Five big mistakes we see with restaurant loyalty program management

These are five big mistakes we see with restaurant loyalty program management, based on in-depth program and data analysis of seventeen restaurant loyalty programs:

  1. Set it and forget it. A program is launched and put on auto-pilot.  Nobody’s steering.
  2. Count what’s easy. How many members do we have?  Instead of – How are members behaving?
  3. Assume incorrectly that all the members in your program have visited at least once.
  4. Rely on and trust averages when it comes to member visits and spending.
  5. Presume that the members who were active last year will also be active this year.

If some of these apply to you, it might be time to step back and take a fresh look at things:

  1. DON’T set it and forget it. The following guidelines will help you ensure that you’re not in ‘set it and forget it mode’.
  2. DON’T count what’s easy. Counting the number of members is a very basic starting point, but you should monitor more meaningful KPIs on a regular, periodic basis.  Overall and by store location, these should include new members added, cumulative members, members active in a period, average visits per active member and average check.
  3. DON’T assume all your members have visited at least once. Look at your enrolled/registered members to see how many have not had a visit.  That’s fertile ground for specific campaigns and offers to get these members off the sidelines and into the game.  Do this periodically as more new members come on board without a visit.
  4. DON’T rely on and trust averages when it comes to member visits and spending. I’ve seen companies look at primitive averages such as: our average member visits 5.7 times per year and spends $161.60.  The average guest simply does not exist.  Averages lie.  They disguise what’s really going on.  What’s more insightful are KPIs viewed through a segmented framework.  Segment your member base on visits in the past 12 months and include KPIs for each segment: number of members in that segment, total visits in that segment, total spending in that segment, visits per member, average check, average spend per member, and the percentage each segment represents of the total in terms of visits and spending.
  5. DON’T presume that members active last year will also be active this year. I’ve seen year to year retention rates vary widely from 30% to 60%.  The rates should be monitored using the same usage-base segments as I’ve described in #4 above, because the higher frequency members will have a higher retention rate.  This should be monitored on a rolling basis so that you don’t need to wait a full year to see if things are getting better or worse.

Loyalty programs need a periodic review and tune-up to ensure that they’re not slipping off course.  It’s a health check that involves analysis of the program and its detailed member, transaction, redemption and campaign data.  The insights will help get your program on course with a roadmap to drive better performance, increased visits and increased sales.

NEED HELP? Contact me.

Loyalty Job – Marketing Manager – American Blue Ribbon Holdings – Nashville TN

Posted June 1, 2018.

The description states that the position will be responsible for loyalty Program design and roll-out. That’s a big deal and a career-maker for the right person.

American Blue Ribbon Holdings (ABRH) operates O’Charley’s, 99 Restaurant & Pub, Bakers Square, Village Inn, and Legendary Baking (they bake the pies on other items for the rest of the family).

Job Summary

In this role, you will help our marketing efforts lead the industry while bringing our brand positioning to life. Join other passionate and dedicated marketers to continue building our brand and to fulfill our mission of providing our guests with the best dining experience.
In this important brand-marketing role, you will support our efforts to generate brand and business building ideas and deliver our annual marketing plans. Collaborating with and leading internal teams, agency partners, and our operations teams, you will continue to help bring our brand vision to life both broadly and at the individual store level.

Key Projects and Initiatives

Digital and Social Media Strategy: Develop strategy and objectives for social media / digital. Lead digital/social agency(s) on content strategy, content development, media and analytics.

Advertising Support: Participate in development of creative briefs, creative evaluation, Agency feedback and recommendations. Logistics and support for advertising, including trafficking, ad shoot specifics (food, props, etc), market level analysis

PR Planning: Development and leadership of year-long PR plan, that extends beyond Hometown Heroes to include Stars for Second Harvest, cause-marketing campaigns (Folded Flag and market specific), menu launches and other news. Leverage Media Added Value to secure additional local market media exposure.

Marketing Budget Management & Tracking: responsible for tracking all aspects of the Marketing Budget. Reconcile discrepancies. Identify opportunities for both savings and extra spends. Coordinate across full Marketing Team.

Gift Card Program Management: Manage, execute and determine growth opportunities for O’Charley’s gift card programs. Ensure strategic alignment and support across organization, leverage 3rd party opportunities, identify industry trends and new opportunities, track all initiatives, coordinate with partners (creative, Holiday, etc). Includes supervision of Marketing Analyst.

