Customers will be leaving the New York City cabaret restaurant on June 22, 2023.
Brendan McDermid | Reuters
As some consumers pull back spending amid economic uncertainty, rapid casual restaurant chains are leaning towards reward programs to pull them back.
The loyalty program, which offers discounts or additional perks to bring back customers, has moved from a great bonus to a must-have for restaurants. Like cost-cost diners prioritize value, I like brands chipotle pepper, Starbucks, Hippo Others also use their rewards to continue to build habits that go beyond the occasional coupons when customers come back.
“In difficult times, loyalty programs become even more important,” said Peter Fader, a marketing professor at the University of Pennsylvania’s Wharton School. “They become the necessary elements to build and maintain relationships.”
According to Black Box Intelligence data, in the 12 months ended in May, the restaurant industry only increased its monthly traffic once in November. Sales struggle as diners visit the restaurants more frequently. Only 43% of restaurant brands tracked by Black Box reported sales growth for the same store in May.
According to data from Circana, consumers who participate in the loyalty program visit restaurants more frequently, increasing their restaurants by 22% per year. They also frequently made the brands they belong to at a rate twice as many non-members, market research firms found.
Coffee giant Starbucks 34.2 million active reward members were reported in the second quarter, saying that more than 59% of US-owned transactions came from those members. Potberry It has achieved similar success. In the first quarter of 2025, more than 42% of the total store sales came from the digital business. This includes users of the loyalty program.
chipotle pepper We have over 20 million active reward members. According to the company, it accounted for about 30% of sales on average every day, helping burrito chains avoid major price increases.
“We have really strong brand loyalty among our members,” Nicole West, Chipotle’s vice president of digital experiences, told CNBC. “We’re really focused on engaging with our members and doing it in a way that really resonates with them.”
Driving loyalty is important, such as Chipotle and Starbucks. In the first quarter, Chipotle said it recorded a decline in sales for the same store for the first time since 2020, showing a “slowdown” in consumer spending. Meanwhile, Starbucks’ same store sales fell for the fifth consecutive quarter.
Cava is curbing trends in an industry with strong sales growth, but faces Wall Street pressure to maintain rapid expansion.
Be creative
As reward programs take up steam, more brands are becoming more creative and moving beyond valued meals.
Cava improved its rewards program in October 2024, giving customers more flexibility in how they earn and use points. Members can earn points for each visit and redeem them for certain items such as PITA chips and full entrees. The program also includes limited time offers and in-app challenges. In late March, the company celebrated National Pita Day by rolling out a mascot named “Peter Chip” and offering free pita chips to its members.
“Guests love seeing moments when they can be rewarded with offerings from pita chips and other brands and want to feel joy.”
The Cava Rewards program currently has over 7 million members. According to Rebhun, a new tiered system is expected to be released soon.
Customers will order food at a Chipotle Mexico grill restaurant held in Austin, Texas on April 26, 2023.
Brandon Bell | Getty Images News | Getty Images
This year, Chipotle launched a seasonal campaign called “Summer of Extras.” The campaign gives away over $1 million on free burritos, encouraging customers to pile up visits and compete to become the state’s top Chipotle visitors.
“The revitalization of this program continues to see builds and excitement and positive responses from fans across social media,” West said. “We continue to focus on delivering value to customers through programs that allow them to be given the opportunity to “plug” points or showcase specific actions and win specific offers. ”
Salad Chain Sweet Green It also revamped its loyalty program this spring, moving away from a phased subscription program that has caused many consumers to become confused.
“In a challenging industry environment where consumers make more intentional choices per dollar, SG Rewards is designed to satisfy the moment by providing meaningful value,” said Jonathan Neman, co-founder and CEO of SweetGreen, during a conference call during the quarterly meeting in May.
Even Starbucks, the established leader of its rewards program, made changes. In June, the coffee chain ended its 25-star reusable cup bonus, replacing it with double star on the entire full purchase. The change has been controversial among loyalists who claimed that the potential for revenue has decreased, but the coffee chain said its participation is stable.
Of course, the free reward comes with trade-offs. Promotions have been reduced to profits in an industry facing tough margins at its best. The restaurant chain hopes these giveaways drive long-term loyalty and drive spending on all items.
Long-term victory
Brands navigate economic pressures think that loyalty programs help drive visits.
Potbelly improved its loyalty system in early 2024, moving to Coinbase structures that allow customers to redeem rewards faster with more items. Customers now have access to more than 14 menu items through the rewards program. This flexibility has led to more frequent visits, said David Daniels, Potbury’s chief marketing officer.
“We saw the lift almost immediately in terms of engagement,” Daniels said. “The response was very positive.”
Chicago style restaurant Portillo I participated in a loyalty game in March with Portillo’s Perks. Instead of using traditional apps, the program utilizes a digital wallet system and focuses on frequency. Track how often customers visit and award badges.
“It gives you the flexibility to change the way you deploy your program,” Garrett Kern, vice president of strategy and cooking at Portillo, told CNBC. “There’s no need for a redesign, no need to restart the application. It was a great way to get the program out in a brand-friendly way.”
The company is aiming to sign ups between 1.5 million and 1.7 million mid-summer.
– CNBC’s Amelia Lucas and Jacob Plumuk contributed to this report.
