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How To Create A Loyalty Program (And The Best 10 Examples)

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Tessa ZuluagaAuthor

Have you ever found yourself choosing where to get your coffee based on where you’re closest to earning a free drink? How about where you don’t need to bring a form of payment because you have your credit card already uploaded to their app? If you’ve experienced these before you have been subject to a loyalty rewards program – and it worked.

79% of Gen Z love the idea of customer loyalty programs and 60% think all brands should offer loyalty programs. Building relationships with your customers by engaging them with an effective customer loyalty program is critical to the long-term success of your restaurant.

In this article, we’re going to discuss why loyal customers are important, how to create a strong loyalty program, and 10 great examples of restaurants that are getting it right.

Why customer loyalty is important

In order to grow their business and maintain a loyal customer base, many restaurant owners start a loyalty rewards program.

Loyal customers return to brands and spend 31% more than new customers. Marketing to new guests is important but driving repeat business is what every restaurant needs. In fact, 46% of loyal customers are likely to keep purchasing from a brand after a negative experience. Therefore, it’s important to give your existing customers perks and turn them into regular customers.

There are two main goals when creating a loyalty program for your restaurant.

  1. Get your guests to sign up

  2. Get your guests to keep using it

It’s crucial that you keep these two goals in mind as you work through your new customer loyalty program.

How a loyalty program can help

88% of consumers say it takes three or more purchases to build brand loyalty. So then ask yourself, what incentives can your restaurant offer to turn guests into repeat customers? This is where your successful customer loyalty program comes in handy.

A loyalty program can use different methods to increase repeat visitors. Some examples include:

  • Points system - Reward customers with points for every purchase. Accumulated points can be redeemed for discounts, free items, or special offers, encouraging customers to return and earn more points. Points can be used as a modern-day, digital punch card.

  • Early access - Provide exclusive access to new menu items, events, or promotions for loyalty program members. This sense of exclusivity encourages customers to stay engaged with your restaurant.

  • Giveaways - Offer exclusive discounts, free appetizers, desserts, or drinks to loyal customers. These freebies make customers feel valued and appreciated.

  • Data utilization - Gather data on customers' order history. Use this data to offer personalized rewards that cater to individual preferences, increasing the chances of them coming back for their favorite items.

  • Guest feedback - You can use your loyalty program to send your guests restaurant surveys. Understanding customer preferences helps when creating offerings and improving the dining experience.

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How to get guests to sign up

The average American consumer belongs to 16.7 customer loyalty programs. We’re telling you your guests actually like loyalty programs! All you need to do is spread the word, and here’s how:

  • Offer a sign-up incentive - A free drink or appetizer can incentivize a customer to sign up for your loyalty program.

  • Social media - Post about your new loyalty program on all your socials to get the attention of your followers. You can also include a social media promo code to track where new users are seeing your loyalty ads most.

  • Referrals - Having a referral program in place can build your loyalty program users organically. Include a referral section in your program so users can share with their friends to get a special discount or other incentive.

Build flexibility into the program

The “2022 Rewards Redemption Survey” report from The Wise Marketer and my company found that consumers value loyalty programs with a variety of options and flexibility of choice. Give your customers the freedom to choose how they get to spend their loyalty points. Always have an “unsubscribe” option just in case. Let them customize their order as much as they like. All of these factors contribute to flexibility, which they find very important.

How to get guests to stay

Once your restaurant guests have signed up for your loyalty program, it’s crucial to keep them coming back. You now have a platform to use to communicate with them. Here’s how.

Published vs unpublished benefits

All types of customer loyalty programs have published benefits. These are the perks, upgrades, and rewards customers know about, the incentives you included in your program’s description.

However, unpublished benefits are what you use to surprise your guests from time to time. Unpublished benefits can delight customers because they aren’t expecting them. When they discover these unexpected perks, it can create a positive response, enhancing their overall experience and strengthening their loyalty to the restaurant. Similarly, it’s a very competitive market, and offering unique, unpublished benefits can set a restaurant apart from others. It gives customers a reason to choose your restaurant over competitors.

Notifications

Regularly communicate with your loyalty program members. Send them updates on their points balance, special promotions, and upcoming events. You can accomplish this by utilizing email or push notifications through your mobile app to keep them engaged and informed.

