Restaurant leaders from IHOP, Potbelly, The European Pizza Firm and vPromos spoke about what makes their loyalty packages tick on the Restaurant Franchising and Innovation Summit.
Loyalty packages are a dime a dozen nowadays, with eating places seemingly tripping over themselves to supply prospects rewards. However for each Starbucks, with its passionate fanbase and astronomically profitable rewards program, there are numerous others that fail to seize buyer curiosity.
A panel dialogue on the Restaurant Franchising and Innovation Summit held in March in Kansas Metropolis aimed to crack the code, dissecting what makes a loyalty program actually partaking and what pitfalls to keep away from. Restaurant trade specialists delved into the secrets and techniques behind constructing a program that fosters buyer loyalty, not simply one other forgotten app notification.
The summit, run by Networld Media Group, attracts executives from main manufacturers to share profitable methods to construct and handle eating places. Networld Media Group is the mother or father firm of Fastcasual, Pizza Market and QSRweb. Its subsequent foodservice occasion is the Quick Informal Government Summit being held October 13-15 in Denver, Colorado.
The professional recommendation was shared in a breakout session referred to as “Why Your Loyalty Program Is not Working,” a panel moderated by Stacey Kane, a fractional chief advertising officer who works with a number of manufacturers. Audio system for the occasion included Nathan Casey, VP of digital advertising, engagement and experiences at IHOP; David Daniels, SVP and CMO at Potbelly; Tommi Tervanen, CEO of The European Pizza Firm and Peter Vogel, chief income officer for vPromos.
Working loyalty packages
Casey stated IHOP has seen good success with the launch of its loyalty program. “The visitor response was simply improbable,” he stated. “We had super progress sort of proper off the bat, and we’re seeing that enhance and spend. We’re seeing that enhance in transactions that you’d anticipate from a loyalty program.”
Kane stated IHOP is a legacy model and requested why the model launched its first program simply two years in the past. Casey stated his trade has been altering considerably over latest years and apart from Starbucks and Domino’s, the restaurant trade was reluctant to embrace loyalty for a very long time. Simply earlier than the COVID-19 pandemic, QSRs started launching loyalty packages in droves.
Casey stated the explanation he believes extra eating places have embraced loyalty packages just lately is advertising associated. With the decline of linear tv and an aggregated viewers, manufacturers want extra methods to succeed in prospects. Second, manufacturers began to see the advantages of data-driven advertising and understanding buying conduct.
“It is a option to get your visitors to self-identify themselves any time that they are making a purchase order so to begin that relationship along with your visitors so you have got that direct advertising channel to them and, second, you perceive their conduct over time,” he stated.
Tervanen stated The European Pizza Firm believed eating places should not launch loyalty packages except they perceive what the shoppers’ views of loyalty packages are. A examine by Merkle discovered that 56% of shoppers first take into account the product they’re receiving, whereas solely 20% think about a restaurant’s loyalty program when ordering.
The European Pizza Firm, primarily based in Finland, bought 10% of the inhabitants — 20% of the households — to hitch its loyalty program in simply two years.
“The superb reality is that our loyalty members are on on-line orders near 70% now,” Tervanen stated. “And of the overall firm income, it is 38%. Buyer lifetime worth is about 180 euros ($192.42). … That is attention-grabbing when you may calculate the maths (of the) buyer lifetime worth divided by the client acquisition value. After which you may direct your advertising marketing campaign enhance.”
The model’s frequency doubled from three to 6 instances a yr.
Personalization
Daniels stated personalization is necessary to Potbelly’s loyalty program. The model has salad, sandwich and soup shoppers, so there is not a “one-size-fits-all” loyalty resolution for his prospects.
“If I am a salad buyer, I do not need a sandwich. I see no worth in sandwich gives,” Daniels stated. “So as to have the ability to generate the most effective worth proposition, I feel personalization is vital. … If all you are getting are sandwich gives and you are a salad shopper, it is as if we do not know who you might be and we do not know something about you.”
With personalised gives primarily based on menu knowledge and buyer conduct, “we see exponentially increased charges of engagement,” Daniels added, “each supply redemption and customer frequency.”
Vogel’s model, vLoyalty, stated the premise of what his firm gives relies on automation, which helps each the service provider and the client. When paying, if a buyer hasn’t been to the restaurant earlier than and a bank card shouldn’t be acknowledged on the terminal, visitors are given the choice to hitch the loyalty program proper on the spot and begin incomes rewards that day.
“From that time ahead, each time the individual pays, they’re tracked robotically, the factors are recorded, and we even go so far as to automate the rewards,” Vogel stated.
Signing up
Kane stated she struggles along with her manufacturers getting prospects to obtain yet one more app. She requested the panelists what they do to encourage signups of the panelists’ loyalty packages.
Daniels stated Potbelly has Potbelly Perks promotions that the model advertises which are solely accessible for loyalty prospects. “By promoting them throughout our whole nationwide media marketing campaign, you are figuring out No.1, it is a horny supply, so there is a hook there (and) there is a worth proposition within the supply, and it is engaging sufficient to say ‘hey, if the one approach that I can entry that’s both obtain the app or be part of the loyalty program, I am prepared to try this.'”
Potbelly gives a free unique sandwich to get folks to join the loyalty program, however the model additionally has an underground menu that may solely be accessed by the app.
Casey stated IHOP’s groups should be excited in regards to the loyalty packages to make it work. “They need to be purchased in. They need to see the worth in it, and so they need to see the worth in providing it to the visitor. Most of our staff like giving added worth to the visitors, making them completely satisfied making it a optimistic expertise, so working with (staff) to make them enthusiastic about it (and) about providing this system is a large factor.”
IHOP additionally permits prospects to pay their payments from their telephones by way of the app. Casey agreed that having a sign-up bonus is crucial.