Aside from offering great food and service, how can you demonstrate care for your customers? One way is through restaurant loyalty programs. Traditional paper punch cards are a well-known form of customer loyalty but are often misplaced or forgotten. Instead, restaurant loyalty software offers a more streamlined and engaging experience for customers. This software is designed to track customer purchases and reward them upon reaching a specific number of points or goals. It can be acquired independently, although some POS software incorporates this functionality. Most software solutions can be tailored to seamlessly integrate into your current operations.
This blog discusses the importance of restaurant loyalty software in maximizing revenue from existing customers. It emphasizes the value of focusing on repeat business from loyal customers and mentions this blog will cover some of the best loyalty software options for restaurants.
What is Restaurant Loyalty software?
Loyalty management software helps restaurant businesses in creating, managing, and analyzing customer loyalty programs. It helps identify repeat or potential repeat customers and incentivizes them with rewards or discounts. Primarily used by B2C companies in restaurants, retail, e-commerce, and hospitality, it enhances customer retention, repeat sales, and customer lifetime value (CLV). If a business struggles to find its target audience, these tools can assist in narrowing down the search and testing customer retention strategies. The software can function as a standalone tool, an API, or an add-on for a marketing platform, and often integrates with email marketing or marketing automation software for easy customer identification and reward distribution. It also integrates with POS software.
Benefits of Restaurant Loyalty Programs
Implementing a customer loyalty program for your restaurant may require additional effort, but the potential benefits make it worthwhile.
1. Loyalty programs foster a dedicated customer base
A loyalty program provides an incentive for customers to return, with 69% stating that it brings them back to a restaurant. While attracting new customers is important, it is equally crucial for your restaurant to focus on customer retention and building a loyal customer base. In terms of establishing a long-term relationship between your restaurant and customers, 76% of customers consider loyalty programs to be a significant aspect of their relationship with brands.
2. Loyalty programs can increase sales
Upon enrollment in a loyalty program, 49% of consumers acknowledged an increase in their spending. Additionally, research indicates that customers who typically spend less were motivated to increase their expenditure when participating in a loyalty program. Overall, loyalty programs have the potential to influence consumer behavior positively, benefiting your restaurant.
3. Get valuable customer data
Data holds significant value, and loyalty programs offer the opportunity to collect a wide range of customer information, including ordering history, dietary preferences, age, location, and birthdays. Leveraging this data enables your restaurant to deliver a tailored experience when providing rewards. Moreover, offering birthday freebies or special deals can enhance customer satisfaction. If seeking specific customer insights, creating in-app or email surveys, with reward points as an incentive, can be beneficial. With the right data and contact details, your restaurant can implement personalized marketing strategies such as SMS notifications, email promotions, and more.
4. Loyal customers bring new customers in
Word-of-mouth marketing is highly effective for restaurants. Positive reviews and recommendations from existing customers can attract new customers. By delivering an outstanding experience and incentives for regular visits, your restaurant can stimulate customer referrals. Cultivating loyal customers can naturally lead to this form of cost-free marketing.
Top 10 Restaurant Loyalty Software
Milagro, a leader in technological innovation, offers a loyalty program that goes beyond the typical free food rewards. It provides exclusive benefits and VIP perks like free merchandise and status upgrades. Additionally, it encourages customers to share their rewards on social media, enhancing brand visibility and customer engagement.
- Customer analytics
- Personalized loyalty programs
- Integrations with POS system
- Marketing automation
- Robust rewards options
- Customizing dashboards is still a work in progress, but it’s becoming better all the time.
Toast provides a user-friendly and easy-to-set-up loyalty program, allowing patrons to conveniently swipe their credit card on a POS system, opt-in via email, and promptly commence earning points. The system operates on a point-based rewards structure, offering the flexibility to provide tailored sign-up bonuses, redemption rates, and birthday rewards.
- Customizable rewards
- Loyalty reporting
- Credit-card linked program
- Allows restaurants to offer extra rewards
- Toast’s extensive features may lead to a steeper learning curve, especially for smaller businesses, potentially hindering quick adoption.
PosIQ is a data solution designed for the restaurant industry. The loyalty software integrates with your POS to track customer spending habits and offers insights. Additionally, it includes a rewards program allowing you to provide loyalty cards to your customers. PosIQ also enables you to reward customers with tailored offers based on their previous purchasing activity, enhancing customer engagement through personalized loyalty rewards.
- Guest tracking
- Deep POS integration
- Detailed reporting
- Customized loyalty programs
- PosIQ might face challenges in scaling up for larger enterprises, impacting its suitability for growing businesses.
4. Preferred Patron
Preferred Patron is a widely used loyalty platform for restaurants, offering advanced features and customization options. It allows you to communicate with your customers and control the way they receive benefits. You can establish automated communication workflows to send to your loyalty program members when they reach specific milestones. Additionally, it provides a robust CRM to help you comprehend your customers, segment them, and track their spending habits. Preferred Patron is an excellent restaurant loyalty software tool for enhancing customer lifetime value through marketing and engagement campaigns.
