive customer behavior
While communication with customers is critical, it’s the stepping stone to driving behavior. Imagine being able to fill empty restaurant seats on your slowest night, or motivating customers at a sports bar who only buy beers to purchase food, or transforming a one-time customer into a repeat customer.
Modifying behaviors requires one thing, you must know the current behaviors. To accomplish these behavioral changes, the right message must be sent at the right time to the right person. Or in a nutshell, it must be personalized beyond “plugging” in the customer’s name and relevant to the customer, like knowing that they are regulars on Saturday night.
Here’s how owning your data accomplishes this utilizing the sports bar franchise as an example. When a customer has provided his or her information and is following the establishment on social media, it creates an opportunity. Through the data analytics, you can pinpoint the customers that only come to Happy Hour on Fridays and always leave by 7 p.m. The next Friday, when they walk into your sports bar, based completely on knowing their behaviors, they receive a highly customized SMS message with an offer for a BOGO entree after 8pm, that introduces them, and a friend,to your food. Next Friday when this customer comes in they will be more likely to consider staying for dinner —thus increasing sales by knowing the customers behavior and then encouraging the customer to modify their behavior.
- Engage with customers 24/7
Owning your customer data also means you can not only connect with your customers outside of your brick-and-mortar establishment, but can connect with them anytime, anywhere with extreme reliability in contrast to a social media post that you hope might be shown to 2% of your followers. This is a huge departure from one-off interaction and enables franchises to deliver the social media post directly to the customers phone at the exact time they desire. Why is making social media efforts successful important? 68% of consumers agree that social media enables them to interact with brands and companies, according to a Sprout Social poll. But the social media platforms don’t provide the company the ability to control the exposure to their followers. By owning your own Customer Data, you can integrate your data, with your tools and leverage the social media platforms to directly and reliably target your customers and dramatically increase your ROI from your social media investment. Plus, by engaging with your posts, it breeds loyalty.
- Owned data can be tracked and analyzed across franchise locations
With owned data, you can build customer profiles, track all your locations visited and send out standardized and consistent brand oriented messaging throughout your franchise network—regardless of which location the customer was originally connected to. It provides the opportunity to track customers across stores and send highly tailored messages based on each unique location, groups of locations or the entire franchise. Further, integrating the entire franchise network allows for powerful franchise wide engagement campaigns such as rewards for visiting multiple locations. You can even segment your data to send alerts about new openings or regional specials and more for a specific customer’s area.
When it comes to operating a thriving franchise business through the use of integrated technologies the value of owning your data instead of leaving it to a third party has become crucial. Hyper-segmentation, real time communications, understanding behaviors, and building high-value relationships with your customers ultimately can mean the difference between success and failure, especially for brick-and-mortar franchises in a digital age where customers expect personalization and a personal touch.
Originally published in Franchise Connect Magazine
by Stephen Gould, CogoBuzz CEO/Founder