QSR Loyalty Programs Can’t Afford to Stay Insignificant

As the economy slowly makes its way out of the recession, quick-service restaurants will see changes in consumer spending habits. As the economy improves, consumer frugality can diminish, and a QSR may not be their next stop.

Last week in GuestIQ, an article about Harrah’s Resort’s guest loyalty program showed it is a great success, but not all loyalty programs have proven as fruitful. The QSR industry is one that can use improvement, especially to retain guests in the wake of new spending trends.

A QSR Magazine article from late September 2009 revealed that QSR loyalty programs have one of the lowest participation rates:

  • Only 17% of participants reported high satisfaction levels.
  • Only 6% of more than 2,400 respondents participated in QSR rewards programs.
  • Only 11% of participants found the programs “very” influential when making decisions on where to dine.

Low participation has been attributed to the limited availability and “newness” of such programs. Participant feedback shows the following as the most preferred rewards:

  • Free merchandise or upgrades.
  • Discounts at the POS.
  • Coupons or discounts on total purchase.

As reported by Reuters on October 13th, clothing retailer American Eagle Outfitters announced in a press release that aerie, their intimate apparel line, has surpassed one million members in its a-list rewards program in a little over one year. The program “steadily” increased loyalty by offering free gifts (e.g. jewelry, lip gloss, journals, etc.), promotions with purchase requirements, and 20% off offers just for being a member. Christiane Pendarvis, chief merchandising officer for aerie, states their customers have a “strong emotional connection to the brand, and the a-list program helps strengthen that bond.”

Read the Reuters Article here.

Read the QSR Magazine article here.

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