- Robust rewards options
- Omni-channel marketing
- Automated loyalty notifications
- The user interface of Preferred Patron may be considered less intuitive, affecting user experience and engagement.
Movylo is a customer loyalty solution designed for restaurants, offering an automated loyalty program setup. It allows you to establish rewards programs and allocate points and rewards to customers for each order they place. The platform assists in calculating potential sales losses without loyalty members and offers a simple solution for enhancing online restaurant promotion. Movylo not only aids in customer retention but also serves as a valuable tool for customer acquisition.
- Customer list-building tool
- Customer engagement tools
- Customized loyalty promotions
- Movylo might lack certain advanced features compared to competitors, potentially limiting its effectiveness for businesses with specific needs.
Punchh has a long-standing presence in the restaurant industry. Quick-service restaurants utilize Punchh’s system for customer acquisition and to establish cohesive marketing experiences. Punchh Loyalty app provides adaptable program structures and omni-channel integrations, allowing customers to accrue loyalty points across all ordering channels. Additionally, restaurants can enhance their loyalty programs further by incorporating add-ons such as beacons, games, and surveys.
- Detailed customer reporting
- 200+ native integrations
- Omnichannel loyalty program builder
- Personalized loyalty offers
- Punchh’s integrations may be complex, and they might need extra time and resources to ensure smooth implementation.
7. Loyalty Gator
Loyalty Gator offers customizable loyalty programs for both customers and employees, along with a gift card program. The web-based software can integrate with numerous applications and allows for cardless or card-based options. It simplifies the process of creating and integrating loyalty programs into existing restaurant systems, offering customizable campaigns to enhance the customer experience.
- Loyalty programs
- Gift card programs
- Employee loyalty
- Client referral programs
- Loyalty Gator may offer fewer customization options, limiting businesses in tailoring loyalty programs to their specific requirements.
Paytronix, a major player in restaurant loyalty, solidified its position through the acquisition of Open Dining and a partnership with Zenreach. Their loyalty software helps restaurants identify valuable customers, create customized promotions, and monitor guest behaviors. Paytronix provides a comprehensive customer experience platform, offering loyalty programs for independent and multi-unit restaurants. The platform presents different loyalty programs and multiple sign-up options, enabling personalized offers and promotions based on customer preferences and spending habits.
- Personalized loyalty promotions
- Online ordering
- Guest payment solutions
- Paytronix might have a higher initial cost, making it less accessible for small businesses with limited budgets
Spoonity is a versatile digital loyalty and gift platform that goes beyond point tracking. Its analytics focus on ROI, aiding businesses in understanding customer retention and growth potential. The platform enables restaurants to run digital loyalty programs tailored to customer interests and business goals. Additionally, Spoonity provides valuable insights into business performance, allowing measurement of campaign ROI and identification of customer acquisition and retention opportunities.
- Customized digital loyalty programs
- Gift cards
- Online ordering platform
- Business intelligence and analytics
- Spoonity might have constraints in providing in-depth analytics, hindering businesses from extracting valuable insights.
10. Beam Impact
Beam Impact offers a distinctive customer loyalty program where customers can donate a portion of their purchase to a non-profit organization. This approach aligns with the modern expectation for brands to have a positive impact. The platform allows customers to support a cause and track their progress towards it with each purchase made at the restaurant. Beam Impact stands out as a customer loyalty program that emphasizes customer choice in donating to non-profits rather than collecting rewards from the restaurant.
- Choice of non-profit options
- Donation monitoring
- Beam Impact may face challenges in gaining widespread adoption, affecting its overall impact in the competitive market.
Do Restaurant Loyalty Programs Work?
Restaurant loyalty programs are highly beneficial for generating repeat business. Engaged customers tend to visit their favorite restaurant 56% more each month, and customer retention marketing is five times more cost-effective than acquiring new customers. Building a loyal customer base holds significant value, as the right loyalty program can increase revenue per customer, strengthen customer relationships, and enhance brand perception. Notably, 78% of customers are more likely to continue spending at a restaurant with a loyalty program, highlighting customer retention’s payoff in this industry.
Examples of Restaurant Loyalty Programs
The best programs typically include first-time purchase discounts, referral rewards, bonus points campaigns, and birthday coupons or gift cards. Understanding customer preferences is key, as it allows for tailored perks such as free desserts or appetizers based on points earned.
Some of the restaurant chain loyalty programs with the highest number of users. Source: CNBC
Regular customers are valuable and a loyalty program can help celebrate them. The market offers a plethora of restaurant loyalty software options, enabling you to align the software with your specific customer retention objectives and customer preferences. Beyond point tracking and reward distribution, loyalty programs can also function as a marketing tool by disseminating personalized texts and notifications to customers. The utilization of software and technology is a hallmark of a successful restaurant, and a loyalty program is a crucial component of this technological suite.