The fastest way to someone’s heart is through their stomach, right? So it’s no surprise that brands in the food and beverage industry are going gourmet with next-level fast food and restaurant loyalty programs — filling your pockets and belly at the same time.
Looking for a hot, inspirational example on how to do restaurant loyalty programs right? Check out our case study on KFC UK & Ireland’s Rewards Arcade.
Consumers love rewards, but most rewards programs aren’t optimized for long-term engagement. Brands at the top of the food chain have designed their loyalty programs with convenience, plenty of touchpoints, and longevity in mind. And to achieve that, they are investing in delivery app solutions where they can easily introduce their programs. Such programs have succeeded in reinforcing brand loyalty and increasing restaurant customer retention among frequent customers through the use of exclusive discounts, VIP access to products, preferential treatment, and more.
There can be no doubt that it has been a very tough few years for the restaurant industry. From a loyalty management point of view I believe the biggest challenge for restaurant loyalty programs is around the customers’ expectation of service. Customers expect more these days and our options are infinite, so brands must get this right. Technology solutions have had a big part to play in this, especially in restaurants where systems like order at table have proliferated much faster than perhaps they would have, as a result of the pandemic. Restaurants need help innovating in the right technology solutions.
Let’s grab a seat at the table with seven companies that are serving up exceptional restaurant loyalty programs for their customers. Bon appétit!
Key Takeaways — TL; DR
- The sales in this vertical are rising, but so are prices
- Tailored loyalty programs can be a lifeline for restaurants
- QR codes are making a comeback
- Gamification, experiences and app-based engagement are the future
- We gathered 7 loyalty program examples for inspiration
Table of Contents
What Are Restaurant Loyalty Programs?
A restaurant loyalty program is a type of reward system that’s created to address the needs and requirements of a restaurant or fast-food chain. Restaurant loyalty programs are characterized by:
- A strong focus on app-based engagement, including digital loyalty cards and receipt scanning
- Prevalent use of freebies, which are either free food items when customers make a specific number of purchases or the addition of free extras on special occasions, like birthdays
- Frequent use of the earn & burn model as the core program structure
- The use of a mix of incentives, such as coupons and physical items like branded merchandise
Value creation is a substantial facet of the next Restaurant Strategy. Fast-casual and fast-food brands are going to face the biggest opportunities of the last 10 years. And it will involve delivery and take away service! However, people are not looking for discounts. They want to belong somewhere, even if it means purchasing more frequently. Loyalty should focus on this sense of belonging.
The Biggest Customer Retention Opportunities for Restaurants
The restaurant industry is looking at a promising but also challenging future. On one hand, this vertical is forecasted to reach $997B in sales. However, the rising cost of food supplies and the cost of living crisis may lead to difficulties when it comes to customer retention, as customers think twice about which restaurant or fast-food place they spend their hard-earned money.
Restaurant loyalty programs are one tool that can increase the relevancy of restaurants. According to Antavo’s Global Customer Loyalty Report 2023, 88.5% of respondents trust customer loyalty to help them overcome the inflation crisis and potential recession.
One of the ways restaurant loyalty programs can achieve this is by focusing on experience and personalization. Utilizing gamification or rewards that are experiential in nature makes each visit memorable and custom-tailored.
Advances in technology have enabled restaurants to create highly personalized loyalty programs that utilize data gathered from customer interactions to provide tailored offers and better overall experiences. To build long-lasting loyalty among their audience, restaurant brands should create rewards programs that are personalized and tailored to each customer’s needs, habits, and preferences. The program should incentivize customers to visit often by offering discounts, exclusive promotions, and unique deals that are only available to enrolled members.
Boosting Engagement and Communication – QR Codes and Loyalty Apps
Smartphones are still an area that restaurants can tap into in order to create more touchpoints with customers. Forrester pointed out that QR codes made an unexpected comeback in the sector, linking patrons to menus, ordering, and payment.
The adoption of QR codes or loyalty apps that can be used to place an order in advance can be easily boosted with a loyalty program. Reward systems are all about changing customer behavior, so offer points, badges and other benefits that incentivize customers to give your QR codes a try.
