COMMENTARY

2 ways to 'lengthen' loyalty without cutting into your bottom line

| by Dave Bennett
2 ways to 'lengthen' loyalty without cutting into your bottom line

Most QSR operators today understand that a great loyalty program is a business necessity, but like everything in the restaurant game, there is a huge difference between doing it and doing it well. And when it comes to loyalty, the QSRs that really know how to maximize the benefits to the brand and its customers will be the QSRs that reign supreme.

And when it comes to "lengthening loyalty impact," two particular areas not only often get overlooked by brand leaders, but when employed can serve as something akin to restaurant steroids when employed correctly. Those two area are loyalty program alternative rewards and member data mining. Together they can breathe new life into your loyalty and new loyalty into your brand.

Alternative rewards

The most common tool QSR leaders use with their brand's loyalty program is the most obvious one:  coupons or discounts. But if your brand's loyalty members are already paying full price, why would leadership want to turn them into discount diners? This becomes even more absurd a thought when you also consider that you already have all the tools you need to offer these customers something more valuable. 

After all, a loyalty program gives brand leaders detailed information about the brand's biggest fans and their preferences. That information is worth its weight in gold in helping operators build even more loyalty through perks that don't perks that don't necessarily impact the  "books" like continued discounts and other monetary rewards.

Instead, think of using your program to "listen" and engage with your customers to learn what kinds of rewards they really want. By providing these more targeted products and services  to your brand's best customers, you maximize the benefits of your loyalty program. 

The typical QSR's profit margins are small enough without adding to the deficit column by continually rewarding loyalty members with the money that could be building profits. Instead, restaurateurs can often make an even bigger impact with other exclusive perks that take the place of direct financial rewards, while also making for even happier customers and encouraging even stronger loyalty. 

Think about options like birthday perks and members-only special events, for instance. Your brand is only limiited by your team's creativity and leadership's overall goals around loyalty efforts. It won't cost you as dearly as those BOGO offers, but it will still put smiles on customer faces and keep them coming back.

Loyalty program data: Use it or lose 

If you're not integrating guest loyalty information with sales data, you are missing a huge business growth opportunity. For instance, you can examine frequency of visits by individual customer, which location or locations are frequented and how much is spent. Combine this vital data with patterns like how much they spend now, compared to last month or last year, and whether the individuals use coupons or other discounts, and you have the kind of information that can best direct your future efforts for maximum impact.

In fact, by combining sales and guest loyalty data you can track customer patterns based on purchases and create LTO's to market to these kinds of loyal patrons. You can then simultaneously track the success of such promotions by monitoring customer activity and repeating the promos that worked best, while perhaps also pushing products with higher margins.

Loyalty data also allows you to see things like which customers spend the most at the drive-thru window, for instance, by pulling a report showing all customers that spend more than a certain dollar amount in the drive-thru. This can provide more information about what these top spenders commonly purchase, times of day for their visits and other information that allows leadership to target that willing-to-spend customer through favorite food group or meal-time specials or even messaging that amplifies your customer connection.

The bottom line is that there's a lot of data loyalty customers leave on the table and the top QSR brands are those that pore over that information and reward loyalty in ways that pay the most returns to the brand. 

 


Topics: Business Strategy and Profitability, Financial News, Loyalty Programs



Dave Bennett
With prior experience with Dunkin’ Brands and IBM Global Services, Dave Bennett has led Mirus through its formative years and its current growth phase. Dave holds a B.S. in Business Administration and MBA from Northeastern University. www

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