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Hospitality

Loyalty

Restaurant QSR Industry Customer Loyalty

The world of dining – which grew from $6.7 billion in 2022 to $7.2 billion in 2023 – is going through an industry transformation for everyone from QSRs to luxury dining.

By

Nick Lupo

4 Min Read

July 17, 2023

The ever-evolving world of dining – a market estimated at $500B+, is looking to technology to deliver an innovative customer experience ecosystem that is digital-first and drives repeat purchases with the ability to alter customer behaviors. Beyond driving repeat purchases through incentivized freebies, discounts, and perks, the industry is looking to the loyalty & mobile experience to provide a seamless, digital transformation for customers. 

Dining Loyalty Trends For 2023 and Beyond

 

1. Hyper personalization

Customization of offers, rewards, and customer experience is enabled by a sophisticated process of rich customer data collection, mainly through loyalty programs. Consumer demand for this type of personalization is high and almost table stakes at this point for brands. 

Brands will continue to evolve and experiment with personalized menu items via digital menu boards, apps, dynamic pricing, and unique offers based on the 360-view of individual customers. The digital transformation of this industry will continue to push brands in this personalized-focused way of interacting with consumers. 

2. One-Size Fits All, Does Not Fit All 

In a sea of cookie-cutter loyalty programs in the restaurant industry, one size does not fit all. To have a successful loyalty program that drives repeat business, helps increase engagement, and steals market share from your competitors, it must be unique and intentional to your business. Using a loyalty vendor that simply streamlines and replaces stock images and colors to create your program from their standard shell will not drive ROI in today’s competitive landscape. 

Loyalty programs should be a reflection of your brand – differentiated and custom-built with your customers in mind. 

3. Gamification 

More and more industries are incorporating gamification strategies into their loyalty programs, and the F&B industry is no exception. Gamification is more than just a buzzword; the right strategy can unlock specific behaviors, drive restaurant traffic, motivate engagement, and more. Gamification helps move your loyalty program away from being largely transactional with more stickiness and increases customer engagement. Clearly defining the goals behind your gamification strategy is crucial in turning these interactions into deliberate opportunities for your brand. 

4. Digital is the Future, but Don’t Restrict Customers 

There’s no doubt that digital is the future of loyalty for the restaurant industry, but forcing customers to 100% go digitally might turn away some customers from your loyalty program. Communicating and engaging with your customer in their preferred channel has always been critical in effective loyalty marketing. Blocking a loyalty member from the program’s benefits because they do not have a smartphone or prefer to order without a phone will not keep that customer loyal or happy. Adding avenues to participate in how they want to engage with the program is critical for success. 

 

Restaurants Changing the Game in Loyalty 

 

Now that we have looked at some of the top trends dominating F&B loyalty, let’s also look at the leading examples of brands that are taking a bite out of their competitor’s share and winning over customers.

MyMcDonald’s Rewards 

The iconic golden arches took the industry by storm when they launched a true loyalty program in the summer of 2021. The program added 26M+ members in its first year (now at 50M+ members in their top six markets) with a high engagement rate that drives their digital sales with significant increases each quarter. 

The loyalty-based app is a spend-and-earn program allowing members to gain points based on spend to redeem free food and beverage items. Their program is simple, without member tiers or engagement incentives but offers a plethora of channels on how to use the app – order ahead, in-store, or drive-thru with a unique code. Another great feature of the program is how quick and easy it is to reward yourself with free food – new members receive a large order of fries for simply downloading the app. Members can redeem their first free item after only spending $15 with the chain. The loyalty app also features unique deals for members and has recently rolled out bonus point opportunities for dayparting. 

Chick-fil-A One Rewards 

You can’t mention F&B loyalty programs without highlighting the Chick-fil-A One Rewards program. This program has a long history as the industry standard in sophisticated loyalty programs for QSRs. Functioning as a typical spend-and-get program, Chick-Fil-A takes its program one step further by adding tiers where loyal members receive better exchange rates on earnings and additional perks and benefits. 

Higher-status members receive many benefits for being loyal, with many ‘surprise and delight’ freebies from your favorite location, exclusive experiential experiences such as the Chick-fil-A home office tour, birthday benefits, and more. 

Chick-fil-A has recently launched a gamification initiative to drive engagement through weekly missions and rewards. ‘Code Moo’ features the lovable Chick-fil-A cows as they try to sabotage their burger-flipping nemesis, Circus Burger, with 2.5 million food rewards available each week. This gamification-based campaign provides an interactive experience for members and allows them to win rewards and prizes.

 

Domino’s Pizza Piece of the Pie Rewards

Domino’s is one of the world’s largest pizza brands, with a presence in over 90+ countries. Their Piece of the Pie Rewards program is an extremely popular program where members can earn 10 points every time they place an order of $10 or more. Members can redeem a free pizza once they reach 60 points or save for multiple free pizzas later. Domino’s makes it easy to earn more pieces of the pie with points being earned any way you order – by phone, in-person, online, or in the app. 

Capillary’s client, Domino’s Pizza Indonesia, adopted a customer-centric strategy by utilizing the Capillary platform to engage with customers by creating personalized customer journeys in various social channels. Capillary segmented the customer data into 170+ digital touchpoints across 40 campaigns that achieved results of an increase in 10% active customer base, 85% high incremental sales, and a 21% increase in overall sales. 

Carrabba’s Dine Rewards

As we step across the ocean for some classic Italian dining, customers can get above and beyond in the Dine Rewards Carrabba’s loyalty program. Their spend-and-earn program allows customers to accrue rewards for dining in exchange for perks, free dinners, and other incentives received through email.

To receive your rewards after your visit, or take-out experience, Carrabba’s has decided to forgo any digital experience during the buying process and requires only a simple phone number from the rewards account written on the receipt at the end for the waitress to implement. Simple as that.

When you join the Dine Rewards program, you’ll earn a complimentary Calamari instantly. You can also be the first to find out about new menu items, upcoming events, and exclusive news when you sign up to receive emails from them. It is a well-oiled loyalty program that continues to bring back customers through its doors daily.

Restaurant loyalty programs will continue to play a critical role as the secret ingredient in driving growth in the F&B industry. Restaurants that are the most successful will leverage their loyalty programs to achieve and utilize zero and first-party data, unlocking the power to create personalized, differentiated loyalty programs and experiences for unique customers. All this will drive customer loyalty, increasing repeat business and profitability. Connect with one of Capillary’s F&B loyalty experts to learn how we can help your business today. 

Nick Lupo

Nick is the Senior Marketing Content Specialist for the Americas and has 15+ years of experience as a global marketer with a demonstrated history of working in loyalty, moving and storage, internet security, insurance, luxury real estate, SaaS, and more.

Aauthor Name

Nick Lupo

Nick is the Senior Marketing Content Specialist for the Americas and has 15+ years of experience as a global marketer with a demonstrated history of working in loyalty, moving and storage, internet security, insurance, luxury real estate, SaaS, and more.

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Restaurant QSR Industry Customer Loyalty

by Nick Lupo

July 17, 2023 | 4 Min Read

The world of dining – which grew from $6.7 billion in 2022

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