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Why a QSR Loyalty Program is Crucial to Your Customers’ Bottom Line

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There are nearly 200,000 quick service restaurant (QSR) franchise establishments in the United States, and that number is growing steadily each year. For your QSR customers, that means the competition is hot and the need to run a cohesive, streamlined business is higher than ever.

The success of a QSR business relies on many factors: location, high-quality product, marketing, and of course, the bottom line. Did you know that by offering a loyalty program, you can help your customers do all the above and more? Read on to discover six ways a QSR loyalty program can help your customers succeed.

Benefit #1: Less Price Comparison

Most of the time when consumers are deciding on a product, price is a top consideration. What is your QSR customer to do if they aren’t necessarily the lowest priced option in their market?

The answer can lie in a QSR loyalty program. If your customer successfully implements a loyalty program that their patrons love, your customer’s restaurant is more likely to stand out in the patron’s mind. This loyalty means those diners may not simply choose the cheapest meal option – if your customer successfully creates a rewarding, personalized experience, their patrons will likely choose the restaurant that gives them perks and customized attention, not just the lowest price tag.

And your customers can add special value, even if at first glance they do not appear to be the lowest priced meal provider. According to The Association for Consumer Research:

“The excitement that is often generated in consumers by a price promotion suggests that there is an ego-expressive, as well as utilitarian aspect to a price. This ego-expressive aspect results in ‘smartshopper feelings.’ It is proposed that these feelings can be enhanced by leading the consumer to feel responsible for the discount and by dangling the discount in front of consumers.”

In other words, by offering a promotion via its loyalty program, a QSR’s customers are more likely to feel like smart shoppers. This is even more true when they feel responsible for finding the discount (i.e. when they find a discount in their personalized loyalty program) and when the promotion is “dangled” in front of them (also through the loyalty program). That rewarding feeling may just be enough to entice them to eat at your customer’s restaurant instead of another establishment that doesn’t offer any special mood-boosting promotions.

Benefit #2: Stronger Customer Retention

Loyalty programs are designed to, well, create loyalty. With so much competition in the QSR market, it’s critical to retain the diners that your QSR customer has already attracted. It’s also worth noting that:

  • 25% to 40% of total revenue from the most stable businesses comes from repeat business
  • Loyal customers spend 67% more than new customers
  • Customer retention costs 4-30 times less than customer acquisition
  • A mere 5% lift in retention can increase profits by a whopping 85%

A QSR loyalty program can help your customers enjoy all of these perks by retaining existing customers and turning them into loyal ones.

Did you know your QSR customers can promote their loyalty program on their receipts with PromoPRNT, Star’s value-added promotional tool?

Benefit #3: Higher Customer Lifetime Value

A QSR loyalty program can also help raise a restaurant’s Customer Lifetime Value (CLV or CLTV). What’s that? Simply put, it is “a prediction of the net profit attributed to the entire future relationship with a customer.”

By leveraging loyalty program analytics, your restaurant customer will be able to calculate each of their patron’s CLVs. Knowledge is power, and understanding this data can help the restaurants strategize how best to cater to these patrons and keep them loyal.

It has been shown that:

  • Loyalty programs increase overall revenue by 5-10%
  • On average, loyalty members spend 5-20% more than non-members
  • Loyalty program members buy 5-20% more frequently than non-members

Clearly a QSR loyalty program is a win-win: it provides benefits to the consumer and greatly affects the restaurant’s bottom line.

Benefit #4: A Personalized Experience

Personalization is everything. We’re living in an era where virtually everything is personalized – with self-service kiosks you can order your food your way and you can even have your favorite household supplies delivered directly to your door on whatever schedule you’d like. A QSR loyalty program should play into this era of personalization.

A complete, successfully implemented loyalty program will make your QSR’s customers feel emotionally connected to the restaurant. Not only will these positive emotions bring diners back again and again, but they are more likely to be forgiving if a hiccup like a mistake in order-taking occurs during one of their visits.

Some ways a loyalty program can create these personalized feelings is by calling customers by their name within the user interface, remembering a customer’s favorite customized orders, offering rewards for special events like the customer’s birthday, and more.

Benefit #5: Create Influencers

According to marketing legend Philip Kotler, “the best advertising is done by satisfied customers,” and isn’t that the truth?

Did you know that an estimated 20-50% of all purchasing decisions are primarily influenced by word-of-mouth? And nearly three-quarters of millennials feel it’s their responsibility to help their loved ones make smart purchasing decisions. In other words, when consumers have a positive opinion of your brand, it’s sure to go places in terms of growing your QSR customer’s business.

How does a QSR loyalty program fit into this? If the program offers special deals and great perks, patrons are likely to share that information with their friends and family. A smart loyalty program will also include a refer-a-friend feature (which is another great place to incorporate a special discount like “refer a friend and get $5 off your next order”).

Benefit #6: Attract New Customers

To grow as a business, your QSR customer needs to not only be keeping its current customers happy, but also be attracting new customers. A well-thought-out QSR loyalty program can help do just that. Here’s how:

  • An immediate discount or promotion just for signing up with the program can entice people to try the restaurant (and the loyalty program).
  • If a customer is aware that the loyalty program offers good, easy-to-obtain deals and discounts, they are more likely to try a restaurant for the first time.
  • When choosing a place to eat, roughly 60% of consumers say they use their mobile device to help them decide. If a loyalty program (and its immediate discounts) are easily found by the consumer in search results or on social media, they are more likely to try the restaurant and get that deal.

Examples of Successful Loyalty Programs

So, what does a good QSR loyalty program look like? Luckily three major brands have built success programs you gain can inspiration from:

Starbucks
Starbucks Rewards Program
Source: starbucks.com

The Starbucks Rewards program is an iconic loyalty program. Featuring order ahead, pay-by-phone, free birthday treats, “Double-Star Days,” personalized exclusive offers, and more, Starbucks is doing a lot of things right. And according to Zinrelo, Starbucks has reported an increased revenue of $2.65 billion, attributing the program for most of that increase. Click here to learn more about the Starbucks Rewards program.

Panera Bread
MyPanera Program
Source: panerabread.com

Panera Bread’s loyalty program, MyPanera, is another one worthy of drawing some inspiration from. It offers a sign-up reward, exclusive sneak peaks, information on local events, order personalization and easy reordering, and the opportunity to subscribe to a MyPanera+ Coffee program which provides unlimited coffee for just $8.99 per month. Click here to learn more about the MyPanera program.

Chick-fil-A
Chick-fil-A One Program
Source: chick-fil-a.com

Chick-fil-A One, the popular chicken QSR chain’s loyalty program, is a tiered program that allows customers to earn points on every purchase. The program includes things like the ability to use points for catering orders, surprise rewards for a customer’s local Chick-fil-A restaurant, birthday rewards, new menu items and insider content, and more. Click here to learn more about Chick-fil-A One.

Looking to offer even more to your QSR customers? Discover all of Star’s products for restaurants in our Restaurant Brochure.

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