By Daniel Rubinstein
Chief Business Development Officer
More businesses are now realizing the importance of customer loyalty, especially in the restaurant industry. Instead of focusing only on attracting new clients, managers and owners start to give more weight to maintaining and satisfying their existing guests. This is where loyalty programs help. Customer loyalty programs offer plenty of opportunities for restaurant brands by successfully engaging an audience, driving personalized guest experiences, increasing check averages, and providing valuable insights into customers. However, when it comes to loyalty programs, restaurant professionals need to answer the following important question: does your program actually engage your clients?
The why and how of choosing the right loyalty program
Although many restaurant owners are investing their resources into customer loyalty programs, many of these solutions are not tailored to drive customer engagement and build deeper relationships with consumers, failing to bring real business results. Customer engagement is the driving force of your business. Gallup describes engagement as an emotional or psychological attachment to a brand, product, or company, and points out that in the restaurant industry, fully engaged customers will make 56% more visits per month than do clients who are actively disengaged. According to the Marketo’s findings, 63% of marketers consider engagement as customer renewals, repeat purchases, and retention.
Increasing engagement leads to a higher value for your business, including more sales. Many forward-looking global brands opt for mobile loyalty solutions. As consumers increasingly use mobile devices to search for nearby food locations, make dining decisions, and share restaurant recommendations on various social platforms, marketing campaigns should be updated and upgraded to keep up with the today’s tech savvy customers.
How Pizza Hut leverages its mobile loyalty program to engage its customers
Operating over 1,000 restaurants in 13 countries across the world, AmRest Holdings SE launched a mobile loyalty program for its casual dining restaurant chain, Pizza Hut, at the beginning of 2015. Realizing that today’s marketplace is a highly competitive environment with multiple global brands in place, Pizza Hut’s main challenge was to build true loyalty of consumers, Millennials in particular, by creating a unique digital experience.
Maintaining its focus on customer engagement, the company launched a white-labeled mobile app and a CRM-system to analyze client behavior and conduct marketing campaigns. By using a range of powerful features Pizza Hut engages its customers in the loyalty program to successfully nurture strong relationships with its customers. Here are the techniques that made their mobile app a standout:
- Outstanding UX
In today’s competitive world, just having a loyalty program is not enough. Understanding that it’s now more important than ever to stand out from the crowd, Pizza Hut makes sure that its mobile app solution is interactive, effective and differentiates from other programs. The company chose a platform solution for its mobile app and thus created an app with an exceptional mobile experience and rich visual design, based on the analysis of the behavior of 9 million end-users.
- Bonus loyalty program concept
Pizza Hut’s bonus loyalty program is tailored to build both emotional appeal and to speak to a person’s appetite, instead of simply pursuing bargains. The concept is based on collecting points. Awarded points allow customers to choose from a wide list of mouth-watering rewards, and these accumulate each time a guest dines in the restaurant or orders food delivery. As a result, Pizza Hut achieved high loyalty program penetration at a very low cost. In only two months, the Pizza Hut loyalty program app was used by every third customer. Within two years after launching the solution, penetration still remains higher than 30%.
- Viral referral program
The app has also become a key channel for new customer acquisition. The company’s loyal customers are incentivized with loyalty points to recommend Pizza Hut on social networks. By effectively leveraging word-of-mouth marketing techniques the brand successfully gains new clients. Statistics show that 10% of its users share post recommendations that result in four installs and two new guests from every recommendation.
- Effective social media mechanics
By giving their guests additional points, Pizza Hut encourages them to join its social media page and successfully drives customer engagement. Two years after the app was launched, the brand increased the number of its social media followers by 50%.
- Targeted marketing campaigns
The high level of engagement, which was driven by the described mechanics, and associated customer data allowed the company to turn it into increased visit frequency and, thus, more sales by using various effective marketing campaigns, such as automated birthday greetings, winning back lost customers, bounce back coupons, and campaigns to increase foot traffic.
Pizza Hut’s achieved results
The well-planned mobile app enabled Pizza Hut to collect an up-to-date customer database, eliminating the need to process thousands of paper forms. In two years, there were more than 12,000 validated accounts per restaurant. What’s more, over 1,000 guests use the mobile loyalty card every month per location.
Pizza Hut marketers created a survey to analyze how the visit frequency changed by dividing all app users into three main groups: (1) Heavy users (three or more visits per month), (2) Medium users (two visits per month), (3) Light users (one visit per month). The results show that the number of Heavy users is increasing, while the number of Light users is decreasing. As of April, 2017, 54% of those who took part in the survey said that they visit Pizza Hut more often, because of the app. In 2015, this number was just 51%.
Increased participation in the customer loyalty program has proved to be the main driver of outstanding results:
- The well-planned mobile app solution helped to build true loyalty by creating strong emotional relationships between the brand and its customers.
- Launching the loyalty program helped to drive customer engagement that resulted in increased visit frequency, due to the effective marketing campaigns the company implemented.
An award-winning mobile app solution
The ability to create and sustain customer engagement is critical to any brand. Restaurants especially need to nurture their consumers through engagement tactics and motivate them by providing a pleasant experience. By choosing the right mobile marketing strategy, using powerful CRM tools, and developing an effective mobile app, restaurant owners can build and maintain greater customer loyalty, win new clients, and ensure that their loyalty solution contributes to overall revenue. The amazing results that Pizza Hut achieved were honored at The Loyalty360 Customer Loyalty Awards, where its case study won the “Loyalty & Rewards Program” Award.
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