How Restaurant Loyalty Programs Can Improve the Customer Experience

Restaurant loyalty programs have traditionally been used to increase store traffic and customer sales by offering incentives and discounts. However, increases in technology can also make the experience of dining out a more convenient and memorable experience for the consumer.

A study released by PAR Punchh revealed that restaurant customers who ordered both online and in store visited more frequently and spent more than those who order through a single method. The company gathered millions of data points from hundreds of brands in creating data for the PAR Punchh Loyalty Trends Report.

Restaurants that offered omnichannel ordering options have been more profitable by providing a more convenient and frictionless experience. By giving customers a choice between ordering in person, online, through an app, or via a delivery service, it breaks down barriers and encourages more frequent engagement with the brand. The flexibility caters to customers in real time and leads to quantifiable results.

One of the keys to getting the most out of loyalty programs is to connect it to the company's wider tech systems, including ordering, payment, and delivery systems. This lets customer experience executives access a greater amount of data while improving the services available for their guests.

The most popular and effective customer loyalty platform is a digital app. Having an app at the customer's fingertips on their phone provides a constant reminder of brand. It can improve the ordering experience by accessing previous orders, suggesting personalized suggestions, and offering preferred payment options. It can also include personalized messaging sharing exclusive offers. Games, challenges, and social media integration are additional examples of how customer apps can increase brand identity and customer engagement.

The top loyalty programs specialize in customization and personalization. Instead of making generic offers, they deliver highly targeted, relevant promotions that speak directly to their customers in their unique brand voice. They also feature engaging challenges, offer membership tiers that unlock premium status levels, and introduce subscription models that actively retain customers.

As menu prices continue to increase, customers are drawn to incentives from their favorite restaurants, driving a 12 percent increase in loyalty sales from 2022 to 2023, according to the report. This growth far exceeds the five percent overall increase in consumer spending at restaurants.

The loyalty programs are especially popular among Gen Z customers, who comprised 25 percent of total loyalty sign-ups. This number reflects the importance of targeting digital advertising to younger consumers. This group expects seamless, personalized digital experiences and eagerly engages with brands that meet those expectations.

The study also revealed interesting consumer behavior by restaurant daypart. Customers frequent their favorite spots when they have their most leisure time – Fridays, Saturdays, and Sundays. These three days accounted for 56 percent of the weekly sales, reflecting the importance of building loyalty through weekend engagement. For the QSR segment, 56 percent of all sales come during dinnertime hours, emphasizing the demand of speed, consistency, and reliability.

The full article about how restaurant loyalty programs can drive more traffic and improve experiences can be found HERE.