Real Results for Loyalty Promotions
Using loyalty data to deploy targeted promotions gives restaurant marketers the power to drive guest visits during specific time periods, increase spending among members, and boost program enrollment. Promotions powered by Paytronix put the marketer in full control to drill down to the right audience segment and then define the offer, promotion rules, and effective time period.
This article gives a sense of the results you can expect from your loyalty promotions. It recaps the promotion metrics that Paytronix has witnessed in some of its clients’ most successful and frequently deployed promotions. From double points to instant wins and everything in between, these metrics will help you determine if your loyalty promotions could work harder to create incremental business for your restaurant chain.
Paytronix typically reports spending improvements in terms of how much the guest spends in a check, excluding the price of the reward. For example, if a check subtotal is $50 and the guest redeems a $10 reward, the amount spent, net of reward, would be $40. If the chain’s average check is $30, the increase in amount spent, net of reward, would be calculated as follows:
Think about the number of people who purchase lottery tickets. Consumers love to have a chance to win.
When our merchants run instant-win promotions, they see a spike in member spending from 6% to more than 20%. In addition to this impact on spending behavior, more members join their programs during the promotion. When guests see members winning at the POS, curiosity and the desire to win compel them to join the program. In the cases we reviewed, enrollment rates surged by at least 20%.
To add another level of excitement to its loyalty program launch, one of our clients employed an instant-win promotion during the program’s maiden month. Just about every member won something that was redeemable on a subsequent visit. Bounce-back offers like this keep the guests’ visit momentum in high gear. The instant-win promotion added so much excitement to the program that the chain is already seeing 20% of its checks come from loyal members.
Table 2 presents an example of how odds can be assigned to reward types that are available within an instant-win promotion schema.
Bolstering Promotion Results
Improve your promotions by considering these key tips:
- Plan Ahead. Add your loyalty promotions to your annual marketing calendar. Plan enough time before a promotion’s launch to test its functionality across your POS platforms and within the Paytronix tool set.
- Create Useful Guest Segments. Keep in mind the behavior you are attempting to change with the promotion and then segment your guest base accordingly. For example, segment guest data by historical frequency and then deliver unique offers to each segment. For some segments, a simple reminder will compel a visit, whereas lower-frequency guests may not change their behavior until a rich enough offer is presented to them.
- Develop Relevant Offers and Messages. Make sure the offer and message are aligned with the target member segment. For example, if your audience is primarily college students, a kid’s meal offer will not resonate.
- Schedule Messages for Optimal Delivery Timing. The time the message is delivered may impact results. Consider the time of day your message is being received by members. Make sure it’s likely to be during the time when guests are making meal decisions. For example, send lunch offers when you believe the audience is likely to be making a decision about lunch.
- Use the Most Effective Message Channel. Deliver your message using the appropriate medium. Depending on the timing and the density of content, it may be more effective to send the message via SMS, push, pull, or email. For instant-win promotions, for example, POP materials, receipt messaging, and cashier messaging are critical communication channels.
Putting Loyalty Promotions to Work for Your Restaurants
Surprise, delight, and reenergize your loyalty program with promotions. Members will respond by visiting and spending more at each visit. For a deeper dive into the details of promotions configurable within the Paytronix system, take a look at the “Loyalty Promotions That Work for Your Restaurants” LIS and our library of case studies found at http://www.paytronix.com/loyalty-improvment-series-library. Each case study provides details about the merchant’s promotional offer, timing, and results.