Data Intelligence

Loyalty Deserves R-e-s-p-e-c-t

This morning, as I ordered my (very New Jersey) pork roll, egg and cheese sandwich, I gleefully noticed a stack of cards advertising that after purchasing 6 breakfast sandwiches, the 7th is free; one star-shaped hole punch later, my day was off to a great start!  I love a good loyalty program, and I’m more likely to patronize a business that offers one.

While comprehensive loyalty programs may take some time and money to launch, the benefits far outweigh the costs, especially since 57% of customers say they are more likely to dine at a restaurant that offers loyalty benefits, and research shows that loyal customers offer powerful word-of-mouth advertising, and spend more money than other guests. 

So now that you’re convinced you should offer a loyalty program, consider your options.  First, there’s a points-based system. Straightforward and easy for customers to understand, this system offers restaurants maximum flexibility for how many points customers can earn and for what kinds of rewards they can redeem those points, such as discounts or freebies.  A second type of system is a tiered system.  Starbucks harnesses a tiered loyalty program to incentivize more spending with increased rewards for more frequent visits.  Next there’s a gamification system, where you offer guests surprise rewards and prizes.  But while games can be fun for customers, they may not be as sustainable as other types of programs. The choices go on. 

No matter which format you choose, perhaps one of the greatest benefits of loyalty programs is the opportunity they offer restaurants to gather customer data; loyalty programs have practically become their own science.  Just having your customers’ email addresses is a win, but additionally, with a database of customer information, you can plan and execute targeted marketing strategies sure to draw a crowd. You can even get more specific by extending specialized offers to customer subsets, or personal offers, like birthday coupons. 

Feeling overwhelmed? There are plenty of tools to aid you in the loyalty process. But even if you just start out with punch card and work your way up to an app, or a digital program, customers will feel valued and motivated to give you repeat business. 

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