Loyalty isn’t dead. It just needs a reboot. Or better yet, a new definition.
Welcome to the first issue of the Loyalty Disrupt newsletter. We’ll keep you up to date on restaurant loyalty news, tips and tricks from our loyalty experts, updates on our new Loyalty 3.0 platform and whatever else we dream up.
Uber just launched a new subscription service that should have restaurants scared as hell.
The UberOne membership program should have restaurants shaking in their boots. The subscription service offers perks like 5% off all rides and orders, a $5 credit when your order is late, no delivery fees so long as the order meets a minimum purchase threshold, and “novel perks including special offers and exclusive experiences”. Their director of global membership marketing offers examples such as cooking along with a celebrity chef virtually and date night deals at your customer’s favorite delivery restaurant with a ride on Uber.
If this isn’t validation that restaurants need to up their loyalty game and give customers a reason to order directly, then I don’t know what is.
McDonald’s Loyalty Program is growing faster than any restaurant loyalty program ever but don’t blindly follow.
McDonald’s just hit 21 million members in their mobile loyalty program in just shy of six months. And last month, more than 2.8 million users downloaded their app, a requirement to participate in loyalty, the most of any quick-service chain by more than double (Starbucks had the next most with 1.3M). But seeing these results sends the wrong message to most restaurant brands.
For most, an exclusive focus on loyalty programs that require an app download doesn’t make sense because let’s face it, most people don’t want a hundred restaurant apps on their phone. In fact, more than ~80% of the digital orders placed on Thanx online channels happen outside of a mobile app. By forcing your customers to bend to you and download your app, you risk alienating a big chunk of your customers.
Velvet Taco is kick ass, bad ass AND hard ass.
Velvet Taco’s new loyalty program, The Velvet Room, just launched a few weeks ago and embraces many of the philosophies that we at Thanx hold dear. It’s a tiered, visit-based program that rewards guests with unique offerings and VIP experiences without leaning into traditional discounts.
The tier names alone, which include “Kick Ass,” “Bad Ass,” and “Hard Ass”, give customers a glimpse into what they can expect from the fun and edgy brand if they join the program. And with surprise and delight rewards, such as a chance to earn a trip to attend an exclusive Weekly Taco Feature tasting, it’s no surprise (pun intended) that they’re already starting to see results.
Burger King Rewards with cryptocurrency is an interesting, while expensive, idea.
One of the more interesting recent loyalty promotions comes from Burger King’s partnership with Robinhood, the retail investing app that just can’t get enough of being in the news this year. The brand announced a promotion in early November wherein loyalty program members who spent $5 on any food item receive cryptocurrency in their Robinhood account.
The promotion resulted in strong download activity for the Burger King app (new installs grew 30% during the promotion compared to the same period). The promotion, of course, has a give-get but what’s most noteworthy about it is that Burger King effectively pounced on a hot trend.
And while we at Thanx don’t recommend an exclusive focus on heavy discounting, there is a relevant takeaway: listen to your customers and deliver value that is relevant to them today.
As the Head of Customer Success at Thanx, Tricia has overseen the launch and evolution of more than a hundred restaurant loyalty programs. She knows what works and what doesn’t. Here are some of her top recommendations and reminders as we close out the year.
#1. Make sure you have a digital sign-up incentive
The introduction of digital ordering has fundamentally changed the necessary give-get of loyalty sign-up incentives. With guests already entering their info in exchange for the convenience of ordering online, you only need a small incentive to encourage loyalty sign-up. But better to have something, than nothing. If you don’t have a clear, visible incentive to enroll, it’s time to set one up, ASAP.
#2. Remove guest checkout
You might be thinking, “but what if some of my customers won’t create an account? Will I alienate them and lose revenue?” The answer is, no, not only will you not lose revenue, you will likely see increased conversions, higher average tickets, and skyrocketing repeat traffic especially if cookies and one-click reordering are also enabled. That’s because the convenience of not having to log-in and re-enter info every time you want to place an order drives repeat traffic. Don’t believe me? Oath Pizza saw a 12% increase in order volume in the first month after they turned off guest checkout.
#3. Optimize the digital ordering checkout flow for database enrollment
Make it obvious why guests should enroll in loyalty after they have already entered in all of their information. Couple the choice to opt-in with the value of doing so today. In Thanx, this looks like a big “Save and Earn Rewards” button at the moment of purchase with a clear indication of what that incentive is. And, of course, don’t forget to encourage ordering direct to your third-party delivery customers through bag drops and other strategies.
#4. Make your intro offer available only online
Driving sign-ups online is so much easier than driving sign-ups elsewhere (and it’s inexpensive if you listened to my advice in tip #1). For that reason, we recommend making your sign-up offer only available for online redemption as a way of driving customers to your mobile, web, and other online ordering experiences where enrollment is a cinch. Easier enrollment means better customer data so you can provide personalized customer experiences and targeted marketing.
#5. Limit redemption risk
Last but not less, be sure to require a minimum purchase for redemption (meaning, the reward can only be applied to a purchase over $X) to protect your team from lopsided redemption exposure. This way, you can be sure that discount seekers take a hike.
Want to talk to a Thanx loyalty expert about how to improve your program?
“Non-discount” Reward of the Week
Taco Bell is hosting a Cantina Celebration in Times Square for New Years and the only people who can get in are their top tier “Fire” loyalty members. Now that’s a fire loyalty reward if you ask me!
Found a unique “non-discount” reward that you would like to share?
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