Why Your Restaurant Should Offer Student DiscountsSoften the blow to a student's budget and they could become loyal patrons for years to come.
Interested in bringing in more of the high-school and college crowd to your restaurant? One surefire way to attract more business from students is by offering them a special price.
According to a recent report from student affinity network UNiDAYS, titled “Gen Z: What Restaurants Need to Know,” 93 percent of students say they are more likely to try a restaurant that offers a student discount.
“When it comes to where and how they eat, Gen Z students prefer going to restaurants over dining halls or cooking. Almost 48 percent of survey respondents don’t have campus meal plans, and 18 percent of them eat out even though they have meal plans,” explained Marisa Allan, UNiDAYS’ vice president of innovation.
Here are a few reasons giving students VIP pricing can help your restaurant create loyal customers for years to come — before they even start adulthood.
Get a head start on tomorrow’s market
Currently comprising 26 percent of the U.S. population, Gen Z is anticipated to grow to 40 percent by 2020 — which means this group will have a significant influence over the future of your restaurant. What’s more, UNiDAYS estimates Gen Zers already hold about $44 billion in spending power and wield considerable influence on the $829 billion that their families spend on them.
Although the oldest among them are just finishing college and launching their careers, student-aged consumers are a demographic to not be ignored. Winning their hearts and creating loyal customers today can have a long-term impact on your restaurant in years to come.
Reach a captive audience
College students love dining out. They are not “broke” and “penniless,” as conventional wisdom dictates, but have money to spend and time to experiment with new restaurants, said Allan.
Aside from tuition and bills, students spend the majority of their disposable income (78 percent) on food, and nearly half (48 percent) say they try a new restaurant at least once a month.
While they may eat out a lot, Gen Z isn’t bad with managing money. In fact, Allan said this group tends “to be more financially savvy and responsible than previous generations. They are willing to spend but expect value.”
Engage with these adventurous young eaters by giving them a financial incentive to visit your restaurant and focus your messaging on the value of the meal their getting for such a great price.
Capitalize on off-peak hours
Offering special deals for students specific to off-peak hours can be a win-win, bringing more business to slow shifts. Students are more willing to be flexible when it comes to meal times, especially when it means saving money. Almost all respondents to the UNiDAYS survey (91 percent) said they’d be willing to visit a restaurant at an off-peak time in order to get a discount.
“This reveals a big opportunity for restaurants to help boost slower dayparts and offset higher labor costs during off-peak hours with campaigns designed to draw foot traffic from students at those times,” said Allan.
Show loyalty to your community
Jay Bandy, president of restaurant consultancy Goliath Consulting Group, advised viewing student discounts as part of your restaurant’s larger strategy to engage with the local community.
“It’s a way to show you’re a part of the university community. This is critical in university towns and when you are near a university in a larger city,” he said. “The further out the restaurant is to the school, it is important to determine if the discount pulls in students or you are discounting without driving additional traffic. In this case, we recommend sponsoring activities on campus and advertising on digital or print newspapers that go to the students.”
Allan echoed this sentiment, and suggested restaurants “look for local chapters of student-run organizations that have an ample following. Perhaps explore philanthropic efforts to donate a portion of your proceeds to help the local community.”
Related: How Restaurants Can Market to Gen Z
Instead of setting a flat percentage discount for students, Bandy recommended creating special deals, such as a $5 student lunch combo, adding on a free beverage or doing half-price appetizers with an entree purchase.
“The restaurant wins by offering items where they can be profitable and the student gets a value for their money,” he said. You can even extend the deal to faculty and staff, which “can help with getting more business from the university when the students are on break.”
Is it right for you?
Bandy warned that student discounts aren’t a good fit for every restaurant. If there’s enough demand for your food from the student segment, a discount may not do much to drive additional traffic.
Student discounts are great for word-of-mouth marketing and can help you create a connection with this young generation early in life — one that will hopefully continue for decades to come.