Getting the Most Out of Your Restaurant’s Loyalty Program with Technology

Though many customers may still have a few dog-eared punch cards taking up space in their wallet or hiding in the pockets of neglected coats, loyalty programs for restaurants have come a long way in recent years. Anybody can offer buy-ten-get-one deals or exchange a discount for your email address. Real innovators are setting themselves apart by building personal relationships with customers and catering their offers to unique tastes.

The latest Loyalty Report from Bond describes the landscape of loyalty programs for restaurants as more “competitive and cluttered” than ever before. From the local café to quick-service chains to Michelin-starred eateries, everyone is looking for a seat at the table and a bite of the healthy profits a successful loyalty program can bring. 

The Numbers Behind Successful Loyalty Programs for Restaurants

More restaurants and other businesses are offering loyalty programs than ever. Customers have taken notice, enrolling in record numbers andremaining engaged with numerous loyalty programs at once. 

According to Bond’s report, U.S. consumers belong to an average of 18 loyalty programs. They are typically active members of around half of those programs. Membership figures are on the rise in Canada as well. Canadians belong to an average of 15 loyalty programs, actively participating in 57% of them. 

What’s behind the surge in membership programs and enrollment? The Loyalty Report suggests that the pandemic reshaped customer expectations. Consumers everywhere are more interested in joining loyalty programs for restaurants, but they expect personalized experiences that meet their particular definition of value. The same old processes of accruing points for free appetizers won’t wow discerning diners in 2024 and beyond. 

Building Personal Relationships with Your Loyalty Program

Traditional “earn and burn” loyalty programs remain popular, but their days of prominence may be numbered. Why? Because anyone can introduce one and they’re all effectively the same. 

With around 60% of restaurants offering loyalty programs to customers, emerging players need more than one-size-fits-all deals and discounts to stand out. They need to form a bond with the customer and make them feel valued. 

Zach Goldstein, CEO of Thanx, a loyalty and engagement platform, believes competition among loyalty programs for restaurants will only increase in the coming years. “At this point, in the restaurant industry,” he predicted, “we’re on track for every restaurant having a loyalty program.” 

In such a crowded market, building long-lasting partnerships with customers takes hard work and personal attention. Just over half of Americans describe themselves as “very satisfied” with the loyalty programs they belong to. Diners are eager to engage with brands who leverage the right tools and techniques to communicate with them as individuals and offer uniquely satisfying experiences. 

The Role of Technology in Loyalty Programs for Restaurants

A host of both tried and true and emerging solutions make it simpler to launch loyalty programs for restaurants, collect insights, make data-driven decisions, and reap the benefits of stronger relationships with your customers. Here are some ways that technology is changing the landscape when it comes to loyalty programs: 

• Mobile apps: In the old days, restaurants took up real estate in loyal diners’ wallets. In 2024, customers are much more likely to show their devotion with a collection of apps on their home screen. Introducing a dedicated application helps create a seamless ordering experience and collects valuable data for personalizing customer service. It will also help you avoid losing money to third-party delivery services.

• Social Media and Email Marketing solutions: Automation tools for sharing content on social media and via email can help you manage day-to-day posting and execute specialized campaigns to reach certain types of customers. As you build a following on social media networks, you’ll gain valuable marketing resources in the form of satisfied customers who are eager to post about your restaurant.

• Customer Relationship Management (CRM) tools: Centralizing important data in a single location and providing a dashboard for communications to loyalty program members at each level of engagement, CRM platforms empower personalized services. As the acronym implies, all their features serve to drive deeper, mutually beneficial relationships with your customers. 

• Artificial Intelligence: Emerging AI-powered solutions promise to predict customer behavior, correct issues before they arise, and empower a new class of service excellence. The giants of the restaurant space are already making headlines with their bold experiments. 

“Loyalty and marketing in general are not set-it-and-forget-it tools,” said Goldstein. “You have to constantly be working at it and that generally means a great technology partner because otherwise it’s too much work.”

If you’re feeling overwhelmed by all of the options available to you, you’re not alone. Navigating all of the systems and platforms that can optimize your restaurant’s marketing efforts can be a challenge, especially while also trying to actually focus on running a restaurant. Check out Back of House’s fully vetted database of restaurant solutions to find the technology that could transform your loyalty program and keep customers coming back for more.  

Written with help from Grace Dickinson.