Off-Premise Initiatives: Marketing lead on Online Ordering, Delivery and Loyalty Program design and roll-out. Key member of project team working with IT to scope, design and implement new technology to facilitate growth in OLO, establishment of Delivery and eventual Loyalty Program.

Operations Reporting: Detailed marketing update each period, updates on contests, OClub membership, sweepstakes, cause-marketing campaigns and more

Project STAR (remodels & new stores) Support: Restaurant level support including POP, Hometown Hero Event, Bar Mingle Event, social media, PR etc

Local Restaurant Marketing: Development of toolkit and available to answer questions; teach MITs at OCLU. Develop, execute and track market level cause marketing programs for 10+ markets. Not responsible for planning specific LRM events.

More Information and Apply

APPLY NOW

Loyalty Domains for Sale

I have some perfect domains to be used in the loyalty program, analytic and non-profit space. Contact me if you’re interested.

loyaltypulse.com ($2,181)

loyalty-rules.com ($661)

rewardingdiners.com ($876)

sage3d.com ($1,076)

donrly.com ($1,141)

Consumer Segmentation and Behavior – Restaurant Loyalty Rewards Programs

RESTAURANT CONSUMER SEGMENTATION REGARDING LOYALTY REWARDS PROGRAMS

Restaurant Loyalty Segmentation

The Rewarding Diners consumer segmentation of restaurant diners and use of restaurant loyalty rewards programs helps restaurant companies understand dining and loyalty behavior among discrete consumer segments. The segmentation is based upon a U.S. national survey with 1,122 responses from consumers aged 25 to 65 with household incomes of $75,000 or more.

For companies planning or currently executing a restaurant loyalty rewards program, this segmentation enables several things:

  • Improved targeting by understanding those guests that represent the greatest opportunity. Loyalty programs are tie-breakers that allow companies to generate incremental visits by shifting visits within the category from a competitor to your brand. By understanding how many visits per month certain consumers have in the category, you may compare how many visits they have with your brand to understand how many additional visits may be shifted to your brand.
  • Comparison of this national-level segmentation, with breakouts by QSR, casual dining and fine dining, against an individual company’s guest composition. This is best accomplished by comparing the data in this segmentation to a similar survey conducted with your specific guests. This segmentation study provides a framework that may serve as a starting point to use when placing guests into a segment based upon their results to a survey.
  • Better understanding of the makeup and likely needs of segments to maximize relevance in marketing efforts.

The segmentation uncovers six discrete segments:

  • Power Brokers
  • Good Fellows
  • Working Values
  • On The Go
  • Casually Focused
  • Frugassional

POWER BROKERS

Restaurant Loyalty Segmentation

These consumers represent 7% of the population and 27% of the spending. They use restaurants for business and pleasure. They’re young (52% less than 35 years of age), successful (35% have a household income of $150,000) and they source meals from restaurants every day. Their average monthly restaurant visit rate is 30.8 and they use all types of restaurants, with 7.3 fine dining visits, 10.6 casual dining visits and 12.9 QSR visits. The highest percentage of their restaurant category spending is in fine dining (39%).

Restaurant Loyalty Segmentation

Power Brokers are 57% male and well educated – 78% have a bachelor’s degree or graduate degree. Among this group, 37% have paid a fee to join a restaurant loyalty program. They’re highly engaged with restaurant loyalty programs with an average participation of 12.2 programs. They’re highly motivated by loyalty programs – they estimate their visits will increase 43% as a result of an appealing restaurant loyalty rewards program.

GOOD FELLOWS

Restaurant Loyalty Segmentation

This segment is labeled ‘Good Fellows’ because 71% of the members in the segment are male. They use restaurants for business and pleasure. They represent 10% of consumers and 14% of spending. They cluster in the 35-54 age range (58% in that range) and in the lowest income bracket among the sample (45% with household incomes of $75,000 – $99,999). Their average monthly restaurant visit rate is 14.5 and they use all types of restaurants, with 2.3 fine dining visits, 4.9 casual dining visits and 7.3 QSR visits. The highest percentage of their restaurant category spending is in casual dining (39%).

