Unlocking the value of loyalty programs for restaurants

Restaurant loyalty programs keep customers hungry for more

As changing customer habits, economic pressures, and other factors put a squeeze on profits, restaurants have opportunities to drive more brand loyalty—and competitive advantage—by enhancing their restaurant loyalty programs.

The key to these potential enhancements involves applying strategic levers that elevate the customer experience, such as exclusive access privileges and personalized services. Our new report, based on findings from the 2022 annual Deloitte survey Evolving trends in brand loyalty and consumer behavior, details how restaurants can activate these strategic levers to gain stronger brand devotion from customers.

Restaurant loyalty programs have traditionally focused on transactional benefits intended to drive key metrics, such as visit frequency, share of wallet, and check size. These features are popular among consumers who enjoy earning and redeeming product rewards for free menu items or discounts.

However, restaurants should consider taking a targeted approach to surprise and delight guests and to make programs simpler to understand. Some brands are exploring new features, such as early or exclusive access to products (e.g., celebrity-endorsed menus), expedited or VIP services, and personalized offers. While the manifestations of strategic levers may vary by brand and evolve over time, they are fundamental to making the shift from transitional to experiential to emotional outcomes. And brands that have an emotional connection are more likely to gain stronger, lasting loyalty from customers.

How loyal are program members? Loyalty programs are an effective way for many consumer brands to encourage repeat customers. Our survey shows that almost half of restaurant loyalty members (47%) use their memberships several times a month, and almost a third (32%) do so several times a week. Most participants (67%) belong to two or more programs, which shows that while they are enthusiastic about these programs, they’re not necessarily committed to any one particular brand.

The spectrum of loyalty programs. Deloitte charts the evolution of restaurant loyalty programs in three steps, from transactional to experiential to, ultimately, emotional. Many programs focus on transactional benefits, as most customers (86%) rate this as important. Brands should make sure they are strong in this area before adding other features.

New levers of loyalty. As restaurant brands shift their programs from transactional toward experiential, they should consider new levers. At the most functional level are offers of goods, services, or price advantages. The next step may involve rewards like exclusive access, priority service, or personalization to drive an experiential outcome. At the far end of the scale, a program might aspire to elevate the customer experience by promoting personal affinities or even shared participation in a cause or mission.