Exploring customer retention strategies implemented by managers in the fast-food industry: A post-pandemic perspective

Abstract

The fast-food industry is one of the most competitive industries in South Africa and is challenged by various factors such as fierce competition, high inflation rates, decreased customer spending, constant load shedding, and the detrimental effects of the COVID-19 pandemic. Against the backdrop of increasing challenges, it is concerning to note that customer loyalty within the industry is declining, which poses a problem for retaining customers. Consequently, managers in the industry are tasked with finding new or alternative ways to retain their customers. This article focuses on exploring the strategies that managers implement to improve customer retention in the fast-food industry.

A qualitative exploratory research design was implemented, and semi-structured in-depth interviews were used to collect the empirical data from 13 managers in the South African fast-food industry. Participants were selected using a combination of non-probability convenience and judgement sampling techniques. Atlas.ti was used to code the data, and the Morse and Field approach uncovered the strategies implemented by managers in the fast-food industry through categorical and thematic analysis.

The results indicate that for customers to be retained in the fast-food industry, the business should provide a differentiated experience to customers. Based on the results, it can be advised that to retain customers, fast-food restaurants should employ a differentiation strategy so that customers perceive their product offerings as more valuable or unique compared to competitors’ offerings. Fast-food restaurants can do so by using high-quality ingredients, providing regular customer service training to employees, offering flawless service, and implementing a specialised menu as well as unique or personalised offers. Additionally, fast-food restaurants should also invest in the design of an attractive loyalty programme, alternative means of generating electricity (considering load shedding), and invest in their own delivery services. Implementing these strategies can help fast-food restaurants thrive in a highly competitive and challenging environment. In conclusion, the contribution of this research lies in the novel recommendations made to fast-food managers to employ a differentiation strategy to enhance customer retention in their industry after the COVID-19 pandemic.