Why Most Dining Loyalty Programs FailWhat others do wrong, and what you can do right.

Most restaurants have some form of a loyalty program, from punch cards or membership cards, to iPad scan systems to vouchers.

?So why don’t more customers actively use loyalty programs

Z z z

44%

Only 44% of loyalty program members are active. (Source: Colloquy)

There’s a lack of focus on increasing diner loyalty.Reason1

It costs an average of 7 times more to acquire a new customer than it does to retain a current one. (Source: Kissmetrics)

Sustainable loyalty programs focus on acquiring new diners

AND retaining current ones.

Only20% of daily deal users returned to the same restaurant to pay full price. (Rice University)

= $7

They don’t offer diners their rewards of choice.2

4 out of 5 consumers prefer a rewards program with a clearly defined proposition in which they earn points or rewards, rather than a program built solely on periodic, surprise free items.(Source: Loyalty Pulse)

Is surprise and delight effective?

And if yes, is that enough to motivate customers to dine?

Does a generic reward motivate diners, or does motivation stem from knowing they’ll receive something that they truly desire?

A trip to Hawaii, a new TV, or even a college education are rewards

specific to diners’ interests.

A reward isn’t one size fits all. Rewards of choice recognize diners as individuals.

They’re too complicated.3

With additional cards to carry, photos to take and websites to check in to, it feels like diners are constantly being asked to do extra work just to earn generic rewards.

Simplify the earning possibilities. Programs should take advantage of one consistent factor in all dining experiences:

Once they spend, automatically reward customers with their rewards of choice.

No cards to showNo coupons to printNo mobile phone to scan

The solution?

Customer spend $

They use irrelevant marketing channels – or none at all.

4Be where customers are, at all times.

Personalized and geo-targeted emails User-friendly websites without Flash or PDF downloadsA mobile-optimized and tablet-optimized websiteMobile apps to offer easy and immediate access

@

In 2012, Nielsen revealed that

But as recently as Nov 2012, studies showed that only 7% of retailer sites were tablet-optimized. (Source: Skava)

of all emails are currently opened on mobile devices.

95% 90%

7%

43%

$

andof smartphone users conduct restaurant searches

of those users choose to dine out within one day

Loyalty programs need to have a relevant presence on relevant marketing channels:

are tablet-optimizedOnly

(Source: American Express Restaurant Briefing)

It’s expected that tablet sales will surpass both desktop and notebook sales in the near future.

They don’t engage with loyalty program customers.

5 A successful loyalty programengages customers and uses their feedback to continuously improve and grow their business.

Respond to both negative and positive customer feedback

Engage customers even after their dining experience has ended with 24/7 digital resources

Post positive reviews and comments to social media for additional exposure

Create an easy-to-use platform to create dialogue with customers. Thank customers both online and offline for their loyalty.

Data shows that diners who received a response to their comments revisited that restaurant 20% more often than they had previously to the response; they also spent 16% more money at that restaurant than they did before they received the response. (Source: Rewards Network)

20%= 16% $

more visits

more spent

They don’t use data to make informed program decisions.

6

En

gage

Act Measure React

A sustainable loyalty program should use data to:

Only concrete data can measure success.

Understand who diners are so marketing dollars and efforts can target them more effectively.

Analyze data to find which customers are not dining frequently enough or spending at the desired level, and then incentivize them to change those behaviors.

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Data shows over a 22% lift in dining activity with loyalty members specifically targeted and rewarded to dine more often based on their past dining activity. (Rewards Network)

22%

The Rewards Network® Member Experience

80% 23%+of our members believe our program

is easy to understand.Our members spend an average of 23% more than non-members at program restaurants.

$$

Chooses rewards programthat interests them

91% of our members have interest in earning currency with their program

at least one debit or credit card with program

Average member registers three cards with the program.

Receivespromotional and marketing information from Rewards Network

of members regularly use our websites or emails to find restaurants.

of members actively search for restaurants on the program.

Dines at program restaurants, uses registered card to pay and automatically earns rewards of choice

Reviews dining experience and completes post-dine survey to provide restaurants with valuable feedback

Over 12 million surveys filled out to date

Reports created from customer feedback provide restaurant with necessary data to review program performance, analyze competitive benchmarks, and more

Registers

88% 91%

$

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To learn more about the Rewards Network dining loyalty program, contact Cheryl Parsons, VP National Accounts, Rewards Network at 312-291-5830, at or visitwww.rewardsnetwork.com/business-solutions

cparsons@rewardsnetwork.com