Ten Stamps Later and Your Customers Still Aren’t Loyal

What makes you come back for more? Really think about what makes you loyal for a second, because it’s something you never really question.

For brands relying on frequency like restaurants, the loyalty club has become standard practice. Buy 10, get the 11th free. Some can prove that those clubs drive increased frequency, maybe by .5 visits per month. That kind of increase is certainly valuable. But does it drive true loyalty?

The brands I know with successful loyalty programs are also successful in a bunch of other metrics as well. Funny how that works, isn’t it. Zoe’s Kitchen boasts a great performance from its loyalty club and app. But they do pretty well in store traffic and sales per unit across the board. Maybe it’s because they offer a unique menu mix not found at many other places at a reasonable price and executed well, operationally. They serve the food in a cool environment. Their employees are bright and friendly.

Which of those factors brings people back for that extra .5 of a visit? The free panini in five months or good meals and friendly people while you’re earning it?

Humanity Over Apps

I don’t belong to many loyalty clubs. I don’t like treating meals like a contract with Columbia House. I do use the Starbucks app because it provides more than just loyalty rewards. It offers a fast store finder, ordering tools, and nice payment functionality. The loyalty rewards themselves are on the silly side; access to apps and songs and refills.

A funny thing happened at my local store. I ordered a cup in a hurry, and they had just run out of my roast. The barista recommended a different drink I had never tried, and I accepted because of my helpless caffeine addiction. As she handed it to me, she said “On the house, thanks for trying this.” Super good experience.

Later that week, the Starbucks app crapped out on me and wouldn’t let me pay. I pulled out a credit card and haven’t used the app since. What I learned is that I wasn’t going for the gamification. Or the potential for a free 50th cup of coffee. I was going for the rare spark I get when there is an exchange of humanity.

As slick as I think the app is, (it is one of the best) it deleted part of the brand experience when the customer had to fidget with their phone to pay instead of interacting with the barista. Is that the kind of experience we want customers to be loyal to?

Experience Over Everything

Any store can offer your 11th thing free. It’s easy. Not every store can sell you something you want to have 11 times, in a way that makes you happy to do so. Experience is a huge driver for future visits. Most of that made up of elements that aren’t on the menu or with a UPC.

Are loyalty programs worthless? No. Can they alone drive traffic to a mediocre experience? No. If you are examining a loyalty program, make sure to put the same level of effort into the customer experience you expect customers to be loyal to.

5 Ways to Juice Up Your Restaurant Loyalty Program

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Has your restaurant loyalty program gone stale? Are you struggling to send the right message to the right customer at the right time? Here are 5 ways to make your loyalty program more valuable.

Has your restaurant loyalty program gone stale?

Are you sending random emails offering promotions without a purpose? Have you seen low open rates and low click-through rates? Are you struggling to send the right message to the right customer at the right time?

It may be time to experiment with data-driven restaurant loyalty programs. Data-driven loyalty programs consist of campaigns personalized by restaurant customer data gleaned from search results, mobile behavior, or even your restaurant POS system. They encourage repeat guests, but don’t alienate your existing customer base. When only 44% of loyalty program members are active (according to Colloquy), it’s important for your restaurant brand to stay top of mind for potential customers.

65% of guests say they are more likely to recommend a restaurant if it offers a valuable loyalty program, according to Loyalogy. Check out these 5 ways to make your restaurant loyalty program even more valuable.

1. Experiment with geo-targeting.

One way to juice up your restaurant loyalty program is through geo-targeting, or customizing the messages you send based on a potential guest’s location. Initially when mobile technology skyrocketed, restaurants started asking customers to “check in” on mobile in exchange for special offers. However, with the plethora of data about your restaurant customers now available, there are many more ways to target your restaurant customers based on location.

Geo-fencing is a specific strategy for geo-targeting customers. When a potential customer, someone who has opted into your loyalty program, is close to your restaurant and enters the virtual “fence” surrounding it, a message can be deployed, allowing brands to deliver timely bonuses. For example, a bakery can set a 1-mile perimeter around it and send ads or emails to customers who enter that radius. Simultaneously, it could set a 3-mile perimeter around a nearby office complex and reach potential customers that may be looking for somewhere to grab a pastry during lunch.

2. Comment on the weather, local sports.

If you don’t feel comfortable targeting your customers with mobile data, you could instead send emails based on hyperlocal happenings, whether that be new updates to the area, winning sports games, or odd weather.

For example, you could entice repeat customers by offering a themed appetizer if the local baseball team wins that night. You could suggest your most refreshing cocktail on the hottest day of the year, or highlight your cozy restaurant ambiance on days that it’s raining.

3. Track loyalty customers with their credit or debit cards.

Some restaurants require loyalty customers to sign in online in order to receive their rewards. Others are still using punch cards. Your loyalty program should seamlessly coordinate with your customer’s experience at your restaurant, automatically tracking how many points your customer has earned as well as what food items they’ve bought the most.

