Restaurant loyalty programs can help businesses increase customer retention and revenue. These structured systems reward customers for their loyalty and repeat business by offering incentives, discounts, and exclusive benefits. Restaurant owners can boost their lifetime value and promote sustainable growth by keeping consumers coming back for more.
According to a survey, loyal consumers spend 67 percent more than new customers. Restaurants generate 80% of their revenue from 20% of their customers who are loyal to the restaurant business. This 20% of customers keep visiting the place often and place the largest orders.
In this blog post, we will look at the steps to building a successful restaurant loyalty program as well as a few innovative loyalty program examples.
A restaurant loyalty program is an organized structure that rewards consumers for their repeat business and loyalty. It is a deliberate approach to engage and retain customers by offering a variety of incentives, discounts, or exclusive benefits. The primary goal is to keep customers coming back, increase their lifetime value, and, eventually, drive revenue for your restaurant.
Ideas for a Restaurant Loyalty Program
Now that we've covered the basics, let's look at some new restaurant loyalty program ideas for 2023:
1. Item-Based Rewards
Customers can receive free or discounted menu items based on their purchases via item-based rewards. A “Buy 5 Coffees, Get the 6th Free" deal, for example, is a simple yet efficient way to encourage visitors to return. Consider showcasing your most popular or profitable items in such programs to increase sales and customer satisfaction.
Another innovative idea is to provide “Meal of the Month" promotions, in which loyal customers can relish an exclusive, rotating cuisine at a reduced price each month. This keeps the menu fresh and increases excitement among your regulars.
2. Incentives for Promotion
Promotional perks extend beyond food and beverages. Consider providing unique access to restaurant events, goods, or even cooking classes to your most loyal customers. By creating unique experiences, you not only retain customers but also create unforgettable moments that they will remember and share with others.
Furthermore, implementing time-sensitive promotions, such as “Happy Hour Specials" only for loyalty program members, can enhance foot traffic during slower periods and help maintain a consistent stream of profits.
3. Subscription Rewards
Subscription-based loyalty schemes have recently gained popularity. Customers can subscribe to a monthly dining plan, similar to a meal kit subscription. In exchange, customers receive a specific number of meals at a discounted rate or with other benefits. This methodology offers a consistent income stream and repeat business throughout the month.
To sweeten the transaction, consider offering customizable membership plans that allow customers to choose their preferred dishes and dietary constraints.
4. Online Incentives
Online incentives have become essential as the digital world's influence has grown. Implementing an online ordering system with exclusive discounts for loyal customers can dramatically improve your online presence. To engage and retain your online audience, consider offering free online cooking classes, recipe eBooks, or behind-the-scenes content.
Creating a user-friendly mobile app can improve the online experience by making it easier for consumers to place orders and redeem rewards.
5. Point-Based Rewards
Points-based reward programs are a classic option. Customers earn points with each purchase, which can then be used for discounts or free items. Make sure your program is simple to understand with a clear points-to-rewards conversion ratio.
Consider adding bonus points for special occasions such as birthdays and anniversaries, giving consumers another reason to choose your restaurant for their celebrations.
6. Free Delivery
Offering free delivery solely to loyalty program members can be a game changer in this day and age. This portrays your business as customer-centric and encourages repeat orders, making it easier for your customers to enjoy your delicious offerings in the comfort of their homes.
Ensure excellent delivery logistics and effectively communicate the benefits of free delivery to customers.
7. Experiential Rewards
Provide unique dining experiences as rewards, such as chef's table dinners, themed nights, or wine tastings. This exclusive events reward loyalty, generate buzz around your restaurant and attract new customers looking for a great night out.
Collaborate with local vendors or artists to increase the distinctiveness of these experiences.
8. Reward Networks
Join reward networks to expand your loyalty program outside your restaurant. Collaborate with local businesses, such as hotels, theaters, or spas, to offer cross-promotional rewards. This not only broadens the appeal of your loyalty program but also motivates people to visit your region.
Create an integrated marketing strategy to effectively promote these networked rewards.
The Top 5 Finest Loyalty Programs in the Restaurant Industry
Now that you've had a taste of the QSR sector, it's time to look at some of the best examples. The top 5 best restaurant loyalty programs are shown below. As you'll see, the top 5 examples are from the most popular fast-food brands, which isn't surprising given their international reach and success.
1. Hut Rewards from Pizza Hut
Pizza Hut, the famous hut-shaped pizza restaurant chain and small pizzerias started by two brothers in 1958 in Kansas, quickly became one of the most successful franchises in the United States. Since 2014, they have enjoyed a consistent revenue of around USD 12 billion per year.
Hut Rewards, a fast track to free pies, was introduced in 2017. This restaurant loyalty program was created to boost Pizza Hut customers’ visit frequency and loyalty.
With the new Hut Rewards program, customers can earn unlimited points and a free pizza in as little as one order," said Pizza Hut Chief Brand and Concept Officer Jeff Fox.
The Pizza Hut program was created to keep things simple while yet keeping customers engaged. New customers can join by going to PizzaHut.com, clicking on the Hut Rewards loyalty program, creating an account, and enrolling in the program. Existing customers can simply check in to their account and choose to opt into the Hut Rewards program.
Customers who enroll can start earning points and reaping program benefits immediately. Every dollar spent on food online earns you a free pizza. Exclusive offers, birthday rewards, and other perks are also available. Hut Rewards points can only be earned and used during mobile and online ordering for delivery or carryout.
