Business and Operations
Cultivate less frequent guests for loyalty program impact: report
By Canadian Pizza
By Canadian Pizza
Newton, MA – Targeting low-frequency guests is the key to a restaurant loyalty program’s impact, suggests a report from Paytronix Systems, a rewards program provider.
“Target low-frequency guests. Here’s why” defines critical mass as the point where more than 15 per cent of checks can be attributed to the loyalty program. The Paytronix report explains suggests that, as a good program matures, the majority of new members come from low-frequency and infrequent guests. Restaurants have a good opportunity to increase the number of times these guests visit a brand, and this can result in more incremental visits won from competing brands, the report says.
Medium to high-frequency guests will be the first to join a brand’s loyalty program. However, by month four, the proportion of new members who have medium-to-high visit frequency drops to nearly one-sixth, with the majority of new members falling within the low and infrequent segments.
To get low-frequency guests into your program, the report suggests you focus the design on low-frequency guests. They will need to understand the value proposition quickly and be compelled to join on the spot.
To make it easy for customers to join your loyalty program, provide multiple ways to join: through mobile apps, text-to-join, mobile-friendly registration web pages, kiosks, iPads in the store, and even paper registration forms.
The report says a restaurant’s servers are the program’s best ambassadors: They must understand how it benefits them, it must be simple for them to use, and it must be easy for them to explain the benefits to guests.
“When setting goals for the organization, be aggressive and aim for at least a 15 per cent loyalty penetration rate,” said Lee Barnes, head of Paytronix Data Insights, in the release. “Getting to this level means you will need some lower-frequency members, which is also the key to producing incremental revenue.”