If your loyalty program is integrated with your POS system, it may be able to track their spending and remember customers based on which credit or debit card they use. That way, when paying for a meal, loyalty points instantly go into their account, and they don’t have to worry about inputting them manually or forgetting their password to sign in to the loyalty program.

4. Make it easy for your customer to check their loyalty points.

It’s also important to focus on the customer-facing side of your restaurant loyalty program. First of all, is there one? Can your consumers track points, rewards, and even past activity on an online loyalty application?

If not, this feature is definitely something to consider. With a customer-facing loyalty program, customers can track their rewards and follow their spending behavior online. Your restaurant can then send personalized emails to them when a new reward is available, and link them to the dashboard where they can view upcoming rewards, current ones, and more.

5. Personalize based on previous purchases.

With a restaurant CRM system integrated with your restaurant loyalty program, you can view your customers’ previous purchases or purchasing patterns and collect other valuable information. You could send a personalized reward to your highest spending guests or most regular customers to encourage their repeat business.

The ability to segment your restaurant customers is a must for loyalty campaigns. Have a new cocktail? Find all of the customers who have ordered a particular appetizer or cocktail, and offer that list of customers a promotion on the same dish the next time they come in.

Don’t Go Too Far

It’s important to remember that there’s a thin line between “cool” and “creepy” when targeting your loyalty messages. How do they know where I am? How do they remember what I ordered last?

64% of consumers say the best approach to mobile tracking is opt-in; only 12% are OK with being automatically tracked, according to OpinionLab.

That’s why you need to create a smooth restaurant loyalty program. Pull in additional data from social media and craft emails sure to resonate with customers. Create an omnichannel experience that’s relevant. And most importantly, think like a guest, not like a marketer, and set your sights on delivering a restaurant loyalty program that’s not only commendable but recommendable.

Allison Tetreault is the Content Strategist for Toast, the All-in-One POS System. She manages the Toast Restaurant Management blog and also creates valuable content for restaurateurs. Follow her on Twitter or LinkedIn.

Reaching Millennials to Improve Restaurant Traffic Growth and Loyalty

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Today, people have more choices than meal occasions. How do they choose?

Our recent national study on millennials and the dining decision provided some truly insightful takeaways:

  • Genuine customer loyalty and maximizing in-store opportunity are imperative to a brand’s short- and long-term success with this demographic.
  • Growing up with technology always within easy reach, millennials tend to view the world as “me-centric.” They’re accustomed to experiences built for specifically for them. Tweaking your customer interaction and marketing to cater to this mindset can pay big dividends.
  • Given the ever-increasing purchase power of Gen Y, a strong millennial customer base presents not just a challenge, but an exciting opportunity to reverse the no-growth trend. The key is to examine your tactics now, and change them if necessary to get ahead of the curve. Gain their trust and hold on tight.

Do you have your customers’ loyalty? We’re not talking about formalized loyalty programs here, but the genuine support and allegiance of your patrons. In the age of the millennial, loyalty is critical to growth in a no-growth category.

If you’re not sure you have their loyalty yet, consider a few ways you can earn it:

Experience and insights.

This may go without saying, but it’s imperative to provide the optimal experience for customers on every visit and to use every interaction to gain insights – insights you can use to surpass their expectations next time. Make each visit personal and meaningful, and while you’re at it, observe and listen. Watch how they interact with the physical restaurant and the staff, and when they have suggestions or criticisms, take them to heart.

Download the presentation of our national Millennial dinging study: Dining’s L-Shaped Change.

Flexibility

Ask yourself, is the restaurant flexible? Is the staff accommodating? Do you allow customizations to menu items? Will you split the check for large groups? Identify and remove all stopping points for the customer, to make the experience frictionless.

Marketing and operations fluidity

Use each visit to encourage more visits. In-store promotions and creative loyalty programs should be fresh, engaging and create value. Also, consider carefully how your operations and marketing teams are working together. Are they both on the same page? Are front-line personnel aware of promotions so they can inform the customer? Do your marketing plans offer creative ways for employees to deliver meaningful, shareable, frictionless visits? If it’s been a while since you evaluated your marketing tactics, there’s no better time than now.

The early bird gets the millennial

Our research showed that nearly 70% of millennials make the decision to dine at home or dine out in less than six hours. With such a limited timeframe, you must be opportunistic and work to create craving during the decision window. Mind the gap, and make it count.

Showcase your food

Create effective, drool-worthy imagery and entertaining messaging to draw in customers. Is your food indulgent? Embrace it! Show it off with an Instagram post or a tweet. Millennials are in touch with their guilty dining (and social media) pleasures. Don’t just “show the food” – show it off. Nowadays, two taps on Instagram tends to be the currency of the industry.

If your audience doesn’t come to you, go to them

Hit your customer during their decision-making process by utilizing media dayparting and geo-based targeting. Be there when it counts. Take full advantage of the efficiency and flexibility of the same digital tools millennials are already using.

It’s important not to look at Gen Y as an elusive unicorn. Get their attention (and dollars) by capitalizing on loyalty and opportunity. By taking these steps, you can develop high relative awareness for your restaurant. If you build (on) it, they will come.