Loyalty programs are a cost of doing business with most restaurants. The programs provide data that helps drive business decisions, improve customer experiences and grow revenue. It’s important to understand the different loyalty programs available and when they should be used in combination with each other.
That being said, not all restaurants have the right data to use these programs effectively. We will explain what data needs to be collected within a loyalty program and how restaurant loyalty programs can help drive business decisions while improving customer experiences.
What Data Should Be Collected In A Restaurant Loyalty Program?
A restaurant loyalty program offers two main components: a rewards program and a redemption system. The rewards program allows consumers to earn points and tickets (e.g. rewards, credit, or coupons) that can be redeemed for free food, discounts, or free items. A redemption system allows consumers to redeem their points for free food.
An effective restaurant loyalty program will have the following key components:
- Consumers – The rewards program needs to attract and retain new customers with a program that is easy to use and understand. Program design needs to promote both short-term and ongoing use to encourage repeat business and to increase the number of new customers.
- Merchants – The redemption system needs to be linked to a card processing system and the marketing channels through which customers discover and redeem rewards. This way, merchants are able to track and report customer data.
- Data – The data that drive customer decisions, improve customer experiences and drive revenue.
How Restaurant Loyalty Programs Provide Data
The data that a restaurant loyalty program provides include:
- Demographics: What type of person is using the program and why?
- Profiles: What are the person’s likes and dislikes, likes and dislikes within a restaurant, or brand?
- Interactions: How often are members using the rewards program and what actions do they take? In other words, what are the customer’s preferences?
- Habits: How often do members return to the restaurant and how often do they use the rewards program?
- Habits & preferences: How do members make decisions within the restaurant? Which partner brands might members be interested in? These are just some examples of customer data that a restaurant loyalty program has to help drive business decisions while improving customer experiences.
How Restaurants Pull The Data To Make Decisions
Once a restaurant has a program in place, data needs to be collected and exchanged. This is where the merchants, loyalty program providers, technology providers, and analytics vendors come into play.
The merchants need to be participants of the loyalty program (choose the programs that work best for their brand). Once they are on board, they will have access to their own data, such as customer data. This includes their customer data and data that’s collected from customers, such as the data collected through loyalty cards and the POS.
Next, the merchants need to collect the data from customers, such as data collected at the POS. Merchants will have a choice of various technologies and vendors to help them collect data, including mobile POS software and CRM systems. Once the data is collected, it needs to be shared between the various parties involved with the program. This includes customers and merchants sharing data such as customer addresses and loyalty card numbers.
What Are The Business Decisions You Can Make With Data?
A restaurant loyalty program can help drive business decisions, improve customer experiences and grow revenue. These business decisions include:
- What products or brands should be featured in the menu
- What price point should be used
- What promotions should be offered
- What menu options should be offered
- What menu items should be served
- What service standards should be used
- How should seat layout or tables be set
- How should wait staff be trained
- How should staff schedules be designed
- How should staff schedules be managed?
What Are The Customer Experiences You Can Improve With Data?
A restaurant loyalty program can help drive customer experiences and improve experiences through data. These customer experiences include:
- How easy is it for a customer to redeem points
- How long does it take a customer to redeem points
- How often do customers return to a restaurant
- How often do customers redeem rewards
- What types of customer experiences can be improved by data
Leveraging Consumer behavior to drive business decisions and improve experiences
As mentioned earlier, the data that a restaurant loyalty program has to provide is vast. This data can be leveraged across channels, devices, and applications to drive business decisions and improve customer experiences.
- Channels: With how often customers use each channel and combinations of channels, insights on customer behavior can be gained. For example, a customer who mainly dines-in but occasionally orders delivery through the mobile app will have slightly different preferences than a customer who dines-in and out every time.
- Devices: The device used to sign-up for the program and the device used to sign-out are important metrics to track. For example, a customer who primarily uses a desktop browser to sign-up is likely to be a long-term customer while a customer who primarily uses a smartphone is less likely to return.
- Applications: The loyalty program app and the loyalty program website are key components of the program. These apps need to be designed to drive customer experiences and collect customer data to be leveraged across all channels and devices.
Loyalty programs provide a wealth of data and insights that help drive business decisions, improve customer experiences, and grow revenue. If you are new to loyalty programs, it’s important to understand what data needs to be collected, how to collect it, and how to leverage it across channels, devices, and applications.
EZ-Chow has solutions such as an Online Ordering, Self-Ordering Kiosks and Rewards/Loyalty Solutions that integrate into your existing POS systems. To learn how EZ-Chow can help you with these initiatives and more, get started by contacting us here.
Learn More about the EZ-Chow Loyalty Program
Other Loyalty articles
Ways Loyalty Programs Use Data to Drive Customer Engagement
How to Get More Customers to Enroll in Your Restaurant Loyalty Program
Restaurant Industry Loyalty Programs – Ways To Retain Customers