Keeping your customers engaged – it’s one of the trickiest hurdles for today’s hospitality brands. With a market flooded with choices, it’s harder than ever to stand out among the crowd and build a returning customer base.
Loyalty programs – as well as loyalty rewards – can be a wildly effective way to communicate personally with customers and keep them coming back.
In fact, 56% of customers are willing to spend more with brands they’re loyal to, even if cheaper options exist elsewhere. That is the power of great customer engagement – and a successful loyalty program including a loyalty app can help make that happen.
To navigate a successful customer loyalty program and boost your brand’s customer loyalty ratio, you’ll need to focus on data-driven restaurant technology. Here’s what you need to know about loyalty apps in the hospitality industry.
WHAT IS A LOYALTY CARD APP?
A loyalty card app is a digital replacement for physical loyalty cards, and they’re the way forward if you want to not only improve customer loyalty but also open the door to reward customers and personalized offers.
Rather than carrying around (and usually losing) a card, customers store their points on a loyalty card app. It’s a loyalty program that’s a sustainable, hassle-free alternative to printed cards, and one that helps businesses collect loyalty data and interact more effectively with their customers.
Why Your QSR Needs a Loyalty Program
Building customer loyalty is the single most important aspect of retaining business and boosting profits in the long run.
WHAT IS THE DIFFERENCE BETWEEN A LOYALTY CARD, LOYALTY CARD APPS, AND A LOYALTY PROGRAM?
“Loyalty” is a term tossed around a lot at the moment. At its core, loyalty takes consistent excellence from a brand – but loyalty apps can help facilitate customer retention and engagement.
We’ve seen that targeted marketing and personalized experience are the future of customer service – and will fuel customer retention at the same time – but getting there means taking an intelligent integrated approach.
Strong brands start by building a loyal customer base, quickly converting new customers to advocates. But there are a few basic methods of tracking brand loyalty. Here’s a quick differentiation.
Loyalty Cards
Loyalty cards are physical “buy 10, get 1 free” style cards you most often see in coffee shops and small businesses for rewarding customers. Customers collect stamps or punches to receive rewards. While they’re easy to implement, loyalty cards can be a bit clunky.
Customers can lose their card, or forget they have it. Not to mention, paper cards offer no analytical data for the business. It’s a 20th-century solution to encourage loyalty in-store, but a stamped bit of card doesn’t provide any meaningful insights or customer feedback, and won’t necessarily reward anyone who isn’t already a convert to your brand.
Loyalty Apps
Loyalty apps are streamlined digital versions of loyalty cards. They are smartphone apps that allow businesses and customers to track rewards, store loyalty data, and redeem offers.
When people are increasingly ditching their wallets and purses for mobile device-enabled virtual wallets, a loyalty mobile app creates a convenient solution that ensures that brands can always engage customers and reward them wherever they have their phones.
The best loyalty apps can also integrate with your data analytics software to help your team develop targeted email marketing campaigns, encourage customers to engage across social media channels, and help you measure the results of the latest campaigns and specials.
Loyalty Programs
Loyalty Programs go beyond just digital storage. A digital loyalty rewards program powered by an intelligent app aims to increase customer loyalty through a range of rewards and targeted promotions.
Loyalty programs might include:
- Personlized discounts or offers
- Item, meal, or add-on suggestions based on order history
- Birthday discounts
- Digital punchcards or points for future freebies
- Delivery and payment details
It’s important to remember that loyalty programs are a huge benefit both to customers and to brands. While customers enjoy extra discounts, personal touches, and relevant offers delivered directly to them, brands have an extraordinary opportunity to keep customers engaged and coming back for more.
There are many ways to structure a loyalty program, but the most important thing to keep in mind is that customers don’t just interact with brands in one way. They visit restaurants in person, through mobile apps, on their websites, and over the phone. Loyalty programs should consider an omnichannel approach to stay consistent and engaged at every touchpoint.
WHAT ARE THE BENEFITS OF A LOYALTY APP?
The long-term success of your business depends on building relationships and creating repeat business. In fact, a whopping 65% of a brand’s business comes from existing members – so it pays to reward them.
Engaging on a personal level and keeping those members is crucial – and that means knowing their name, their preferences, and how often they frequent your restaurant or venue. To provide the best experience, brands need smart technology to keep track of customer data through digital loyalty apps and powerful loyalty software.
A loyalty app connected to your POS is the solution to customer engagement that boosts your brand. Customers can easily access loyalty rewards, redeem reward points, get early access to the latest offering, be invited into a VIP program, and ultimately feel appreciated for being part of your brand – all through one dedicated app.
Businesses also keep more powerful data from their customers’ digital engagement – something that can then be used to better tailor offers and loyalty marketing material for your future loyalty campaigns.
WHAT ARE THE MOST POPULAR FEATURES IN MOBILE LOYALTY PROGRAM APPLICATIONS?
Each loyalty program will inevitably have a different look and feel depending on the business. Your successful loyalty program needs to reflect your brand’s style and have key features that speak to your offering – so that when you engage existing customers, they’re reminded of how and why they choose to show with you.
Businesses can customize programs to suit their service, brand, and customer base. Here are the features to look out for when building a loyalty program.