Restaurant Loyalty Segmentation

Good Fellows are 71% male and well educated – 70% have a bachelor’s degree or graduate degree. Among this group, 26% have paid a fee to join a restaurant loyalty program. They’re moderately engaged with restaurant loyalty programs with an average participation rate of 5.3 programs. They’re highly motivated by loyalty programs – they estimate their visits will increase 39% as a result of an appealing restaurant loyalty rewards program.

WORKING VALUES

Restaurant Loyalty Segmentation

This segment represents 16% of consumers and 10% of spending. They use restaurants for business and pleasure. They cluster in the 35-54 age range (59% in that range) and in the lowest income bracket among the sample (46% with household incomes of $75,000 – $99,999). Their average monthly restaurant visit rate is the lowest in the ‘business and pleasure’ category at 6.7. They use all types of restaurants, but at a moderate rate with 1.1 fine dining visits, 2.4 casual dining visits and 3.3 QSR visits. The highest percentage of their restaurant category spending is in casual dining (44%).

Restaurant Loyalty Segmentation

Working Values are 56% male and well educated. 65% have a bachelor’s degree or graduate degree, but of note is the fact that this group has the highest percentage of graduate degrees in the study (25%). Among this group, only 14% have paid a fee to join a restaurant loyalty program. Their engagement level with restaurant loyalty programs is low with an average participation rate of 2.0 programs. However, they’re still motivated by loyalty programs – they estimate their visits will increase 36% as a result of an appealing restaurant loyalty rewards program.

ON THE GO

Restaurant Loyalty Segmentation

This segment represents 10% of consumers and 20% of spending. They use restaurants only for pleasure. They cluster in the 35-54 age range (53% in that range) and in the lowest income bracket among the sample (55% with household incomes of $75,000 – $99,999). They use restaurants regularly, with an average monthly visit rate of 22.3. They use fine dining about twice (2.1 times) per month, but the lion’s share of their restaurant visits are in the QSR (12.4 visits per month) and casual dining (7.8 visits per month) categories. The highest percentage of their restaurant category spending is in casual dining (48%).

Restaurant Loyalty Segmentation

On The Go are 57% female and well educated. 64% have a bachelor’s degree or graduate degree, but of note is the fact that this group has the second highest percentage of graduate degrees in the study (24%). Among this group, only 13% have paid a fee to join a restaurant loyalty program. Their engagement level with restaurant loyalty programs is moderately low with an average participation rate of 3.3 programs. They’re motivated by loyalty programs but at a rate lower than the population average – they estimate their visits will increase 30% as a result of an appealing restaurant loyalty rewards program while the overall population average is 35%.

CASUALLY FOCUSED

Restaurant Loyalty Segmentation

This segment represents 18% of consumers and 18% of spending. They use restaurants only for pleasure. They cluster in the 45+ age range (64% in that range) and in the lowest income bracket among the sample (52% with household incomes of $75,000 – $99,999). They use restaurants about once every three days, with an average monthly visit rate of 10.3. They use fine dining occasionally – about once (.9 times) per month. Most of their restaurant visits are in the QSR (5.3 visits per month) and casual dining (4.1 visits per month) categories. The highest percentage of their restaurant category spending is in casual dining (57%).

Restaurant Loyalty Segmentation

Casually Focused are 65% female and moderately well educated. 56% have a bachelor’s degree or graduate degree. Among this group, only 4% have paid a fee to join a restaurant loyalty program. Their engagement level with restaurant loyalty programs is low with an average participation rate of 1.9 programs. But, they’re motivated by loyalty programs – they estimate their visits will increase 38% as a result of an appealing restaurant loyalty rewards program.

FRUGASSIONAL

Restaurant Loyalty Segmentation

This segment represents 39% of consumers and 11% of spending. They use restaurants only for pleasure. They cluster in the 45+ age range (74% in that range) and in the lowest income bracket among the sample (56% with household incomes of $75,000 – $99,999). They use restaurants about once per week or less, with an average monthly visit rate of 3.8. They use fine dining rarely – about once every three months (.3 times per month). Their sparse restaurant visits are in the QSR (1.9 visits per month) and casual dining (1.6 visits per month) categories. The highest percentage of their restaurant category spending is in casual dining (58%).

