Written by Richard Sutherland Published on July 18, 2025 On this page Key Takeaways What Restaurant CRM Actually Does Track Customer Preferences, Visits and Feedback Personalize Offers and Promotions Segment Guests for Email and SMS Campaigns Identify VIP Customers and Build Loyalty Programs Improve Reservation and Follow-Up Experiences Prioritize Key CRM Features for Restaurants How CRM Drives Repeat Business and Bigger Orders Challenges and Best Practices Verdict FAQs Expand According to a study by Olo, approximately 60% of revenue in the restaurant industry comes from repeat guests. If you’re not successfully enticing your customers to return, all the effort you put into creating a great first impression will be for nothing. Despite this, eight out of 10 restaurateurs say they find it hard to personalize at scale.To compete, you need customer relationship management (CRM) software that captures guest information, understands habits and helps you deliver a personalized service that builds genuine loyalty. This guide walks you through exactly how your restaurant can make the most of CRM to deliver better guest experiences and increase repeat business. CRM for Restaurants: Key Takeaways A restaurant CRM creates a complete 360° profile for every guest by integrating data from your POS, reservation system and online ordering platforms.Tracking guest data, such as visit history, spending habits and favorite dishes, allows you to deliver a highly personalized service and offers that foster loyalty.Customer groups enable you to run targeted marketing campaigns via email and SMS that vastly outperform generic messages.Connecting your CRM with other technologies, such as your POS systems and reservation platforms, is key for automating data collection and gaining a comprehensive view of your customers. What Restaurant CRM Actually DoesThink of the best CRM for restaurants as your business’s long-term memory, automatically collecting and organizing information about your guests from every touchpoint: your reservation list, POS systems and your online ordering platform. Rather than scattered data across different systems, you get a unified 360° profile for every customer.A powerful restaurant CRM builds rich profiles that can include:Visit and spend history: How often customers dine with you, their typical spending and what they usually order.Personal details: Birthdays, anniversaries and contact information.Preferences and notes: Allergies, dietary needs, preferred tables, or tags like “wine lover” or “vegetarian”.Feedback history: Records of survey responses or online reviews.When you centralize this guest data, you can immediately understand who your customers are and make data-driven decisions about how to serve them better every time they interact with your brand. Track Customer Preferences, Visits and FeedbackThe most important thing a CRM system does is automatically capture detailed information about your guests without creating any extra work for your staff.For instance, when a guest makes a reservation through a platform like OpenTable, their past visit frequency and any notes are displayed for the host. And, when they pay their check, your POS system automatically sends their order details to their profile.Even if they order takeout through your website, that data is captured. You get a constantly updated record of all customer interactions without lifting a finger.Good restaurant CRMs, such as Toast and SevenRooms, can automatically tag a guest based on their order history. They might list a patron as a “steak lover”, “vegan” or “craft beer fan”, for example. You can also add custom tags, such as “VIP” or “positive reviewer”.This allows you to understand a guest’s preferences at a glance and use that information to segment your audience for more personalized service and marketing.Furthermore, connecting with feedback tools allows you to link a review directly to a guest’s profile, providing the necessary context to respond effectively. Personalize Offers and PromotionsWith people bombarded by so many ads these days, it’s hard to cut through the noise. A CRM lets you stop shouting into the void and start having personal conversations with your guests. Using the rich data in each guest profile, you can create and automate offers that feel custom-made for them.Some ideas include:Celebrate special occasions: Automatically send a guest a “Happy Birthday” email with an offer for a free dessert or champagne during their birthday month.Acknowledge preferences: If a guest’s profile shows they’re tagged “vegan”, send them a targeted message announcing your new plant-based tasting menu. For instance: “Hi Veronica, we know you love our vegan options and wanted you to be the first to know about our new menu.”Surprise and delight in-service: Make it easy for your staff to create memorable moments. For example, a note in the CRM will indicate an anniversary celebration, prompting the server to offer a complimentary glass of champagne. These small, personal touches build powerful customer relationships. Segment Guests for Email and SMS CampaignsOne of the most profitable activities a CRM enables is smart guest segmentation for your marketing campaigns. Instead of blasting the same email to your entire list, you can divide your audience into smaller, more targeted groups based on their behavior and preferences.With just a few clicks, you can create segments for:High-spenders or VIPs: Invite them to an exclusive wine-tasting event.Frequent lunch visitors: Send them a mid-week special to encourage another visit.Lapsed customers: Target guests who haven’t visited in 90 days with a “We Miss You” offer. One coffee chain realized a 10.9 times return on investment with this approach.Preference-based groups: Announce a new gluten-free menu only to guests who’ve ordered gluten-free items before.This targeted marketing dramatically increases your marketing effectiveness and, with automated CRMs, these campaigns can be set up to run automatically in the background, consistently working on your behalf. Identify VIP Customers and Build Loyalty ProgramsIn most restaurants, a small percentage of your guests make up a large portion of your revenue. A CRM’s analytics tools are perfect for finding your highest spenders and most frequent visitors. Once you identify your best customers, you can treat them like the valued individuals they are.Focusing on these high-value guests is one of the most effective strategies for customer retention. It can also be the foundation of a successful loyalty program. You can create a tiered system that offers meaningful perks to those who deserve them most.Tip: Utilize your CRM data to create a VIP tier with exclusive benefits, such as priority