![]() It’s about five times as expensive to acquire new guests as it is to retain existing ones, according to the business consultancy ITA Group. Loyalty programs have become critical differentiators for restaurants looking to boost their retention – and the loyalty points these programs allow guests to accumulate are powerful currency. Unfortunately, this also makes programs appealing targets for fraud. The Loyalty Security Association estimates that $3.1 billion in redeemed points are fraudulent. Fraudsters may try to hack into a restaurant’s loyalty system and manipulate points or redeem them illegitimately, access personal information for monetary exploitation, or even create fake programs that mimic (and damage the reputation of) legitimate ones. As a result, it’s important to ensure your program uses layered security measures to protect the information it holds. This includes monitoring each transaction to ensure its authenticity and confirm it comes from a trustworthy source, alerting you to potential breaches, and preventing users from creating fake accounts. At each step in the guest journey, automated checks should authenticate the transaction in a way that protects the security of the system from fraudsters without impacting the seamlessness of the process for valued guests. ![]() Strengthening your emotional connection with guests Recent research has found that as critical as it is for businesses to increase their guest loyalty right now, consumer loyalty has been falling. A Salesforce survey found that the portion of consumers who feel emotionally connected to brands fell from 62 percent in 2022 to 54 percent in 2023. As technology has become a necessary part of operations for many restaurants, there has been greater potential for the brand experience to get watered down. As a result, loyalty needs some careful management. Precise, data-driven personalization is at the heart of it. In a Restaurant Dive interview, Rick Camac, executive director of industry relations at the Institute for Culinary Education, said that brands that keep the same rewards without measuring the emotional connection they make with loyalty members will ultimately lose value and customers. Chipotle, whose rewards program grew almost 14 percent to more than 36 million members in 2023, is using a “personalized decision engine” to identify the free items their rewards members can receive through Freepotle, a perk the brand launched last year to drop 10 free food items into rewards program members’ accounts over the course of the year, the report said. Providing guests with such offers not only makes their experience with the brand feel fun and special – it also helps Chipotle collect reams of additional data about the kinds of items rewards members like receiving from them. That data can, in turn, feed their plans for future menu items, specials and targeted rewards offers. Earning loyalty doesn’t have to involve offering large amounts of free food, either. Consider gamifying your program with a rotating list of contests throughout the year. What might your brand do to strengthen its emotional connection with guests? |
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June 2024
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