Why is Roti paying customers to download their app?
Roti just did something brilliant. They are “paying customers” to download their app. Like other brands who offer an intro reward for enrolling in loyalty, Roti is gifting a $10 reward for signing up, but by promoting the incentive this way, they will surely get the attention of many of their loyal customers who otherwise wouldn’t have gone to the trouble of adding yet another app to their phone.
You might be saying to yourself…a $10 credit is pretty expensive for a simple app download. Doesn’t that investment go against everything you have been recommending around non-discount rewards? No. Here’s why…
First, this level of investment shows me that Roti has done the math and understands the value of enrolling customers in their loyalty program. Many brands hesitate to offer an “expensive” introductory reward, concerned that too many guests will cash in, then never come back. That argument only holds water if your loyalty members don’t spend significantly more than your non-members. I’ve never once seen an example of this. Taco Bell saw a 35% increase in spending after guests joined their loyalty program. Takeout loyalty members spend twice as much as non-loyalty members.
For example: Say non-member revenue per customer per period is $100 vs. $135 for members, that’s $35 of incremental spend to play with (and that’s just during the single period being measured, now multiply that by the # of periods in lifespan of an average loyalty member)! $10 once is a small price to pay for what is clearly significantly higher revenue per customer over time.
Second, one of the big concerns with discounting is that you are training guests to wait for coupons or discounts before making a purchase. With this promotion, Roti is rewarding a non-transactional, one-time action not setting an expectation of future discounts.
Finally, app downloads at Roti = automatic enrollment in loyalty = purchase tracking = more personalized outreach. Now Roti can engage with those guests, track their purchases, send them relevant communications, and build a relationship that ultimately increases cLTV. What’s the dollar value your team places on adding one more active customer to your database? If you don’t know the answer, maybe you should.
*For transparency, Roti is a Thanx customer.