Take a look at our latest blog on Top Pizza Captions For Social Media Posts – Instagram
2. MyMcDonald's Rewards
McDonald's is the undisputed king of fast-food restaurants. It is the most profitable restaurant chain, with nearly $6 billion in revenue in 2021. They served 69 million customers each day in 2018. There's even a running joke that wherever people go, a McDonald's restaurant follows.
It should come as no surprise that the most popular fast-food chain also has a successful digital restaurant loyalty program!
MyMcDonald's Rewards will have 20 million users by 2021. The most popular award was for the iconic McChicken sandwich. 360 tons of fries and 17 million desserts were awarded to users. The figures are startling. Let's dive further into what's driving the loyalty program's success.
The more points you have, the higher your tier and, thus, your ability to redeem more valuable prizes.
The program is divided into four stages based on points: 1500, 3000, 4500, and 6000 points for various rewards from the 16 menu items.
Customers can also earn points in other ways. For example, if you add your credit or debit card to the McDonald's mobile app, you will receive 1500 bonus points automatically. This implies that if you use the app to pay, you will receive a free McChicken sandwich or a classic Cheeseburger.
The rewards program is simple and easy to use, which is probably one of the most important aspects of all the finest restaurant loyalty programs.
3. Subway MyWay™ Rewards
Subway, a restaurant providing famous sandwiches founded in 1965, now employs over 400,000 people worldwide and has an annual revenue of more than 16.1 billion USD. Subway sandwiches are controversial due of their taste. Whether you like them or not, they are another example of a good QSR loyalty scheme.
Subway MyWayTM Rewards was introduced in 2018 to replace the old SubCard loyalty program, and it is intended to offer a personalized discount system to Subway customers. MyWayTM is one of the world's largest restaurant loyalty programs, with 28,000 restaurants participating.
The design of the Subway restaurant loyalty program is what makes it a successful customer loyalty program. Subway created the loyalty program after surveying its customers to find out what they needed from a loyalty program.
Customers receive four tokens for every dollar spent, and 200 tokens get them a $2.00 reward coupon. Guests are given opportunities to earn more tokens on the go and are even given surprise rewards such as sandwiches, cookies, and drinks.
Customers also receive a special gift on their birthday. Furthermore, guests do not need to remember to carry their physical cards because everything is tracked via the Subway smartphone app.
4. Starbucks Rewards
Starbucks was founded in 1971 and, for a brief period, was the most popular location to photograph in an Instagram photo. Their famous logo, which featured a mermaid on a green backdrop, became a symbol of modern lifestyles and remote work (at least before COVID-19 popularized working from home).
Starbucks now has over 30,000 locations in 80 countries, with the majority of them in the United States. The company generated $29 billion in revenue in 2021.
It was an obvious option for the coffee chain to develop its own restaurant loyalty program to protect frequent customers from transferring to other popular brands and local cafés. Starbucks has 24.2 million members in the United States, making it one of the most successful consumer loyalty programs ever created. Starbucks contributes 40% of total sales to the Rewards Program, and retail sales have increased by 7%.
Starbucks Rewards is available not just through your smartphone but also through a prepaid card that can be used to pay for items from the Starbucks menu. Customers who use the Starbucks® Rewards Visa® Card earn reward points more quickly than those who use regular bank cards.
That's because you can use this card anywhere—in the grocery store, while shopping for new clothes, or while on holiday. Every dollar spent with the Starbucks® Rewards Visa® Card earns you one Star, and you can redeem a gift with as little as 25 Stars.
Starbucks has two loyalty tiers: green and golden. Green Status is reserved for individuals with 1 to 199 stars or points, while Golden Status is reserved for those with 200 or more stars.
The program provides the following features and benefits to green and golden status holders:
-> Free food, beverages, and extras
-> Order ahead and pay with the smartphone app.
-> Free refills on brewed coffee and tea
-> Every year, a free birthday gift
-> Bonus reward days
You can earn “stars" that can be redeemed for free products in a variety of ways:
- Earn two stars for every dollar spent at a Starbucks location using a registered Starbucks gift card or the Starbucks mobile app.
- Earn stars for purchases of Starbucks brand products such as packaged coffee, cups, prepared beverages, and sandwiches.
- Buy Starbucks coffee online and link it to your Starbucks rewards account.
- Earn bonus stars by taking part in games and special offers in the app and via email.
5. The Wendy's Rewards™
Wendy's is a popular fast-food joint among hamburger lovers. A multinational brand based in Dublin, Ohio, but originating from Columbus, Ohio.
Dave Thomas, the founder of Wendy's, was also noted for appearing in more advertising than any other company founder in history. Thomas' net worth at the time of his death was 4.2 billion USD.
Wendy's created Wendy's RewardsTM over 20 years after the death of its patriarch. It works on the same principles as the previously stated programs, with the consumer receiving 10 points for every dollar spent on a company's food. As a result, the points can be redeemed for a variety of items on Wendy's menu, ranging from free desserts to cheeseburgers and salads. If a diner spends $10 (which isn't difficult), they can get a tiny frosty with their meal.
To get the points, either pay via Wendy's app or scan the QR code at the counter. If you forget your phone and are unable to scan the QR code, you can still collect your points by scanning the receipt.
The points can then be used at Wendy's for free meals and other offers. To keep things interesting, the reward list is always changing. Wedny's often offers customers various deals and extra rewards within the app, such as a discount or an extra treat.
In this competitive world, implementing a well-designed loyalty program can be a great tool for attracting and retaining customers. Choose loyalty program concepts that are compatible with your business and customer base and remember to keep evolving and innovating to stay ahead of the game. Your customers will appreciate the incentives, and your restaurant will benefit from their continued loyalty.