Keep the perks coming

Your restaurant guests are in it for the loyalty perks. Remind them of these perks often, and customize them to meet their personal preferences. Tailor promotions based on their dining preferences, special occasions, or past ordering history. Personalized rewards make customers feel valued and more likely to continue using the program.

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10 great customer loyalty program examples

1. Sweetgreen

Sweetgreen Rewards publishes both rewards and challenges for their guests. These challenges are smart because they “challenge” guests to purchase or try new things in order to receive perks or discounts. This is a great way to test new menu items and offerings while encouraging guests to purchase them. They also offer different rewards throughout the year, and more uniquely, have outposts set up in certain corporate offices. This way, app users can have their lunch delivered right to their offices on busy days.

Creating an engaging and personalized loyalty program like Sweetgreen’s can significantly enhance customer loyalty and satisfaction.

2. 7/11 - 7Rewards

7/11 has a rewards program called 7Rewards, where guests earn points on nearly every dollar they spend. Users redeem points for free snacks and goodies and receive a free Slurpee® drink during their birthday month. Customers can also boost their savings with Bonus Points, and start a points streak when they purchase select products.

7Rewards has a fantastic UX, it’s easy to sign up for & earn points, and it has a mobile payment option. This is a stellar example of a grab-and-go rewards concept to look into.

3. Boka Black Card

At the National Restaurant Show 2023, Kevin Boehm, co-founder of Boka Restaurant Group explained how his loyalty program drives repeat visits to restaurants with an exclusive Boka Black Card. This titanium card was inspired by the movie, Up In The Air, where a frequent flyer aims to receive enough miles to earn a specific gold flying card.

The card is awarded to guests who book frequent reservations. The next time a loyal guest dines at a Boka concept, a “reservation concierge” brings the card to the table, wrapped in a beautiful box. The card includes an email and phone number that the customer can use to book a reservation from then on. Then going forward, no matter how full the restaurant is, they’ll slide the cardholders in. They never have to make another reservation at this restaurant group again. What makes this loyalty card so attractive to restaurants? Cardholders’ spending increases by 40% on average.

Loyalty programs work as long as they’re tailored to your specific target audience. This membership program provides great, exclusive benefits that are great for a higher-scale restaurant concept. For a full-service, fine dining restaurant this is a fantastic program to consider.

4. Sephora’s Beauty Insider Program

I know what you’re thinking: Sephora is not a restaurant. (Imagine what an addicting hybrid concept it would be if it was though!) However, there’s a lot of inspiration you can take from Sephora’s Beauty Insider Program. This loyalty program is tier-based with different levels based on how much a customer spends. For example, if you join the program at all you earn the first level 1, Beauty Insider. This tier is free to join and users get mild perks like free shipping. Then if users spend at least $350/year they become a VIB (Very Important Beauty Insider, VIP), where they can receive more discounts and points. Then, if they spend $1,000+ per year they receive the most reward points and special offers possible, Rouge status.

This tiered loyalty program is considered an effective marketing strategy for several reasons. The program not only offers rewards for purchases, encouraging customers to shop more often at Sephora, but the tiered structure motivates customers to spend more to unlock higher tiers and better rewards. This incentivizes increased spending at Sephora. Lastly, Sephora gathers data about customers' purchase history and preferences through the program. This data can be used to personalize further marketing efforts, sending targeted promotions and product recommendations to members. Your restaurant business can form a similar concept for its program members.

5. Chipotle Rewards

Chipotle rewards stand out as a straightforward program. Guests receive 10 points for every $1 spent in the restaurant, in the app, or online, and a free order of guacamole when they sign up. It’s also integrated into their mobile app, so customers can easily track their points, place orders, and redeem rewards through the app. Chipotle also occasionally surprises customers with bonus point days or limited-time offers. For example, in October they usually surprise their users with some type of Halloween deal if you come into a store in your costume! The unpublished perks work for Chipotle and they can work for your restaurant too.

Your small business can use Chipotle Rewards for simplicity inspiration. Make the process of earning and redeeming rewards simple and straightforward. Complicated systems or confusing rules can discourage customers from participating. User-friendly mobile apps or loyalty cards with clear instructions can enhance the customer experience, the way Chipotle does.

