Successful programs give brand advocates a simple way to refer your brand to friends, family, and colleagues. Some programs are also used to bolster relations throughout local communities, as well as for trade programs, employee dining, and guest recovery. Overall, gift card programs are beneficial for top-line revenue, but at the same time, they can become a drain on accounting resources and add friction to franchisee relationships.
See if you can relate to any of the gift program horror stories below. And check out the tips offered to steer clear of them.
Not Enough Channels - Gift card sales can be a financial boon for a restaurant. Extending the presence of the brand beyond your locations gives your guests the opportunity to share their passion for it. Selling gift cards in store, enabling orders online, and offering virtual gift cards are all important aspects.
A recent study by American Express and Technomic revealed where restaurant gift cards are typically purchased – and your restaurant locations are just the beginning. Of the study’s participants, 27 percent reported purchasing restaurant gift cards in grocery stores, while 20 percent reported purchasing from mass merchandisers.
When gift cards are made available through third-party retail channels, material sales growth takes place. Offering gift cards through more sales channels will help sales grow exponentially.
With a greater understanding of customer spending and visit habits, marketing becomes more agile, is able to make informed decisions, and can ultimately compel repeat visits and increase baskets through relevant engagement.
There are three main factors that make a loyalty program successful:
1. A well-designed program. Core loyalty programs typically motivate members to increase visits and spend. Customers need to feel the value of being a member. They should be earning a reward around every 4 to 6 visits. It is best to make sure you have low-value redemption options such as a cup of coffee or a candy bar that customers can work towards redeeming and feel as though they are being rewarded fairly.
Running various kinds of promotions is another key component in a well-designed program. Promotions keep the program interesting and fresh in the eyes of the customer. Getting a surprise reward makes customers excited and more willing to engage in the program. […]
Promotions are used to directly, quickly, and profitably change behavior. Most commonly, that behavior change falls into one of these categories: driving more visits, encouraging people to purchase at a time they normally would not, or inspiring more profitable bulk purchases.
The most common types of promotions are challenges, bonuses, and occasion based rewards.
Challenges. These promotions challenge reward members to perform actions to earn a prize. For example, a challenge could be “buy gas five times this month and get a free large coffee” or “spend $50 on snack items this week and get a free liter of soda.” These challenges are intended to increase visits and spend during a specified period of time.
Bonuses. These promotions often offer an instant benefit for the rewards member. “Purchase a sandwich and a large soda and get a bag of chips for free” is one example. Bonuses are primarily designed to increase spending during a visit, but secondly, they may also increase the number of visits since customers could seek to take advantage of a bonus multiple times.
Occasion-based rewards. These promotions are dependent on a time of year, such as the holiday season, or a well-known event. An example of an occasion-based reward could be “purchase two bags of chips and get a liter of soda for free during the week leading up to the Big Game.” […]
Recently we spoke with Anne Schultheis, Digital Marketing Manager for Kahala Brands, who submitted an award-winning Pinkberry campaign that was recognized in May by Paytronix with a 2017 Loyaltees Award. The Best Early Adopter award celebrates brands that leverage a new Paytronix feature to benefit their business in 2016. Leveraging Paytronix’s new Target and Control feature, Pinkberry could measure both the ROI and the overall performance of the double-points promotion for a new product trial—Pinkbee’s™ low-fat milk ice cream.
Anne shared some additional insight on how Kahala Brands has leveraged Paytronix for marketing campaigns, and how the loyalty platform is making an impact upon Pinkberry guest engagement. By using the new Paytronix Target and Control feature, the Pinkberry marketing team was able to measure the effectiveness of two different email headlines, then dive even deeper to determine which headline actually motivated loyalty members to visit its stores.
Paytronix: When did you first start working with Paytronix?
Anne: Pinkberry has been working with Paytronix since 2012. When Kahala Brands acquired Pinkberry in 2015, we were excited to start using more features that Paytronix offers, such as target & control, surveys, segmenting, etc.
Paytronix: Have you run any other promotions since the successful July 4 campaign? […]