Illustration of rewards and loyalty system for restaurants

Loyalty & Rewards Program

Reward loyalty on each and every visit

  • We asked customers how likely they are to dine at restaurants that offer loyalty programs over those that don’t.
  • Sixty-eight percent of customers say they are “somewhat” or “very likely” to dine at restaurants that offer loyalty programs over those that don’t. Of the customers that said that about 36% are in the 26-35 age group.
  • What this tells us: Loyalty program customers are more likely to return to your restaurant.
  • Given the choice between a restaurant with a loyalty program in which they’re already enrolled versus one in which they’re not, customers are more likely to dine at the restaurant where they’ll accrue additional rewards.
  • This is especially so when a restaurant loyalty program rewards them consistently for every visit, whether it’s through accumulating points towards a discount or the ability to redeem a voucher by reaching a certain number of visits.
  • You don’t want to be giving free rewards out every other visit, but you also don’t want them to feel like they never earn anything.

Make your restaurant loyalty program simple

  • When asked about the restaurant loyalty programs they belong to or have considered joining, we asked customers how important is it that it offered the following perks.
  • The ability to accumulate points towards rewards is a clear favorite among customers as a total of 73% of customers consider points to be “very important” and “extremely important.”
  • What this tells us: Consumers are familiar with the concept of earning reward points for their purchases.
  • That familiarity makes the adoption of your program simple and provides a better user experience, making it more likely that customers will engage with your restaurant loyalty program.
  • There’s also the psychological aspect of working towards a goal. For example, by visiting your restaurant, they are now 40% of their way closer to earning that free starter or dessert. That means every visit creates more revenue for your restaurant.
  • Gift certificates also appear to get customers excited to enroll in restaurant loyalty programs, as 52% of our respondents said they are “very important” and “extremely important” for earning a certain level of spend, points, or visits.
  • What this tells us: Implementing gift cards as part of a restaurant loyalty program provides customers with the flexibility to claim rewards whenever they wish.
  • Here are a couple of reasons why this is such a popular loyalty program reward:
  • Customers have the option to choose a specific menu item they want rather than receiving a reward already pre-selected by your restaurant.
  • Customers get to choose to use a portion of the gift card and save the rest for later visits. 
  • Research shows that consumers with gift cards often spend well above and beyond the amount in the gift certificates, by as much as 25% or higher, tapping into the psychology of “I’ve already spent the money.”

Go beyond monetary rewards to provide personalized and memorable experiences

  • After points and gift certificates, over half of respondents consider personalized rewards to be “very important” and “extremely important” to them.
  • What this tells us: Customers love discounts and savings—but just as much, they value personalized rewards and experiences, such as the preferential treatment of receiving a free meal on their birthday.
  • Based on the free menu items it hands out for customers’ birthdays, we found that the average spend from those transactions emerged as one of the highest among its rewards.
  • “Not only are people coming to redeem them, but they’re also purchasing more products from us during their visit,” 
  • Loyalty members are more likely to engage with your restaurant loyalty program if you provide personally relevant rewards or offers. 

Establish a digital and mobile strategy for your restaurant loyalty program

  • Over 70% of customers find the ability to redeem their rewards on digital and mobile platforms “important,” “very important,” and “extremely important.”
  • What this tells us: Customers like–and expect–to interact with restaurants digitally.
  • This demonstrates a huge opportunity to build customer loyalty and increase customer retention through a digital or mobile strategy.
  • Having a digital and mobile presence enables restaurants to gather information and preferences to provide the best-personalized experience for customers.

Educate staff on the restaurant loyalty program

  • Encourage your employees to ask customers if they’re a part of your restaurant loyalty program and train them to be confident in talking about the benefits.
  • If customers have already signed up, highlight the benefits of the program to encourage more use. If they haven’t signed up, provide an incentive for them to sign up on the spot (e.g., 10% off your purchase if sign-up is completed). It doesn’t require much effort from customers, and all that’s needed is a “yes.”

Here are the key areas employees need to be educated about on your restaurant loyalty program:

  • What type of rewards structure the loyalty program is based on
  • How rewards and promotions are sent out (e.g., email, text, and app notification)
  • Functionality and flow of the app or rewards platform, from the customer perspective
  • How to answer and overcome objections to signing up
  • Frequently asked questions about the program
  • Final Takeaway benefits to the guest
  • Positive customer experiences are the foundation of every successful restaurant and well-executed loyalty program.
  • Before implementing a loyalty program, it is imperative that you have a fully equipped and functional restaurant POS system that sets your restaurant up for growth.
  • Not only is the right restaurant POS essential for managing and analyzing customer data (e.g, customer purchases and habits), it enables your restaurant to deliver greater customer experiences by saving time and streamlining daily operations.
Marius Joubert
Author: Marius Joubert

Founder of the first true community for the restaurant and hospitality industry.

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