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Nourishing Your Restaurant Loyalty Program: How to Feed Patron Engagement (Part I)

The calendar may say spring, Major League Baseball’s opening game is set for Sunday (Go Rangers!) and tulips and crocuses are poking their heads above ground across dozens of northern cities. But as freeze warnings covered parts of the country this week, for many, a lingering winter chill remains.

For the restaurant industry their “economic spring” has also been delayed. Despite a wealth of “blooming” economic news – stocks are up, unemployment continues to fall and weekly jobless claims fell to their lowest level in five years – restaurant industry growth has been stuck in winter doldrums. According to the latest Knapp-Track Index of monthly restaurant sales, casual restaurant sales fell 5.4% in February, .6% in January and 1.6% in December. This was the first consecutive three-month drop in nearly three years. While some of those declines are sure to rebound once the weather warms arrives, it might also signal tight consumer spending and the specter of renewed economic troubles.

Faced with these uncertainties, restaurant loyalty programs are more valuable than ever in attracting, engaging and retaining patrons. It’s not so much that diners require coaxing via points-for-rewards gimmicks. Rather, as much as diners crave a great meal and great service, they seek loyalty programs that are accessible on their preferred channels, offer meaningful rewards and enhance their overall experience with the restaurant brand.

To that end, I’ve listed several suggestions that can help restaurants nourish their loyalty programs and better feed restaurant goers’ desire to enjoy meaningful rewards.

Rewards need to be… well…rewarding
That’s a line borrowed from Cynthia Boris in her March 11 Marketing Pilgrim blog. With data showing 58% of loyalty program members prefer to dine at eateries with rewards programs, there are strong indications that if restaurants improved their offerings, more members would join. That’s true even if the same study reveals only 36% of respondents are members of a given program. Too many restaurants make their loyalty program members jump through too many hoops to earn a reward or don’t offer rewards commensurate to customers’ outlays: no one’s going to eat at a restaurant full price 10 times just to earn a free T-shirt. But consider BJ’s Restaurant and Brewhouses’ Premiere Rewards loyalty program which offers rewards including a 5-course dinner valued at $30 per person. They also offer the chance to purchase items via points at auction. The latest offer: a Guinness-sponsored mountain bike.

Restaurant Loyalty Programs need better RewardsAnother great example comes from Savannah, Georgia. Welcome to Churchill’s Pub, an upscale, British-owned restaurant, wine bar and pub serving up English and contemporary American cuisine. Located in the heart of Savannah’s historic district, Churchill’s loyalty program accomplishes two important things.

First are the details of the program itself: accessible via iPhone and Android, Churchill’s Pub rewards app allows users to earn a point for every dollar spent; $100 earns $10 off wine cellar selections. Members also have access to special menu discounts, coupons and twice-daily happy hour pricing. Moreover, the app allows members and Churchill’s staff to communicate with each other, allowing for a more timely and relevant experience. Churchill’s cardless loyalty program is quietly showing the way forward. And the existence of this stand-alone eatery’s loyalty program helps dispel the myth that only chain restaurants require loyalty programs to generate excitement and repeat customers.

Get Your Game on
Dining out is supposed to be fun. And it isn’t just children, tweens, teens and 20-somethings playing video games (the average gamer is more like 30+). In fact, a recent study by Gigya, a company that builds social technology infrastructure, found that adding gamification to a website increases engagement by 34%. That breaks down into:

  • Commenting: up 13%
  • Social sharing to Facebook and Twitter: up 22%
  • Content discovery: up 68%

Beyond traditional word-of-mouth, restaurant review books and websites like Urbanspoon, gamification is a fun way to spark and sustain the conversation and keep it going.

Linking virtual points to real-world rewards is an added endorphin rush. So why not make pre-dinner planning equally entertaining? Take Rita’s Italian Ice, the Italian ices chain. Recently the brand created a new loyalty program, Rita’s Rewards. Timed to coincide with the first day of spring, the Rita’s Rewards app lets users share their Rita’s experiences via Facebook, write reviews and earn points toward free Italian ices. In May the app will expand to include a Rita’s Italian Ice Factory game. While details are unknown, the game’s working title suggests users will be able to create their own virtual flavors and dream up their own concoctions, earning additional points along the way. With chain restaurants like the Cheesecake Factory specializing in dessert offerings, similar sweet tooth incentives could apply here too.

The restaurant economy may have a bit further to go in realizing its own economic spring. But adopting these guidelines will help encourage new levels of patron engagement, increased revenue and a chance for your restaurant to help break this recent three-month sales slump.

So how else can restaurants nourish their loyalty programs and better feed restaurant goers’ desire to share in the rewards? Share your thoughts in the comment section below and look out for my 2nd blog post on this topic, “How to Feed Patron Engagement” in which I’ll be looking at the benefits of SoLoMo and the importance of loyalty program aggregation.

Kobie Marketing

Kobie Marketing