QSR April 2023

INFLATION

DRIVING SALES WITH LOYALTY AND DATA If increasing menu item prices is unavoidable, restaurants can choose to offer a loyalty perk to offset the impact for custom ers, Goldstein says, or place at-risk menu items on a “VIP-only” menu—but it all depends on knowing who your guest is and what kinds of rewards they value most. Analyzing guest behaviors and tracking that data has become a crucial way many restaurants make decisions. Tai loring loyalty programs to individual guests’ behaviors is the next step. “Customers have come to expect hyper-personalization, so rewarding vegan guests with a free meat item or gluten-free guests with a bread-based item are mistakes brands cannot

afford to make to retain customers,” Goldstein advises. “Giving guests options in how they can redeem accrued loy alty progress allows customers to choose perks that they value the most,” he continues. “For some guests, that may be a free item or dollar-off discount. However, for customers who value their time or the feeling of exclusivity, a ‘skip the line’ pass or access to a hidden menu item rewards customers without over discounting.” Restaurant brands, as well as operators, should test all offers and incentives to make sure they’re not losing money. “You could be giving away a $5 off promotion when a $3 off works just as effectively, or perhaps a campaign does not need a dis count attached at all to drive engagement,” he says.

Additionally, integrating non-discount rewards into loyalty programs can have a significant impact. After launching a VIP hidden menu, one of Thanx’s restaurant clients experienced a 275 percent increase in customer engagement, Gold stein notes. Meanwhile, Gong cha began rolling out order ing kiosks in South Korea that allow the brand to efficiently track what products guests are order ing most, plus how often guests are coming in and their average tickets. The company also recently introduced a met ric tool called CUPS, which stands for cleanliness, will “you” come back, product quality and presen tation, and service. A QR code on receipts leads customers to a simple eight-question survey and rewards them for completing the task with a free topping on their next drink. The brand receives more than 200 CUPS cus tomer feedback datasets per month, per store in Japan, where there are 130 Gong cha stores. “Best-in-class restaurants do maybe two mys tery shops per week per store, which is eight data points,” Reynish says. “With such a dipstick anal ysis, it’s hard to drive any true trends you can act on. Whereas if you listen to customers and get that many people, you can really create macro trends and use that data to become a bigger busi ness and brand.” The brand plans to roll CUPS out to Australia, the U.K, California, Mexico, and more regions in the near future, Reynish says. But, he adds, there’s nothing worse than getting bogged down with a lot of data and not knowing what to do with it. “At their core, the value of loyalty programs is to capture and activate guest data at scale, help ing to identify your most valuable customers and what their behaviors are. If you know who these guests are and what they are most likely to order, you can take action in the face of supply chain disruptions,” Goldstein adds. q

Callie Evergreen is a Senior Editor at QSR . She can be reached at cevergreen@ wtwhmedia.com .

TECH, LIKE KIOSKS AND QR CODES ON RECEIPTS, CAN HELP BRANDS BALANCE COSTS.

GONG CHA (2), BUBBLE TEAS / ANGELA ROWLINGS

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APRIL 2023 | QSR | www.qsrmagazine.com