6. Starbucks Rewards

If you’re looking for a really good loyalty app, check out Starbucks’ app and Rewards. Starbucks has a highly functional mobile app that allows customers to pay, earn rewards, and place orders. The app also features a personalized dashboard, making it convenient for users to track their rewards progress. How their loyalty program works is customers earn “stars” for each purchase, and these stars can be redeemed for free drinks and food items. Users can also save their favorite drink orders and re-order them instantly without having to add customizations every time they order.

Most recently, Starbucks introduced tiered membership levels (Green and Gold) with added benefits such as monthly double-star days for Gold members. This is a great option for coffee shops and cafes, as your regulars who come in every day can earn more.

A well-designed mobile app enhances the user experience. Restaurants should consider investing in user-friendly apps that enable seamless ordering, payment, and loyalty tracking. Starbucks also gives users a free drink on their birthday. You can also celebrate special occasions with your customers! Offer birthday treats or anniversary rewards to make customers feel valued and appreciated.

7. CAVA Rewards

CAVA, a fast-casual Mediterranean restaurant, has “CAVA Rewards." This mobile app and loyalty program is simple yet effective. Users receive an $8 credit for every $88 they spend at the restaurant. Plus if you’re anything like us, you spend $88 almost every month (it’s delicious). CAVA also has an easy-to-use mobile app that saves your past orders and tells you about new menu items and offerings.

If you depend heavily on a lunch rush, consider checking out CAVA rewards to see how simple and easy to use this program is. And of course, don’t forget your free pita with the purchase of every bowl. 

8. PF Chang’s Rewards

If you’re looking for a points-based loyalty program with options, check out PF Chang’s Rewards. When guests sign up they automatically receive a 1,000-point enrollment bonus, which brings them halfway to their first $15 Reward. The P.F. Chang’s Rewards program consists of both a free tier – P.F. Chang’s Gold Rewards – and a paid membership tier – P.F. Chang’s Platinum Rewards.

A tiered rewards program is a great way to make your guests feel special, as well as motivate them to make more frequent purchases.

9. Pret A Manger Perks

If you’re interested in subscription-based loyalty programs make sure to check out Pret A Manger. Club Pret members enjoy up to 5 Barista-prepared drinks a day + 20% off everything through Pret Pick Up. Every. Single. Day. Guests can pause or cancel their Club Pret subscription at any time. At the bottom of this page guests can calculate how much their subscription will cost and how much money it’ll save them.

This subscription method is a great way to better staff and customer relationships and collect plenty of customer data. Your customer experience will improve as customers receive the same coffee every day while saving money. Repeat purchases like this can help keep the competition away, and increase word-of-mouth marketing.

10. Chick-fil-A

Chick-fil-A's loyalty program offers points for every purchase, which can be redeemed for free food items. They also have tiered membership levels with increasing benefits for more frequent customers. Chick-fil-A One has four membership tiers: Chick-fil-A One Member, Chick-fil-A One Silver Member, Chick-fil-A One Red Member, and Chick-fil-A One Signature Member. Guests can go up in tiers the more they frequent the restaurant.

What you can gather from this program is to keep loyalty straightforward. Customers appreciate easy-to-understand systems without complicated rules or requirements. However, consider implementing tiered levels to encourage customers to achieve higher statuses for additional benefits, fostering loyalty and repeat business.

Toast Loyalty

Delight your guests with a loyalty program that just works. Loyalty is simple to set up and even easier to use. When guests are enrolled, points are earned on every purchase using a linked credit card and can later be redeemed as a discount on future purchases in the store or online. There are even optional features to offer your patrons bonus rewards, such as sign-up bonuses and birthday rewards! Use this article to set up your Toast Loyalty Program and customize your guests' rewards, then click here to read more on how to make the most of your loyalty program.

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DISCLAIMER: This information is provided for general informational purposes only, and publication does not constitute an endorsement. Toast does not warrant the accuracy or completeness of any information, text, graphics, links, or other items contained within this content. Toast does not guarantee you will achieve any specific results if you follow any advice herein. It may be advisable for you to consult with a professional such as a lawyer, accountant, or business advisor for advice specific to your situation.