New Study Finds Restaurant Revenue Down 45% In Post-Thanksgiving Holiday Season
While retailers see December sales increase as much as 77%, restaurants turn to new loyalty tools to retain VIPs during the holidays
SAN FRANCISCO, Dec. 15, 2014 /PRNewswire/ -- Thanx, Inc., which helps merchants effortlessly identify, engage, and retain their best customers – and works with hundreds of U.S. restaurants – released new data today showing that over the last several years restaurant revenue declined 22 to 45 percent during the post-Thanksgiving holiday period. The dining-out lull contrasts with the country's major retailers, who earn as much as 40 percent of their revenue in November and December.
Retailers opened on Thanksgiving to get a jump on holiday shopping, and with good reason. ABC News reported that the holidays account for 40 percent of a store's annual sales. 2009-2013 U.S. Census Bureau data show that monthly sales spike 24% in December for Furniture retailers, 47% for Merchandise, 67% for Electronics, 72% for Clothing, and 77% for Sporting Goods. The National Retail Federation forecast 2014 holiday sales of $616.9 billion, up 4.1 percent from 2013, which mirrored the ICSC estimate.
For restaurants, however, the holidays have the opposite effect. In a Thanx study across quick-serve, fast casual, and fine dining, the average restaurant experienced a 27% revenue decline in December, as compared to that year's monthly average. When expanded to the five weeks including Thanksgiving, the decline was even more severe, with revenue decreases ranging from 22 to 45 percent.
"With all the excitement about Black Friday and Cyber Monday, its easy to assume that everyone wins during the holidays – but these can be lean times for most restaurants," said Zach Goldstein CEO and founder of Thanx. "In our experience, restaurants that successfully combat the downturn focus on retaining existing customers."
To alleviate the holiday lull, Thanx offers an expanded suite of retention marketing tools. One multi-location merchant, Mixt Greens, used Thanx last year to identify VIP customers and reward any December visit with a wrapped gift of pre-packaged salad dressing. More than 50% of VIPs redeemed the reward and most visited Mixt Greens several times during the slow holiday weeks as a result.
"Through Thanx, we've made sure customers know how much we value their business and we can stay busy during what's traditionally a slow period," said David Silverglide, CEO of Mixt Greens. "By saying 'Thanx' to our customers, we've seen a 34% increase in frequency of customer visits."
This year, Mixt Greens has a different approach – again using Thanx. With "Eat Healthy This Holiday Season", Mixt Greens will deliver five 50%-off salads in 2015 to customers who make five purchases between Thanksgiving and December 31st. Just like the core Thanx program, qualifying purchases register automatically when consumers pay with their preferred payment card, thus requiring no added steps at checkout.
Thanx, founded in 2011, works with restaurants and retailers across the country. The company next plans to analyze transactions across industries to pinpoint how businesses can further improve customer retention.
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SOURCE Thanx, Inc.
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