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An Interview with Dan Kim, Founder of Red Mango

In this interview with Paytronix, Dan Kim, founder and chief concept officer of Red Mango, reveals how his Club Mango loyalty program is a key factor in the restaurant chain's unique customer-centric marketing strategy.


Red Mango Founder, Dan Kim on Loyalty and His Customer-Centric Marketing Strategy

In this interview with Paytronix, Dan Kim, founder and chief concept officer of Red Mango, reveals how his Club Mango loyalty program is a key factor in the restaurant chain's unique customer-centric marketing strategy.

Paytronix: In a QSR article and at Fall MEG, you described your marketing strategy as “customer centric.” Can you describe how you weave an idea like this into all aspects of not only your marketing strategy but in operations?

D. Kim: Dan KimAt Red Mango, our customer-centric strategy truly does touch every aspect of our organization.

When you ask most companies what their sole marketing purpose is they may give a variety of answers including things like “drive sales” and “more new store openings.” Traditional restaurant marketers may be focused on newer, faster, cheaper messages.

At Red Mango, it’s all about creating an emotional connection with our customers. We are primarily concerned with what she wants, what she thinks, and what she’s going to want. We consider her in everything from culinary selections to what her emotional expectations are of the brand. The emotional gratification she is receiving as a result of her affiliation with the brand is how we differentiate our brand from competitors. We want to make sure the role of our brand is making her feel better, happier, and healthier. Having a customer-centric focus makes all of our marketing decisions easier.

We nurture the emotional connection with our customers in several ways including product development, our interaction with them within social media, and through our loyalty program. When customers have an emotional connection to our brand, the relationship becomes stronger than any message advertising can instill. They become defenders of our brand, taking a step well beyond simply talking about the brand among their social connections.

Once that emotional connection is established – it’s really tough to break.

Paytronix: Red Mango has grown from a single location to 150 in about 4 years. How much of that growth do you attribute to your marketing strategy and why?

D. Kim: I attribute 100% of our growth to the strategy. In this business, you can win customers in one of two ways:

  1. Be everywhere with ads and new store openings. This strategy requires a significant marketing budget.
  2. Create a direct connection to the end consumer.

When we started, we didn’t have a significant marketing budget. We created a “bridge,” so-to-speak, between our brand and our customers. We had to be relevant to get and keep their attention so we relied on social networks to cut through other media clutter to get direct two-way communication with our fans. The volume of positive comments from our fans on social networks has helped build our brand. For example, when we won the Zagat award last year we partially won it due to positive word-of-mouth messages our fans created about our brand – not by spending on advertising messages.

Paytronix: You have about 150,000 opted in loyalty members today. How does your loyalty program help you execute on your “customer-centric” strategy?

D. Kim: Our customer-centric strategy created a strong interest in a loyalty program. The program has been critical in how we engage our customers. We like to give back to those who are loyal to our brand.

The consumer behavior learned with a loyalty program is 100 times more important than just an email address.

We capture everything our customer does at the store level - it’s like having a real-time purchasing GPS. It gives us customer understanding inside and out – what they buy, average check size, etc.

Understanding what they’re doing makes for better marketing decisions. Our messages are well received because they are relevant, rather than 80% ignored like typical email-only program messages.

With the loyalty program we can see if we triggered interest or an emotional connection with our messages. For example, when our customers forget to visit us, we send them a “We Miss You” message. Customers have been so touched by these messages that they share that emotional impact by Tweeting about it. Humans seek to share and have others understand their positive emotional experiences. The “We Miss You” campaign evokes either a feeling of guilt or unique ‘I’m special’ feeling that customer want to share with friends.

Paytronix: What is your future vision for your loyalty program?

D. Kim: Our loyalty program is a key part of our marketing strategy. Our objective for our loyalty/digital strategy is to retain and excite existing customers. We’ll continue to use these tools to attract and retain new customers. Customers will join because the program is easy to be a part of, provides value, and is cool.

The relationship between brand and customer has changed. In the past it was a one-dimensional relationship that depended on how much money was spent on ads. Today, consumers have so much more access to information. A 3D brand engagement approach is more effective. Consumers are constantly evaluating, discovering, and changing their minds – fluidity is how customers think today. Timely, relevant, engagement is more important than ever. Our loyalty program and digital marketing will help us gain and retain customer relationships as they continue to evaluate and discover alternatives to our brand.

Using all the latest technology our Club Mango program offers, we’ll continue to discover new ways to strengthen the emotional connection our customers feel toward our brand.

Paytronix: What is the one thing you know now about either your loyalty program or social media that you wish you knew when you opened your first Red Mango?

D. Kim: Everything. But, these things change every day. There are continuous changes in both natural consumer behavior and the technology behind the programs. From the beginning, we’ve used everything that was available to us.

What I’d like to see going forward is a consolidation of the social networks to get to more efficiency and less overlap among users. This consolidation seems to be happening now. Some sites are being acquired, while others just don’t make it.

I get a call each week from one of the new digital punch card apps. I don’t have any interest in it – I can’t see having 15 different apps running at the same time or trying to predict which one I think will survive in the long run. Plus, I don’t want all kinds of stickers on my stores saying we now accept this punch card app or that one.

I’d much rather use my loyalty provider to bring me the same benefits and more - plus an iPhone App with mobile payments and any other new technology that helps me engage my guests in a meaningful way - while delivering the data I need to make sound marketing decisions.

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Pinkberry wanted to create a promotion for its new Pinkbee’s™ low-fat milk ice cream product that would compel loyalty members to act and drive a sales and visit lift over the busy Fourth of July weekend. 

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Download this Paytronix case study and discover how Pinkberry was able to drive incremental visit and spend.