Restaurants need to take back control of the relationship with their customers before and after the dining itself, and use that to foster a sense of community and discovery: from a customer perspective, it means that the restaurants worth going to will increasingly sit outside of commoditizing platforms, and will each have their own communications and loyalty programs, just like they have their own menus.
The Best Features to Help Your Restaurant Loyalty Program Stand Out
In case you are looking to launch or revamp your restaurant loyalty program, keep in mind the following features, strategies or technologies.
There Is More To Loyalty Programs Than Points and Tiers
Though earn & burn program types are somewhat of a staple within the industry, innovation sometimes calls for some experimentation. For example, you can create a hybrid structure by adding tiers to the mix. After all, customers love tiers!
If you have a specific goal in mind, there is a loyalty program structure that will support it. For example, perk programs are ideal if you seek to provide instant gratification and want to foster a community. Gamified programs, however, typically use badges and challenges to build new habits among patrons.
Restaurant loyalty programs can build long-lasting loyalty with their audience by being digital first: paper-based loyalty cards are out-of-date. Restaurants should rely on a digital loyalty program to enable a seamless customer experience. Also, they should focus on quick burn: the key lever for restaurants is frequency, not an increase in the average purchase sum. That’s why they should rely on fast earning and burning and provide incentives after almost every customer interaction, giving the customer an immediate reason to come back.
Expand Your Reward Portfolio, But Don’t Forego the Tried and Tested
Many restaurant loyalty programs still resort to coupons and freebies. This isn’t necessarily an issue—patrons would revolt if you would take freebies out of the offers—but you should think of other reward types that will spice up the experience. Branded merch is definitely a crowd-pleaser, but allowing top-tier members to help design or name new menu items is also worth considering.
As for high-tier restaurants, coupons and freebies are out of the question, because they cheapen the experience, right? Not necessarily. For example, you can offer a full dining experience for free, but as a premium reward… with a premium price tag in points.
The hospitality industry is a highly competitive market and we are seeing great shifts toward more experiential loyalty. We see that brands are changing the language they use to communicate value from discounts to member-exclusive pricing and promotions, and from bonus points to premium benefits. They are investing in more ways to offer broader value through a differentiated and memorable experience through the entire customer lifecycle irrespective of whether it’s online or offline. By offering the right balance of rational, emotional and sociocultural benefits, firms can continue to deliver sustainable value for both their customers and their brands.
Tailor Gamified Loyalty Program Elements to Drive Your Unique KPIs
Gamification might be a buzzword that’s often thrown around, the truth is that most of its potential is still left unexplored. For example, restaurants can keep patrons on their toes by using systems like Spin the Wheel to randomize what freebies patrons receive.
Creating digital collectibles that are awarded to customers who accomplish certain feats (such as making X visits per year, or buying Y amount of the latest menu item) is also a great way to get customers out of their comfort zones, increase their engagement, or introduce them to new things.
Restaurants need to stand out and make their way to the top by providing VIP treatment to their best customers. Nice decor and great cocktails aren’t enough anymore – a true feeling of recognition and appreciation is what they are looking for! A good loyalty program also needs to give restaurants the opportunity to be innovative and different from the competition. It has to offer more value to customers: gamification, rewards, and, most of all, the feeling of being valued and essential to the growth of the brand in which they are choosing to spend their money.
Streamline the Interactions Using Loyalty Passes or Loyalty Apps
Patron’s smartphones are the gateway to a brand-new form of customer interactions. From reserving tables and ordering in advance, to scanning QR codes for special, members-only treats, to playing a mini-game while waiting for the meal, the possibilities are endless.
As a starting point, it’s recommended to implement either a loyalty pass that can be used to identify patrons or a full-on loyalty app that includes a membership ID. The use of these systems can be encouraged by offering points, rewards or badges in return for key engagements.
A major trend I’ve seen in the loyalty space amongst restauranteurs over the past few years has been to wrap the loyalty experience around core utility functions — mapping the customer journey for loyalty around mobile order and pay, delivery, pickup, order readiness, seating waitlist and so on. This trend accelerated with the pandemic and reflects customers’ desires to perform tasks digitally rather than through human interaction, or at least to have the options of digital and human interaction.