Customer Loyalty Programs: Best Practices & Strategies
Set up your loyalty programs for success with the right usability, quick and relevant rewards, and other best practices.
REWARDS & POINTS
The classic, tried-and-tested customer loyalty programs are built around loyalty points. Purchases give points to loyalty program members, which they can then use to unlock rewards.
Whether free items, discounted meals, or free delivery – the rewards system may look different depending on the brand and the customer, but when you offer rewards, you increase customer retention and commitment to your brand.
ACHIEVEMENTS
Turn up the engagement by offering achievements. Customers are encouraged to purchase more from your brand when they are recognized for their loyalty. A VIP program is a powerful way of retaining customers and creating prestige in consumers.
This may mean promotion to a new title – as gold or prime members, or preferred clients – that helps raise their status. It can be a simple but satisfying way to make customers feel special and can define a successful loyalty program.
You can also create a customized rewards program where premium clients receive different treatment or offers in-store via their app, rewarding them for their long-term dedication with relevant offers.
SCAN & GET REWARDS
Adding purchase points to a loyalty account is easily managed through your brand’s integrated POS system. Customers open their loyalty app, which has an associated QR code. Staff then scan the QR code to link the purchase with their account.
Brands can structure their rewards system in whatever style suits their customers and business best. Often the purchase value will represent a certain number of points or even stars, which customers can then exchange for discounts, freebies or special offers.
PUNCHCARD
A punchcard is exactly what it sounds like! Whether physical or digital, punchcards can be a nostalgic way to demonstrate a visual achievement for customers. And it’s one of those loyalty solutions that makes shopping and rewards a bit fun.
The structure is simple – buy a certain number of something, and get one free. It taps into the customer psychology of buying into a game, with a clear and valuable reward at the end.
Digital punchcards can be combined with other rewards systems as part of a rewards program. Unlike a physical card, customers can’t lose or forget about their progress using a digital system, which helps add value to them and acts as a reminder of their brand loyalty.
MILES
One way to add extra incentive to join and utilize brand memberships is by linking your app with other industry loyalty programs. Partnerships often form between QSRs and airlines or gas stations to earn points and redeem points via an integrated app.
For example, you can earn United miles by purchasing Panera Bread e-gift cards or get 10 cents off a gallon at Shell by shopping at Dunkin’ Donuts. Airline dining programs can add another level to these partnerships, making your brand even more attractive to your frequent-flyer customer base and improving cross-brand loyalty.
REFERRALS
Research from Nielson shows that customers are four times more likely to buy a product if their friend recommends it to them. Referrals are powerful marketing tools that can boost business and help customers feel good about their purchase at the point of sale. Both parties can even gain loyalty points through a referral, giving customer loyalty a kick-start and fast-tracking more sales.
Offering incentives to existing loyal customers for referring a friend can be a win-win-win for your brand, your existing guest, and your future guest. Have it all built into a single app, and your loyalty software working behind the scenes can track patterns of influence across a community to better shape your offers long-term.
POINTS & PAYMENT
Another way for customers to receive points is by paying with a linked credit card. When customers easily opt into a program, your POS will automatically remember their card and link the purchase to their loyalty account, instantly earning them points. If you have a shopping app as part of your mobile app, then this really is a must – as it creates the easiest path to purchase for buyers.
LEVELS & ENGAGEMENT
A great example of brand levels was the 2008 Starbucks’ Gold program, offering their most loyal customers 10% off purchases for a $25 annual fee. A paid loyalty program app like Starbucks’ loyalty app meant customers could opt into their preferred level, each requiring slightly different expectations and rewards, and be rewarded accordingly.
Depending on your brand, loyalty levels can be an effective way to target a range of customers under one program and offer rewards and the VIP experience all at the same time.
SPECIAL OFFERS
Analyzing loyalty data offers businesses the chance to directly communicate and market to individual customers. Special offers could include: birthday gifts, digital rewards, giveaways, exclusive event invitations, and time-sensitive deals that encourage emotional purchases from loyalty program members.
“Special offers aren’t randomized discounts; they should directly target special events, and opportunities to capture customers at the times when your service will add the most value,” says Kerri Choromanski, Plexure’s Customer Success Manager. It’s important not just to offer the right items, but also the right timing.
Kerri explains, “Maybe that’s an offer for a blowout right before a customer’s birthday or maybe it’s a reminder about family-sized takeout meals on what you know is your customer’s busiest night of the week.”
Curating special offers is your opportunity as a brand to demonstrate your value to your customers. Building on behavioral data, you should consider purchasing trends to present the right messaging at the right time.
HOW TO START WITH LOYALTY PROGRAM MOBILE APPS?
Loyalty programs are becoming the norm among hospitality businesses worldwide, but choosing the right design is crucial. In fact, 76% of customers say they expect credible retail chains to offer loyalty programs so getting the right setup to suit your customers and your team will accelerate your returns.
An effective loyalty program needs integrated POS technology and expert advice to bring your customer experience to life. Investing in professional, world-class restaurant technology is the first step. Talk to the team at TASK to learn more about leading hospitality tech that can boost your loyalty program to the next level and help your business solidify a long-term customer base.
