Pizza as a monthly service?

Discussion in 'Marketing / Increasing Sales' started by Donatello, Jul 21, 2018.

  1. Donatello

    Donatello New Member

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    So I was looking at a list of my customers and almost 30% of them order the same Pizza at pretty much the same time every month. This gave me an idea . . .

    Why not send them the Pizza they usually order with a little side of something as gift every month? Basically, create a monthly service where I charge you monthly (No need to worry about change plus I save paper through online invoicing, etc).

    With all these food apps exploding, I think we can do something here.

    Online monthly pizza delivery for one decent monthly charge.

    Recurring revenue didn't hurt anyone before . . .

    Hmmm . . . What do y'all think? Anyone doing something similar?
     
    Last edited: Jul 22, 2018
  2. Mondo

    Mondo Active Member

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    I think this is something all of us have thought about. The problem with pizza is the customer has to be ready to receive the order when it is delivered. It’s easy for us to schedule an order in our POS system, but you’re asking a customer to remember a pizza delivery a week or more in advance. That’s just not reasonable with most peoples lives.

    I think a better alternative is to get a mobile app that will save the customers card info and past orders so they can reorder from their phone in just a few clicks.
     
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  3. Steve.L

    Steve.L Member

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    Your idea might sound good in theory in order to build a monthly recurring revenue. But...
    a. You'll have to invest in gateway(s) and other services to provide recurring options to your customers
    b. Much higher rates for services like that unless you're planning to charge them manually
    c. You'll definitely need a written and signed payment authorization or a service where customers can subscribe for themselves
    d. Much more prone to chargebacks/disputes with not good chances of winning a case. Plus regardless of winning or not, you'll still be charged the chargeback fee from the processing company (Between $20 to $35 per instance)
    e. Funds subject to reserve (10% reserve to your funds which will be released on the next round of charges. Most likely to happen with subscription services, depending the gateway and the processor)
    f. People in general don't like the auto-pay/subscription options. They don't even use the auto-pay for services they use regularly, such as phone bills, electric, etc. And that's because they all want to have control or to think they have), over the payments. The only way that changes is if the service they want to use, is not provided in any other payment option besides the subscription. Therefore, even though they order the same thing at the same time every month, it's still their own choice. Converting their optional order into a subscription means you're enforcing the sale no matter what, until they cancel the subscription.

    Stil, you can give them the option to subscribe to your monthly service and see where that takes you...

    A different approach could be like that:
    You could create different plans, subscription based and offer an incentive to attract subscribers.
    For example:
    "15% off with monthly subscription" Charge a monthly fee to provide a discount on all orders. Use it or lose it policy.
    "$100 credit value for $85. Subscription per month" same policy.

    You'd have to consider all added expenses of running a subscription service and the risks associated with it to see if it's worth doing it of course.
    But something similar to that would be my suggestion if you were to offer subscriptions.
     
  4. Mondo

    Mondo Active Member

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    Steve, you just gave me a great idea to play around with in our loyalty program....create a monthly spend threshold and if the customer meets it, they get a percentage off all orders the following month. Thanks!
     
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  5. Steve.L

    Steve.L Member

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    I actually like that idea better than mine :)
     
  6. Donatello

    Donatello New Member

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    @Steve and @Mondo - Some wonderful ideas guys. It seems like receiving payment seems to be an obstacle here but not really. Especially if you go the online route. I have a guy who's currently doing something similar online (Not with Pizza unfortunately) but I think I might have to pay him a little visit. He's the computer genius in our little circle. Will keep y'all posted. A 'hybrid' of ideas is the answer. *Thinking cap on* . . .
     
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  7. durbancic

    durbancic Active Member

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    We've been trying to come up with something along these lines, just never came up with something we thought would be worth it to our customers / easy to manage. Going to keep an eye on this thread though.