7 Inspiring Restaurant Loyalty Programs
Here’s a list of real-world restaurant loyalty programs you can use as inspiration or as benchmarks for your own loyalty concept.
1. Dunkin’ Donuts Rewards Program: Priority Service
With over 12,000 shops in 45 countries and over 8 million loyal customers across the globe, Dunkin’ Donuts stores see a lot of traffic each day. Knowing that people hate waiting in long lines, the company utilizes priority services as the main selling point for its restaurant loyalty program, DD Perks.
The most popular use of the membership is placing orders using the company’s app, so customers can instantly claim their orders when they arrive at the store. Loyalty members also earn 5 points per $1 spent and can use the points toward gift cards.
Dunkin’ Donuts’ rewards program also has a number of clever additions, such as a free birthday gift card. Moreover, thanks to a partnership with Idle-Empire, customers can earn bonus points for playing games and answering survey questions, which is a great source of zero-party data.
Why it works:
- Priority service and early access to upcoming new dishes are not only highly alluring loyalty program features but are also relatively inexpensive.
- Offering priority service to app users is also a great way to promote an omnichannel experience.
- Awarding points for activities other than purchases keeps engagement levels high.
- Using an earn & burn style program does not make a brand stand out, but it does keep the rules simple, which is great for fast-food brands.
2. Chipotle Rewards Program: A Diverse Reward Offering
To reward customers in a fresh way, Chipotle ditched the traditional punch card in favor of a fully mobile experience called Chipotle Rewards.
- The exchange ratio for the loyalty currency: for every dollar they spend, users earn 10 points on their virtual card.
- New members receive free chips and guacamole after their first purchase.
- Rewards include free Chipotle orders and branded merchandise.
- Members of Chipotle Rewards can use the dedicated app to easily reorder their favorite Mexican dish or scan their receipts.
The benefits of being a member of the Chipotle Rewards program don’t end here, as the restaurant has a couple of gamification and surprise & delight elements up its sleeve. For instance, customers can earn various badges by completing challenges and receive surprise offers on their birthdays.
Why it works:
- Chipotle has made multiple kinds of rewards available, from freebies to early access & merchandise.
- Chipotle has cleverly integrated its mobile app into the reward journey.
- Badges and birthday rewards are a great way to spice up the experience for customers, at a relatively low cost.
3. Famous Dave’s Rewards Program: App-based Benefits
The award-winning barbeque restaurant Famous Dave’s has a loyalty program that is known for two things: its ribs-themed reward system and its smartphone app.
- Every $1 spent equals 1 Bone, which is the program’s currency.
- Collecting 100 Bones gives customers a $10 discount on their next order.
- The loyalty program is available on a smartphone app, which also promotes the user’s nearest Famous Dave’s restaurant.
- Downloading the app gets users a one-time gift: a free burger with the next order.
Famous Dave’s restaurant loyalty program uses more than just rewards to build a loyal follower base, however. The company stays in touch with its members, telling them about the latest updates or offers in a personalized way. This is an extremely good way to build a like-minded community and show that being close to the brand is about more than just food and rewards.
Why it works:
- Famous Dave’s loyalty program is simple and easy to understand.
- The app can be used for identification in the store.
- The brand engages in personalized communication with its members.
4. Chick-fil-A Rewards Program: Tiers & Experiential Rewards
As the originator of the classic, pickle-topped chicken sandwich, Chick-fil-A needed a loyalty program to match its image. It pretty much sums up all the neat little features we listed above: loyalty points that can be exchanged for free meals, birthday rewards, and an app that handles both orders and the loyalty currency.
However, Chick-fil-A One goes even further by implementing some truly next-gen restaurant loyalty program elements. The most notable is their tier system: by default, customers earn 10 points per dollar spent, but reaching higher levels increases the points-per-dollar ratio up to 13.
Higher Chick-fil-A membership levels also unlock better rewards, including access to the backstage tours at the Chick-fil-A Home Office and the ability to share the rewards with friends and family members. Overall, a higher tier means a better experience for members.