booking for special events, access to off-menu items or even a private line for reservations.Through automated rewards and recognition, you can ensure your best guests feel valued. A simple, automated text message after a visit saying “Thanks for being one of our VIP guests, [Name]!”, reinforces their status and strengthens their connection to your restaurant. Improve Reservation and Follow-Up ExperiencesThe customer experience begins long before a guest sits down at a table and continues long after they’ve paid the check. A CRM helps you manage this entire journey while automating much of the messaging.For instance, CRM-driven messaging lets you:Send automatic confirmations and reminders: Reduce no-shows by sending email or SMS reminders 24 hours before a reservation.Share private booking links: Offer your VIPs or large parties a dedicated link to make booking easier.Automate follow-ups: Send a “Thanks for dining with us!” email automatically the day after a visit. This is the perfect chance to politely request a review or ask for private feedback through a short survey. This way, if a guest has a negative experience, you can find out about it directly and address it privately before they post a damaging online review. Prioritize Key CRM Features for RestaurantsThere are many restaurant CRMs, so it’s easy to get lost in feature lists. Instead, focus on the CRM software functions that directly impact guest experience and revenue. These include:POS integration: The ability to sync automatically with your restaurant’s POS system enriches guest profiles with detailed spend and order-level customer data. Look for deep connections with the POS systems that big chains use.Online ordering data capture: A significant portion of your business may come from takeout and delivery services. Your CRM must be able to capture customer information and order history from your online ordering platform to provide a complete picture of guest behavior.Automation tools: Look for a system that can automate workflows. This includes sending triggered emails and text messages (such as birthday offers), applying auto-tags to guest profiles and managing loyalty program rewards with minimal manual effort.Reporting and analytics: A good CRM should have a user-friendly dashboard that provides clear insights. You need to be able to view reports on your key segments easily and track the performance of your marketing campaigns.Third-party connections: Beyond your POS, the CRM should connect to other tools you use, such as your reservation platform and email marketing services. How CRM Drives Repeat Business and Bigger OrdersUltimately, any investment in a CRM is about driving measurable financial results. When restaurants turn anonymous guests into known customers and use their data to personalize the experience, they see real increases in repeat visits, loyalty and sales. It’s a proven strategy in the modern restaurant industry.Consider the case of Sabor Latin Street Grill. After implementing a CRM-powered loyalty and email marketing system, it found that 24% of total sales came from members of its loyalty program. In a single quarter, its targeted email campaigns generated over $40,000 in traceable sales.Similarly, after relaunching its rewards program with an AI-powered CRM, the popular chain Smashburger gained $1.9m in incremental sales. The system helped managers understand customer behavior and deliver the right incentives to encourage more frequent visits and larger orders. Challenges and Best PracticesDespite its advantages, setting up a CRM system can present some potential hurdles. Follow these best practices to ensure you reap the benefits these systems have to offer.Avoid over-communicating: Just because you can email your guests every day doesn’t mean you should. Set clear rules and limits for your automated campaigns to prevent message fatigue. Focus on sending relevant, valuable content.Keep your data clean: A CRM is only as effective as the data it contains. Regularly merge duplicate profiles, correct errors and ensure information syncs accurately across all your connected systems.Train your staff well: Your team is on the frontline of data collection and use. Train them not just on how to use the CRM, but why it’s important. When they understand that noting a guest’s favorite wine can lead to a better experience and a better tip, they’ll be more likely to use the system consistently.Respect guest privacy: Be transparent about how you collect and use data and ensure your practices comply with relevant privacy rules, such as the General Data Protection Regulation (GDPR) in the European Union and the California Consumer Privacy Act in California. Building trust is a key part of customer relationship management. Verdict A customer relationship management (CRM) system is useful for any restaurant that is serious about growth. It provides the tools to build strong, lasting customer relationships that make for repeat business. When you connect with your POS and other systems, you can capture the data needed to understand your guests on a deeper level.This data powers everything from personalized service touches to automated marketing campaigns that encourage customers to return more frequently. When you identify your VIPs, enhance the reservation experience, and address challenges such as staff training and data quality, your CRM will yield more repeat business, increased loyalty and a stronger bottom line.To find the right platform for your needs, check out our guide to the best CRM for restaurants. To gain a deeper understanding of the investment, explore our guide to CRM pricing and costs for 2025. FAQs Can a small, independent restaurant benefit from a CRM? Absolutely. A CRM enables a small restaurant to offer the kind of personal service that fosters a loyal local following. It automates marketing and data collection, freeing up valuable time for you to focus on food and service quality. How long does it take to see a return on a CRM investment? While it varies, the average time for a business to achieve a positive ROI on a CRM is 12 months, according to B2B software site G2. But restaurants can see an immediate impact from using a CRM to grow their marketing list or reduce no-shows with automated reminders. Written by: Richard Sutherland Richard has more than 20 years of experience in business operations, computer science and full-stack development roles. A graduate in Computer Science and former IT support manager at Samsung, Richard has taught coding courses and developed software for both private businesses and state organisations. A prolific author in B2B and B2C tech, Richard’s work has been published on sites such as TechRadar Pro, ITProPortal and Tom’s Guide.