Challenges Faced by Food and Beverage Manufacturers and Grocery Companies in Customer Retention?

Every sector faces some challenges or the other when it comes to retaining customers. The food and beverage industry, as well as the grocery and CPG sector, faces the following challenges:

1. Low customer retention rates

The restaurant industry has one of the lowest customer retention rates. A 2018 study found that the restaurant sector has a customer retention rate of 55 percent, while it’s 84 percent in the media and professional services industry.

2. Limited prospects to differentiate customer experience

This applies to grocery companies where the opportunities for different customer experiences are extremely limited. In price-sensitive markets, products with affordable price tags sell more.

3. Infrequent purchases

A study conducted by loyalty and guest engagement platform Thanx Inc. found that 70 percent of restaurant customers never make a return visit to the same restaurant after their first visit. Many customers are more likely to churn after just one bad experience.

4. Rising competition and disruption

Over the last few years, the competition in the food and beverage industry (as well as the grocery industry) not only substantially increased but a lot of disruption happened as well. The evolving digital technologies and the entry of new players have altered the competitive landscape in the industry.

5. Difficult to have a unified customer profile

Another big challenge for the food and beverage industry and grocery store chain is that it’s difficult to have a unified customer profile as many customers alternate between online and offline purchases and there is no means to connect them.

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