Why it works:
- Chick-fil-A offers a highly engaging and long-term loyalty program thanks to its tiered system.
- The program provides everything customers have come to expect from a restaurant loyalty program, in one attractive package.
- The program even offers some experiential rewards, like the backstage Home Office tour.
5. La Cage Rewards Program: Rewarding Sports Fans
Canadian sports restaurant chain La Cage revamped its Club Cage loyalty program to focus on rewarding customers beyond dining. Its new loyalty program is now available in 52 restaurants run by the company.
- Customers earn 10 points for every dollar spent at La Cage’s restaurants or on home delivery.
- Members can also earn points by referring friends and completing their customer profiles.
- Loyalty members can use their points to pay for purchases and claim rewards.
One key highlight of La Cage’s loyalty program is its free wings deal. A sports bar through and through, the company runs a long-standing promotion in which, when the Montreal Canadiens score 5 goals, members receive 8 free wings with a $15 purchase.
Why it works:
- Club Cage follows the next-gen restaurant loyalty program model, where higher tiers increase the number of points earned with purchases.
- La Cage rewards friend referrals to build a larger community.
- The free wings offer aligns the brand with hockey fans and makes the restaurants a must-visit during matches.
6. KFC Rewards Arcade: A Truly Gamified Experience
KFC UK & Ireland previously ran a stamp collection program, but they wanted to shift their focus towards gamification and instant rewards. With the help of Antavo, they revamped KFC Rewards Arcade which now allows people to win freebies instantly, more often, and in an entertaining way.
For every order over £3, members receive an in-app invitation to play a colorful, arcade-style 3D minigame, in hopes of winning one of the 12 finger lickin’ freebies. One of these games is called Hammer Time, where participants can choose from three different hammers to swing, just like in a carnival.
With its new loyalty program, KFC UK & Ireland increased reward redemption by 40%. Download our case study to learn about the program’s other results.
A truly game-like feature like this can have an incredible effect on customers’ level of engagement, especially among friend groups, who are compelled to watch each other try their luck. The program also provides an additional element of surprise and delight because customers never know what prize they’ll win.
Why it works:
- KFC UK & Ireland connects with its customers’ inner gamer.
- Gamified features provide instant gratification.
- The randomization of rewards creates a thrilling experience.
7. Red Lobster Rewards Program: Partnership Benefits
Specializing in seafood, Red Lobster is an American casual dining restaurant chain with over 700 restaurants worldwide, including the US, Canada, Saudi Arabia, the United Arab Emirates, Qatar, Mexico, and Japan. As such, the My Red Lobster Rewards program has a lot of expectations to live up to.
- Members spend $1 to earn one point. After every 125 points, members can choose from three different freebies for their order.
- New members earn 75 points when they enroll.
- There are three tiers in total, with benefits like free birthday gifts, double points for to-go orders, early access, and unlimited games on in-restaurant tabletop devices.
My Red Lobster Rewards also hosts a range of limited-time partner offers. For instance, members can earn 10¢ per gallon up to 20 gallons at Shell for every $50 in qualified purchases at Red Lobster. Such deals make membership even more valuable.
Why it works:
- My Red Lobsters Rewards has a tier system with a great range of rewards, ensuring long-term customer engagement.
- Some of the rewards in the loyalty program promote restaurant visits, which are more memorable than online orders.
- Cross-brand offers increase the value of being an active member.
The Last Bite
Restaurant loyalty programs are superb assets for food industry leaders who want to drive repeat purchases and increase engagement. Just remember: you can go either super streamlined, focusing on freebies and hassle-free experience (backed up by a strong focus on mobile), or create an incremental progression where tiers influence how many points members earn for their purchases, coupled with plenty of level-specific benefits.
If you’re interested, Antavo can help you create a loyalty program custom-tailored to your brand’s identity. Simply contact us or send us an RFP.
And don’t forget to download Antavo’s Customer Loyalty Report, an in-depth report that showcases dozens of statistics and future industry trends to help you navigate the world of next-gen loyalty programs.
