Restaurants today are searching for effective and innovative approaches to build a strong and dependable loyalty base. However between low consumer adoption and the financial challenges these programs can present, there is a significant opportunity to make these programs more effective. So how can you, as restaurant operators, best implement and capitalize on loyalty programs so that they move the needle for your business?

Some current challenges related to loyalty programs that operators face today include:

The old fashioned punch card: While it is an antiquated loyalty tool, many restaurant and retail locations still utilize these cards to try and incentivize customer retention. However, today’s consumer relies heavily on his or her mobile phone, and if businesses want to reach them effectively and efficiently, that is the place to do so.

Communication channel overload: Consider the connection points advertisers and marketers have to reach their audience: TV, emails and text messages. All of these mediums have grown increasingly cluttered, and few consumers are paying attention to the messages received via these avenues.

Liability of holding guest information: To add another issue to the loyalty program conundrum, businesses carry liability when holding a guest’s personal information. If there is ever a technical glitch and your customer’s loyalty points are no longer available in your system, you will not be able to reconcile in real time the loyalty benefits that customer has earned. On the other end, if you keep rewards on the books too long, your financials do not look as healthy as they might actually be.

The good news is that the ability to connect with your guests in a meaningful and productive way for both patron and business lies within existing apps on your mobile phone—more specifically, in the mobile wallet. Samsung, Android, and Apple phones all support different features in their eWallet app, and that app holds a lot of opportunity. For example, Apple Pay keeps passes inside the Apple Wallet, Google Android Pay achieves a similar result via a selection of S2AP loyalty cards on the device, and Samsung Pay will also gravitate toward similar functionality to other leading eWallet app providers.

The benefits that eWallet provides to today’s consumer include:

  • Convenience of accruing and redeeming points; building loyalty status and customization very easily and with ubiquitous user experiences
  • Adding and redeeming gift cards
  • Adding and redeeming coupons
  • Keeping track of past transactions and their locations

Consumers always have their phones on them, and the eWallet offers ease of use that emails, or punch cards simply cannot compete with.

Consider this potential scenario: As you’re looking to enjoy a night out with your family this weekend, a digital coupon notification comes into your eWallet from a restaurant where you belong to the loyalty program. The timing and convenience of this is exactly how loyalty programsshould operate. There’s no sifting through emails, and the message is delivered in real time, making the likelihood of you redeeming that coupon much greater. It is targeted, personalized and timely. Additionally, businesses can easily record the use of coupons so fraud is prevented.

For even easier engagement, digital loyalty cards—view these as the digital punch card—are a simple and speedy way to pay for your meal and redeem loyalty points or rewards at the same time. Consumers can add loyalty cards into their eWallet or easily enroll into the program via eWallet where it is supported while you tap to pay and redeem their loyalty points or rewards. For example, some tablets allow for a tap with your phone to render payment and redeem loyalty points right at the table in more than 3,000 restaurants across the United States.

Another item that consumers can have in their eWallets is gift cards. There is no longer a need to carry and sift through a cluttered physical wallet in search of a gift card, the balance of which is likely unknown. Likewise, your customers may have dined out and forgotten they even had a gift card, only to discover it after paying the bill. If gift cards were loaded directly to eWallets, they would be accessible and usable. eWallet gift cards also enable a friend or family member to purchase a gift card for someone else. So long as they have the recipient’s phone number or email address, a digital gift card of any amount can be sent directly to one’s eWallet.

Significant opportunity exists for restaurants to entice existing customers back for another visit, and to make the experience of benefit redemption convenient, seamless and personal. It all lies within the eWallet. Restaurants must close the loop between what is in consumers’ eWallets and all of the tools that fall within loyalty programs to better drive business success.

Viren Balar is the Chief Technology Officer & Co-Founder at Ziosk, and an expert in technology architecture and systems engineering with an extensive background in wireless, broadband, and digital signal processing technologies. Viren holds a Master of Science in Electrical Engineering from the University of Southern California and an MBA from Southern Methodist University.
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