Restaurant Loyalty Segmentation

Frugassional are 65% female and moderately well educated. 57% have a bachelor’s degree or graduate degree. Among this group, only 1% has paid a fee to join a restaurant loyalty program. Their engagement level with restaurant loyalty programs is very low with an average participation rate of just .6 programs. But, they’re motivated by loyalty programs – they estimate their visits will increase 31% as a result of an appealing restaurant loyalty rewards program as compared to 35% for the overall population.

IMPLICATIONS

Two segments – Power Brokers and On The Go – represent just 17% of consumers but 47% of spending. On the other end of the spectrum, Frugassional and Casually Focused represent 57% of consumers and just 29% of spending.

For fine dining restaurants, Power Brokers represent the greatest opportunity. They dine out daily, use fine dining restaurants on a regular basis and spend the greatest percentage of their restaurant spend with fine dining restaurants. They’re quite likely to pay a fee to join a rewards program and are highly motivated by rewards programs. Good Fellows are a secondary focus for fine dining restaurants and a primary focus for casual dining.

For casual dining restaurants and QSR, On The Go represents the greatest opportunity. They dine out more than 22 times per month and are more focused on casual and QSR than fine dining. They’re not as highly motivated by rewards programs as other segments, but they still estimate a visit rate increase of 30% as a result of a good loyalty program. Good Fellows and Casually Focused are a strong secondary focus for casual dining because of their concentration of spending in that category and their level of motivation as a result of loyalty programs.

The Working Values and Frugassional segments are not strong targets for restaurant rewards programs. They are motivated by rewards programs, but their lifestyle or life stage dictates a limited level of restaurant usage. Their conditions may change in a manner that encourages or allows more restaurant usage, but restaurant companies should be mindful that if they engage with these consumers in a loyalty program, they will demonstrate a low visit rate.

Retention of Members in a Loyalty Program

One of the important Loyalty Program metrics we look at on behalf of our clients is the customer retention rate in the program from one period to the next. One of the benefits of a loyalty program is having the ability to “see” when a customer appears to have stopped visiting your brand. It’s essential to monitor this and act quickly when things seem to be moving in the wrong direction.

With period-to-period defection intelligence in hand, the next step is to separate the controllable reasons for the apparent defection from the uncontrollable reasons. The controllable reasons are those that have to do with the customer’s recent usage and experience with your brand versus your competitors. Once you know who those customers are that appear to have defected for a controllable reason, act quickly. First, send an offer to the affected customers to attempt to reengage those customers with the brand. Second, survey those customers to gather insights that will help understand the driving force behind the defection.

This is one of the most important key performance indicators we look at with clients as part of the loyalty program “check-up” to keep programs on track and ensure that they’re affecting behavior.

Loyalogy 2018 Research Study with Customized Options for Restaurants

Loyalogy, a leading provider of loyalty program strategy, analysis and research, is planning its 2018 study of consumer behavior with restaurant loyalty programs. This will be the third comprehensive study released by Loyalogy and will include new categories of content.

Loyalogy will allow restaurant companies to become more active in the research process for this study and receive a customized research report. Participating companies may:

  • Include email addresses from members of an existing loyalty program or e-mail club to respond to the survey. This will allow comparisons of a restaurant company’s guests to the responses received from a panel.
  • Include up to 12 additional custom questions presented only to the members included from the list provided by that restaurant company.
  • Participating companies receive a custom report and a full detailed data-set of the results.
  • For more information on this custom option, contact Dennis Duffy, president of Loyalogy at dennis@loyalogy.com.

The core study will be based on 1,100 responses from research panel consumers between the ages of 25 and 65 with household incomes over $75,000. The study will include approximately 70 questions.

THE 2018 STUDY

Types of questions included in study:

Restaurant visit rate and spending, including breakdown of those who visit restaurants just for pleasure or both pleasure and business. (QSR, Fast Casual, Full-Service Casual, Full-service Fine Dining).

Usage of non-restaurant sources for prepared foods.

  • Mainstream grocery stores.  Eat in/take out/dayparts.
  • Gourmet grocery stores.  Eat in/take out/dayparts.
  • Participation in grocery loyalty programs.

Usage of delivery.  Single brand delivery versus multi-brand delivery.

Restaurant Loyalty Program Participation.

