Brief:
- TGI Fridays UK, the casual dining chain with 80 outlets, saw boosts in multiple key performance indicators just a month after rolling out a new mobile app, according to news released today. Loyalty visits rose 61% and loyalty revenue increased by 66% as the app offered loyalty "stripes," or points that diners could collect to unlock different rewards.
- The points system replaced an earlier version of the app that had a "Scratch, Match and Win" feature that would randomly offer rewards to customers. The new app helped to increase signups by 30%, unique guest visits by 51% and referrals with a verified visit of 300% in its first month, per the statement.
- TGI Fridays worked with Punchh, a developer of white-label apps for restaurants and retailers, to create the loyalty app.
Insight:
The early success of TGI Fridays UK's new mobile app demonstrates the power of gamification to increase an app's stickiness and drive repeat sales. However, Fridays and other restaurants and retailers should be aware of customer preferences with regards to loyalty apps, especially when seeking out digital native Gen Zers, 40% of whom say loyalty programs require too many purchases to earn rewards or to redeem points.
TGI Fridays is refreshing its brand in the U.K. after hiring Steve Flanagan, the former marketing director of Starbucks EMEA, as chief marketing officer. Starbucks has been an early pioneer in the adoption of mobile technologies to drive store visits, contactless payments and in-app ordering for pickup. Flanagan has led an overhaul of TGI Fridays' digital offerings and updated in-store experience that includes the addition of a vegan menu to supplement its usual American fare.
Smartphones have given restaurants a platform for improved loyalty programs that plastic membership cards and key fobs can't provide. Mobile optimization is essential in keeping customers engaged with a loyalty program that works seamlessly with an app, according to researcher Gartner L2. Integrating loyalty programs into branded apps also opens the possibility of linking rewards to mobile wallets. Brands are recognizing the need to diversify rewards with more than simple financial benefits like discounts, with 61% of brands this year offering experiential rewards and monetary benefits, compared with 47% in 2017, according to the Gartner L2 survey. Experiential rewards can include birthday perks, invitations to exclusive events, free service and early access to products and sales.
Punchh works with brick-and-mortar retailers and restaurants on mobile programs to drive store visits. Blaze Pizza, a growing U.S. chain that counts NBA star Lebron James as an original investor, partnered with Punchh this month on a new mobile app that offers a loyalty program and messaging to pre-existing customers to boost orders, per Fast Casual. Chick-Fil-A and Wayback Burgers also have introduced tiered rewards systems on their mobile apps in the past month, per Restaurant Business.
