The future of restaurant loyalty

Loyalty has always been important in the foodservice industry, but it has really taken a front seat in the last few years as restaurants continue to recover and competition remains fierce. Customers are getting savvy about what they are looking for from restaurants, what loyalty programs should look like, and they are voicing their concerns when their needs are not being met.

Getting to know customers is key is offering them a loyalty program that attracts members and retains customers, so restaurants need to focus on what it takes to garner that loyalty in today’s market.

The good news is, according to the 2023 Patronix Loyalty Report, loyalty remains on the rise, up 16 per cent with FSRs and 24 per cent with QSRs.

What diners want

Loyalty is achieved when customers can see that you are making an effort to get to know them, care about their needs, and are offering something that they value. For example, knowing their birthday and making them feel special can boost your bottom line and strengthen loyalty. Birthday reward redemption rates are 12 per cent, showing that this is something customers are behind. Today’s technology like AI can analyze customer behaviour and predict their needs, upping the experience and encouraging return visits.

Also, customer experience has always been paramount, but the stakes are even higher now. Customers are looking for simple, seamless digital experiences from their app to their meals. Understanding these needs and eliminating any friction points will put your restaurant ahead of the rest with an improved customer experience.

Trust is also key in a successful loyalty program. Using tactics like the bait-and-switch or moving the redemption goal posts tend to make customers frustrated and disappointed, discouraging them from returning.

Getting it wrong

Recently, some of the larger QSRs have re-vamped their loyalty programs, making it more difficult to attain rewards, and customers were not happy. Getting it wrong with your program puts you at risk for customer loss, bad reviews, and getting negative attention on social media. Not only does the word spread quickly, but there have been many TikTok accounts created that provide hacks for people to get around any adjustments or features that are unpopular.

Loyalty cheque sizes are about five per cent higher than the rest, so it’s worth the time it takes to perfect your model. But loyalty is a two-way street. Building that trust, getting to know each other, and engaging in authentic exchanges is how you grow your membership – and your margins.