  • Participation rate in restaurant rewards programs.
  • Usage of mobile apps in the context of restaurant loyalty programs.
  • Usage of online services (website or mobile app) such as Open Table, Yelp, Urban Spoon and Trip Advisor.
  • Usage of online ordering (website or mobile app).
  • Relative appeal of different reward program benefits.
  • Attitudes about different statements regarding carrying membership cards, using a phone number as identifier and receiving promotional e-mail messages from rewards programs.
    Attitudinal statements regarding the impact of rewards programs on behavior.
  • Demographic characteristics.

Lowe’s Garden Club Select

I’ve seen the Lowe’s Garden Club Select name at Lowe’s stores and on their website. I thought it was a club; you know, like a club you join. I thought maybe it was a loyalty/rewards program, but then I figured that could not be the case because they put so much emphasis on their My Lowe’s program.

It turns out that Lowe’s Garden Club Select is not so much a club, but a method of categorizing plants sold at Lowe’s that have gone through some special evaluation and selection process.

Here is some language that appeared on the Lowe’s website:

Our team of garden experts selects and tests only the finest varieties, ensuring you always get better growth, better blooms, better longevity and the confidence to grow your best. Plants that make it to Lowe’s Garden Club Select™ originate from years of tireless evaluations and trials, with one ultimate objective in mind — to ensure you, the customer, will be successful with this product. On average, it takes between 5 to 7 years for an item to even be considered for Lowe’s Garden Club Select™.

Read more about Lowe’s Garden Club Select.

GARDENING RESOURCES

National Gardening Association – features a plant database and a wide range of forums and blog.

Dave’s Garden – a rich site for exchanging ideas and questions with other gardeners through a long list of forums.

Muddy Boots Plant Tags – the essential tool for documenting your garden. Muddy Boots Plant Tags features a robust garden record-keeping system. Gardeners can use this to document their own garden by adding plant records, pictures and journal notes in their own private database. It allows sharing information from your own personal database with others. It features interactive, QR-coded plant tags. You can scan these smart tags with a QR code reader available free for iPhone and Android smart phones as well as tablet computers. By scanning the QR-coded plant markers in your garden you can instantly retrieve the history of your plants on your smart phone. Great for garden tours large and small.

Missouri Botanical Gardens – a terrific source detailed fact sheets about many plants.

Fine Gardening – great for inspiration and articles.

American Horticultural Society – a great all around resource site for gardeners.

Good Earth Garden Center – Dirt Dollars Loyalty Program

The Good Earth Garden Center in Little Rock Arkansas gives a little bit back to its customers through its Dirt Dollars loyalty program.  It’s straightforward and easy to understand.  Get yourself a Good Earth Dirt Dollars card and you’ll earn one point per dollar spent.  Once you’ve accrued 500 points you’ll get a $25 reward.

About Good Earth Garden Center:

The Good Earth Garden Center opened for business in 1974 as primarily a retail nursery and growing facility. It has since developed into a full-service garden center offering a quality selection of shrubs, trees, annuals, perennials, roses, vegetables, bulbs, herbs, houseplants, tropicals, pottery, fountains, soil, mulch, and stone yard, complete with landscape design and installation services, irrigation installation and repair, lawn and landscape maintenance, MosquitoX misting systems and a gift shop. Basically, everything a gardening or outdoor living fan needs can be found at The Good Earth Garden Center! It’s been exciting to serve the community for over 40 years and we look forward to another great 40 years of helping you realize your landscaping dreams!

OTHER HELPFUL GARDENING RESOURCES

Muddy Boots Plant Tags is a tool that allows gardeners to label plants, make notes and organize pictures. Document your garden and track your success with this web-based tool that consolidates all of your garden information in one place. And it’s accessible with a computer, tablet or smart phone. It also offers a durable QR-coded, smart plant tag allowing you to scan a plant tag in the garden and see all of the information about your plant on your phone (plant details, notes, pictures).

The National Gardening Association is full of helpful information, forums and blogs for gardeners of all levels.

Dave’s Garden is a very popular forum website for gardeners.

Home Depot Garden Club

It’s estimated that there are about 90 million consumers in the United States who take part in gardening in some way, shape or form. It’s a hobby for some, a passion for others. Anyone can be a gardener; it just takes a willingness to give it a try and a few basic tools.

The Home Depot created its garden club some years ago to help gardeners with any skill level get started and be as successful as possible with their gardening endeavors.

