3 Well-Known Companies that Reinvented Themselves with Customer Loyalty Programs
How did these global giants gain a massive number of customers?
The F&B industry is, unfortunately, a tough industry to survive in. Competition and tight margins mean that if a business is unable to continuously make repeat sales, it is likely to tank. Selling in high quantity is the key to truly being successful, and to do this, it's imperative to get customers invested in your business. One of the most effective tactics that large companies are using to gain repeat business is customer loyalty programs.
Though they've been around since the 1900s, customer loyalty programs, these days, are far more sophisticated. Using a combination of "user-level data storage, dynamic personalization and big data analytics," businesses are equipped with the tools to better anticipate hot trends and customize their approach and uniquely interact with customers. At the end of the day, loyalty programs are a way of creating meaningful engagement between a business and the customers, and it is this engagement that keeps them coming back hungry for more.
Below are 5 examples of how large companies completely changed the game with their customer loyalty programs.
Starbucks' rewards program has undoubtedly reinvented how the company interacts with its customers. By creating their "My Starbucks Rewards Loyalty Program" back in 2010, they were quickly able to increase "both transaction frequency and average ticket size." Their rewards program owes its success to two important features. Firstly, using a tiered system, meaning that customers were encouraged to spend more to ascend into higher membership levels and receive better rewards. The premium Gold Tier, for example, allowed customers to own a customized card while also giving them Double-Star Days, which boosted the points (stars) on their cards. Starbucks also created an app that not only simplified mobile payments, but created incentive for customers to try multiple products, which helped breathe life into items that may have been underperforming. A combination of incentivizing customers, creating engagement and boosting convenience has ensured that Starbucks' reward program -in conjunction with their app- has been a resounding success.
In terms of figures, Starbucks processed more than  42 million payments through their mobile sales app only a year and a half after it launched, in 2011.  As of 2016, the Starbucks app and loyalty cards store 1.2 billion USD, which is more than what some global banks own! Talk about a successful loyalty program!
Domino's was once a company that was seen as old and stagnating with a stock price of  $8.76 per share in 2010. However, it now has a staggering stock price of $243.6 per share as of January 7th, 2019. How exactly did Domino's reinvent itself? Well, most pundits are in agreement that after CEO, Patrick Doyle took over in 2010, the company's fortunes reversed course because of a steadfast focus on digitization and loyalty.
Doyle's main focus was to turn Domino's from a simple pizza company into an  "e-commerce company that happens to sell pizza." A large part of their success was in creating the "Piece of the Pie" loyalty program. The program offered customers a free medium, 2-topping pizza after accumulating 60 points. Orders over $10 automatically accredited 10 points into a customer's Domino's account. This tactic encouraged upselling as customers who had orders under $10 felt as if they would miss out on a free pizza down the line if they didn't spend enough in the present. Domino's further ensured that it would be as easy as possible for customers to join the loyalty program by requiring customers to only create a single account to do everything from online pizza ordering to collecting points. Paired with an aggressive social media campaign, Domino's had reinvented what the modern pizza company was capable of and earned a legion of loyal patrons.
Panera, a restaurant and bakery chain based in the US, decided to revamp its loyalty program in 2012 so that they could accrue more business from customers. The loyalty program, named "MyPanera", takes a personal approach, letting customers "customize their menu based on their personal tastes," while also letting them accumulate points that can be redeemed for free items. This new loyalty program has effectively digitized a lot of customer transactions and provided a vast pool of data that Panera has been able to access to make sure their service is tailored specifically for customers. To date, the Panera loyalty encompasses around  25 million members and this number is only climbing.
Panera ensures that members continue to feel rewarded and encouraged by granting them access to exclusive events, secret product launches and more. This exclusivity ensures that members have a vested interest with Panera, and negates stagnation. Effectively, Panera's loyalty program is helping to ensure that this behemoth of a company continues to gain repeat business while engaging with their customers. To get an idea of this loyalty program's success, "all told, the company's digital sales channels and integrated loyalty program now account for 26% of total company sales." Those are some seriously impressive numbers.
To find out more about how Eats365 can help your business build up, digitise or revamp its loyalty program, simply inquire here.