Find out the different ways that QSR’s are using their loyalty programmes
Loyalty programmes continue to be a powerful revenue-generating tool for QSR’s as some reach hundreds of thousands of members, and delivering a huge chunk of in-store traffic and transactions.
In our continuing series of interviews, we find out that bonus cards remain the most popular kind of loyalty program – although technology advances could re-shape the way rewards are redeemed – with restaurant chains reporting brisk member growth and tremendous repeat-visit revenues.
Foodco Group’s Jamaica Blue, for instance, saw its flagship Caribbean Crew loyalty program surge 58% to 165,000 members last year. “Jamaica Blue saw more than one-million transactions made by Caribbean Crew club members – that is, 19% of last year’s total transactions in-stores,” estimates Serge Infanti, Managing Director of Foodco Group.
Its sister bakery café franchise Muffin Break has also grown its loyalty program to roughly 365,000 card members as of last year. “In conjunction with other coffee-related promotions, the Muffin Break Club helped to increase coffee sales by 11.3% last year - that is, a total coffee growth of $5.429 million,” said Infanti.
What draws them in and convinces them to stick around? Appealing rewards that exceed customer expectations seem to do the trick.
He said Caribbean Crew club members earn free coffee and enjoy a cake slice on their birthday upon presenting a smart card on point-of-purchase in any Jamaica Blue branch in the world. Meanwhile, Muffin Break club members receive their fifth coffee purchase free “unlike competitors’ loyalty cards which call for a higher number of prerequisite purchases.”
Pacific Retail Management’s Go Sushi similarly banks on the well-worn appeal of freebies. Its Buy 5-Get 1 Free cards are still in use, although more could be done to expand this loyalty program, said Nicola Mills, MD, Pacific Retail Management.
“We believe loyalty programs can be a good way of engaging with and rewarding your regulars, however it isn’t something we haven’t explored to its full potential,” said Mills, noting that its less established franchise Wasabi Warriors has no loyalty program. One will only be launched “should more stores open.”
But there is an argument for starting loyalty programs right from the get-go, because the longer it is in place the more memberships seem to snowball, at least based on the experiences of Retail Zoo brands.
The loyalty program for Boost Juice Bars, for example, now counts over 700,000 members since the program began in 2008, said Brett Carman, GM, Salsa’s Fresh Mex Grill. Salsa’s Fresh Mex Grill has had relative success as well, with its Salsa’s Mex Club growing to 40,000 card members in just two years since the loyalty program started.
“Considering the relative youth of our brand, and with seven times less outlets that Boost, we’re on track to engineering a strong program moving forward,” said Carman.
Aside from traditional wallet cards, bonus fridge cards are still a mainstay for home-delivering franchises like Pizza Inn, although there has only been mixed support from stores and customers to either loyalty program, said Ron Browne, Franchise Manager, Pizza Inn.
Technology minded QSR’s are also exploring more loyalty programmes tied into the use of smart phones which has become as indispensable as, if not more than, wallets when going out.
Lord of the Fries said it has teamed up with Wealie, a loyalty program for smart phone users, which allows consumers to scan in a QSR code when they purchase a meal in store, with multiple purchases resulting in a free meal. “The response has been great. It's in line with our ethos as it's environmentally sound and taps into our core market, 15-45 year olds,” said Sam Koronczyk, one of the owners and co-founder, Lord of the Fries.
Serge Infanti of Muffin Break said the chain’s popular loyalty program is looking to develop smart-phone apps and SMS marketing features as well.
It’s clear that technology is advancing to the point where not only the transaction medium is moving from physical card to a digital card, but is also unlocking powerful loyalty analytics. Muffin Break can already analyze customer behavior and identify occasions for reward with single swipe of a card through a digital terminal, and other QSR’s seem to be catching up fast.