Lifetime Value of a Customer

Too often when a customer walks into the restaurant for the first time there is no emphasis placed on the lifetime value of that customer to the business. The consideration is skewed heavily toward this one transaction. Where management may occasionally remember the lifetime value equation, the staff tends to be especially weak in this area. The concern for extracting the largest tip or increasing the check amount during this one transaction takes precedence with the staff. When was the last time a server ended a transaction by saying "come again soon and ask for me"?

Seth's post offer some kindle to this discussion;

Instead of comparing what you invest to the benefit you receive from the first bill, the first visit, the first transaction, it's important to not only recognize but embrace the true lifetime value of one more customer.

Write it down. Post it on the wall. What would happen if you spent 100% of that amount on each of your next ten new customers? That's more money than you have to spend right now, I know that, but what would happen? Imagine how fast you would grow, how quickly the word would spread.

Imagine if your staff embraced customers as lifetime partners in the business. Actively tried to build a book of business by their service and in doing so grew the restaurant. Imagine that every customer is not a single transaction, but a continual stream of transactions. How do you treat that customer? Why are you not doing that to every customer that walks in the door? This is a cultural discussion, your establishment either treats all their customers as a relationship or it does not.

It is pretty obvious which establishments value the lifetime customer!