There are other resources available to help gardeners keep track of their gardening projects and document the success of their gardening projects over time.  One resource of note is Muddy Boots Plant Tags.

DOCUMENTING YOUR GARDEN/TRACKING YOUR SUCCESS

Muddy Boots Plant Tags is a garden record-keeping system which allows gardeners to add plant information to their personal database along with pictures and journal notes.  It’s a new platform for gardeners to do what they’ve always done: label plants, make notes and organize pictures.  But it enables all of that with a web-based tool that makes all of your garden information available with a computer, smart phone or tablet.  You can take all of the gardening information with you out to the garden in your pocket.

Muddy Boots Plant Tags also features optional QR-coded, interactive plant tags.  The dilemma gardeners have faced for years is that traditional plant tags (some refer to them as plant labels or plant markers) wear down over time, get lost or just cannot be read anymore.  Muddy Boots Plant Tags are aluminium and etched with a QR code that can be scanned with any smart phone or tablet using one of many free QR code reader apps.  This allows you to scan a tag in the garden and read all of the information you have in your personal database on your phone, instead of crawling around on the ground looking for a legible tag.

FEATURES OF HOME DEPOT GARDEN CLUB

The Home Depot Garden Club features loads of helpful information for gardeners.  Some is how-to and some inspirational.  It also features a searchable plant database to help you figure out what to plant where and how to care for your plants.

 

Muddy Boots Plant Tags – a New Tech Tool to Help Gardeners Document their Garden

Over the past decade, Nancy Duffy has built a lovely ornamental garden but has been frustrated for years with her plant tags. “With thousands of plants in my garden it’s hard to remember all the names,” said Nancy. “I walk the garden with my gardening friends and crawl around the ground looking for a tag, which may or may not be there and if it is, it may not be legible anymore.”

A professional garden designer and avid gardener, Nancy came up with a solution. Muddy Boots Plant Tags are durable plant tags that can be scanned by a smart phone, retrieving information about the plant that the gardener has input into the Muddy Boots Garden Record-Keeping Application. “Instead of crawling around to find the tag and reading the tag, often at ground level, you scan the tag and read information about your plant on your phone,” said Nancy.

The Muddy Boots Garden Record-Keeping Application allows gardeners to organize all the information about their garden in one place, accessible from a computer, smartphone or tablet. “Gardeners can keep much better records about their plants including journal notes and pictures. No more tattered notebooks and file folders,” said Nancy. “And the gardener can access the data from the house or out in the garden. The interactive, scannable plant tags can be scanned by the gardener or visitors with a simple QR code scanner on a smartphone or tablet.”

Mignon Durham is an avid gardener using Muddy Boots Plant Tags in Asheville, NC and she says, “I am a detail geek, with a bent to documentation, photography, and maintaining folders of plant tags and sales receipts. Muddy Boots Plant Tags is the perfect solution. Muddy Boots Plant Tags now has all my plant and garden history (three years of information now available on my iPad, iPhone, or laptop). Furthermore, any plants with a QR coded plant tag can be scanned on a smartphone while out in the garden for access to its entire record.”
Bullington Gardens, a 12-acre horticultural education center and public garden in Henderson County NC, has recently selected Muddy Boots Plant Tags. “We are excited to implement Muddy Boots Plant Tags. The Record-Keeping Application will allow us to better organize information about our remarkable plant collection and the plant tags will make that information accessible to our many visitors,” said John Murphy, Director of Bullington Gardens.

Muddy Boots Plant Tags are made of aluminum and feature a unique QR code that links it to the plant data in the Garden Record-Keeping Application. The tags are durable and made to hold up for years in the elements. These plant tags are available in bundles of five at the website. A purchase of plant tags is not required when using the Garden Record-Keeping Application; however, the plant tags are necessary for scanning plants while out in the garden.

The Muddy Boots Garden Record-Keeping Application is free for gardeners with up to 25 plants and 50 photos. Gardeners with more plants and photos may purchase a subscription for $4.95 per month, or $49.95 per year allowing up to 500 plant records and 5,000 photos. There are higher level plans for larger gardens described at the website. All levels include unlimited plant and garden journal notes and are “Ad Free” – no ads whatsoever appear in the Garden Record-Keeping Application.