Limited-Time Offers Can Help Operators Attract and Retain Customers

By Mo Chaar
Canada’s restaurant industry continues to experience challenges, with nearly half of restaurants still operating at a loss or barely breaking even. With higher costs and weaker consumer spending, the food and beverage sector needs to get creative to keep patrons coming through the door, and limited-time offers (LTOs) are an attractive and innovative solution to drum up business in a tough time.

Limited-time offers like Starbucks’ olive oil coffee, Joe and the Juice’s tuna mousse matcha, and Wendy’s $1 fries for National Fry Day in July, are gaining popularity and solidifying their position as an industry staple to attract customers and test potential permanent menu items. According to recent data from Technomic, the number of LTOs in the food service industry has increased 53 per cent over the last four years. This growing trend highlights the importance of restaurants’ ability to quickly adapt and engage customers to retain a competitive advantage.

Here are some insights into why restaurants should implement limited-time offers.

The power of limited-time offers
LTOs create a sense of urgency and exclusivity. Customers are more likely to try something new if they know it won’t be around for long. In fact, Technomic found that 52 per cent of consumers consider the availability of appealing limited-time offers crucial when choosing a restaurant. This ability to draw in consumers is especially significant when 49 per cent of Canadians are dining out less often than in previous years.

LTOs also allow restaurants, especially quick-service and fast-food chains, to experiment with new flavours and trends without committing to a permanent menu change. By switching up menu offerings and balancing between customer favourites and trendy new items, restaurants can maintain their relevancy while still encouraging repeat guests.

This flexibility can help restaurants stay ahead of the curve and keep their offerings fresh and exciting. For example, swicy (sweet and spicy) beverages and meal deals are currently popular at chains like Starbucks to help businesses help recharge growth and increase revenue. Different demographics gravitate towards various LTOs, allowing restaurants to tailor their offers to a particular customer segment depending on their target consumer.

The number of LTOs has jumped 46 per cent at quick-serve and full-service restaurants over the past year alone, illustrating how these promotions are reinvigorating the restaurant industry by keeping customers interested and coming back.

Technology is the secret sauce
A robust POS system makes it easy to set up and configure LTOs. In addition, a restaurant’s mobile app should also be designed to promote LTOs to users and handle the higher order volumes that LTOs bring in.

While mobile apps and online ordering systems make it easier for customers to access these limited-time offers, AI-driven analytics can help restaurants identify which LTOs are performing well, so restaurants can adjust their menus accordingly.

With AI tools at their fingertips, restaurants have unparalleled insights into customer data, enabling them to turn previously anonymous visitors into valued guests. From push notifications to texts that send recommendations based on purchase history and similar customer profiles, AI can be used to help predict, recommend, and effectively engage with customers.

AI is set to profoundly impact and transform restaurants, and businesses that successfully implement LTOs with the right technology in place are more likely to encourage repeat customers. Additionally, using data analytics to track customer preferences and behaviour can help restaurants make informed decisions about future LTOs and potential permanent menu changes.

Leveraging loyalty
On their own, limited-time offers can help bring in new business, but to capture and retain those consumers, restaurant operators should consider implementing a loyalty program.

The first step is understanding customers’ needs and preferences. Next, businesses should analyze this data to identify trends and opportunities. Quick wins could involve providing a straightforward, appealing welcome reward to new loyalty members, using gamification elements to boost interaction, and deploying personalized communication tactics that help customers feel appreciated. The future of loyalty programs lies in hyper-personalization and seamless integration with daily life. By anticipating customer preferences and proactively offering rewards, businesses can stay one step ahead.

Implementing creative marketing strategies
The evolving landscape of the food and beverage industry demands agility and innovation. Limited-time offers provide a low-risk way to experiment with new menu items and a novel experience, enabling restaurants to test new concepts, engage customers, and boost sales. By leveraging technology and staying attuned to consumer trends, restaurants can create a dynamic and adaptable business model that meets the needs of modern diners. The future of dining is all about innovation, and those who can adapt quickly will lead the way.

Mo Chaar is the Chief Commercial Officer of Givex, where he oversees commercial strategy and development worldwide, including the development of GivexPay, as well as managing sales teams within North America.