Restaurant Loyalty Programs To Boost Sales in 2024

A restaurant loyalty program can be key to your restaurant marketing strategy and increase your sales. In fact, 41% of consumers say loyalty programs encourage them to buy from restaurants. Plus, loyalty programs can incentivize your customers to come back for more — this is so important to leverage since returning customers spend 67% more than new customers.   

What’s also great about loyalty programs is that they help your restaurant increase direct orders so you don’t have to rely as much on third-party delivery apps. We run thousands of loyalty programs at Owner and have studied this to make sure we help our customers drive sales. 

With that said, I'm sharing lessons from thousands of restaurants and hundreds of hours of research.   

So, what exactly is a restaurant loyalty program? In this guide, I’ll touch on what it is and how it can drive sales, the different types, software you can use and tips on how to make it as effective as possible.

What Is a Restaurant Loyalty Program?

Think of a restaurant loyalty program as a VIP pass for your repeat customers. As a restaurant owner, loyalty programs can be your superpower for keeping your regulars coming back (and spending money) by encouraging and rewarding frequent diners with things like exclusive offers and special deals. 

A restaurant loyalty program has many benefits like: 

• Earning more money: Repeat customers tend to spend more over time. Loyalty programs can increase spending as customers strive to reach even better rewards. 
• Encouraging customers to come back: Loyalty programs encourage incentives, like a point system or desirable rewards, to motivate customers to return — just like a game, people are left wanting more. 
• Learning more about your customers: Loyalty programs collect valuable info about customers, revealing their preferences, behaviors and spending patterns. As a restaurant owner, you can use this to tailor your sales strategy to your customers and get them to purchase more. 

For example, Owner helps you convert your customers away from third-party delivery apps, and a loyalty program is one of the ways you can do just that. 

Types of Loyalty Programs  

Now, you’re probably wondering what kind of loyalty programs exist and whether they would work with your restaurant. Check out the different types of loyalty programs I’ve highlighted below to help you gain some inspiration to start your own and help increase restaurant sales.

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Point-Based Loyalty Programs

Point-based loyalty programs help your customers turn regular purchases into a game with rewards — this is your secret sauce for keeping customers coming back for seconds (and thirds) and increasing your sales. With this method, customers earn a set number of points for every dollar they spend. 

Here's a quick breakdown:

1. A customer signs up for the rewards program and creates an account using their phone number or email address.  
2. The next time they purchase from your restaurant, they earn points — the more they eat, the more points they rack up.
3. Once the customer has collected a set amount of points, they can use them as rewards.
4. These rewards can be redeemed for perks like free meals, discounts or a “treat on us.” 

Tip: Stick to giving out points rather than dollar credits to give your restaurant more control over what items receive the discount. If you want to give out a free item in exchange for a certain amount of points, you can ensure that it is a low-cost purchase for your restaurant. 

Example: Ottavio’s Italian Restaurant uses this system with their own Ottavio’s Italian Restaurant Rewards program. Their customers can sign up and earn points with every order, redeem points for free food and receive exclusive discounts. They also incentivize customers to sign up by offering a chance to win $500.    

Subscription Rewards 

Imagine turning your loyal customers into elite members of an exclusive, ongoing foodie party. That's the magic of a subscription rewards program — it lets customers become members of your restaurant and sign up to receive ongoing rewards, discounts or exclusive offers, which encourages spending. 

Your customers could subscribe to enjoy perks like:

• Regular discounts, like 10% off on holidays.
• Monthly complimentary dishes. 
• To-go meal kit subscriptions. 

Tip: Make your subscription rewards scarce, like making rewards expire after a certain time. This can really incentivize your customers to use up their points or make additional purchases to achieve a certain amount of points before expiration. 

Example: Panera’s Unlimited Sip Club lets new customers subscribe and indulge in complimentary coffees, teas and various fountain drinks. They also get two months free after signing up. 

Tiered Loyalty Programs 

Tiered loyalty programs are like turning your regulars into VIPs with varying levels of exclusive perks and rewards. This program could look like this: 

• The customer signs up for the program with access to a level of tiers they can earn after a certain number of purchases (Bronze, Silver and Gold levels, for example). 
• Like a video game, each tier has different perks: Bronze might get them a free appetizer while Gold might include exclusive access to new menu items or priority reservations.
• After earning a new tier, the customer could get a badge of honor that gives them the feeling that they’re part of a club or elite.
• Throughout this journey, the customer can receive occasional restaurant promotions and freebies to keep them motivated to keep spending and boost your sales. 

Tip: Let your customers share their progress with friends. For example, if a customer unlocks a new tier level, they can share it on social media or refer a friend with a code to help organically spread the word about your business.  

Example: Chick-fil-A's loyalty program, called Chick-fil-A One, has three tier levels: Member, Silver and Red. As customers earn more points, they move up the tiers and unlock perks, like free food rewards, birthday treats and the ability to gift rewards to friends. 

Item-Based Rewards

An item-based reward in a loyalty program is like handing out little treats for specific purchases or after a certain number of purchases. It's a way to say, "Hey, thanks for choosing us – here's a little something on us." Here are some ideas of how you can approach:

• Punch card rewards: Buy a certain amount, get your next one discounted or free.
• Buy-one-get-one (BOGO): Purchase a certain item, and you get another one free. It's like doubling the joy of your order.

Tip: Pair the reward with an upsell. For example, suggest another menu item you think the customer would enjoy with their free reward at checkout. This can encourage them to spend more with you. 

Example: Subway frequently offers BOGO deals on their sandwiches, where customers can buy one sub and get another of equal or lesser value for free.

What Are Some Good Customer Loyalty Platforms? 

As a restaurant owner, boosting sales with a well-crafted loyalty program is a savvy move to keep your customers coming back for more delicious experiences. Here's a roundup of some of the best loyalty platforms to elevate your restaurant's financial success through boosted sales:

Owner.com Loyalty Program for Driving Repeat Orders 

Best for: Independent restaurant owners looking to convert their customers away from third-party delivery apps and increase sales.  Request a demo of how our loyalty program works 

Owner is an online ordering and restaurant marketing platform designed to increase online sales. The tool has automation features that help with the heavy lifting as you set up your loyalty program. We've done testing and studied the best practices of Dominoes, Starbucks, Chipotle and Sweetgreen to bring you a rewards program that can drive maximum sales for your restaurants.

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After creation, you’re assigned to restaurant success managers to ensure it looks awesome before it’s live, backed with 24/7 support. Check out how Owner helped Metro Pizza gain a 10% increase on over $10,000 in sales within the first 30 days of sales.

Toast Loyalty 

Best for: Restaurant owners looking for built-out insights into customer behavior. ‍

Toast Loyalty helps restaurant customers easily enroll, earn and redeem point-based rewards. Customers can sign up for the loyalty program with their emails at the cash register, when signing the bill and even by placing orders online at checkout. Customers can also log in to their accounts and check their loyalty progress wherever they want to — no loyalty card necessary. 

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This platform can also give you insights into your customers and their order history so you can understand exactly what they want. While Toast excels in point-of-sale capabilities, its loyalty rewards features are relatively moderate.  

Square Loyalty 

Best for: Restaurant owners looking for a program that fully integrates with their current software. 

With Square Loyalty, you can be at ease knowing that you can create recurring promotions and limited-time offers for customers to enjoy after signing up. Customers can take advantage of a customizable tier structure to earn rewards. 

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You can also track your customers’ activity through an easy-to-use dashboard to get more insights on Behavior. Square Loyalty can also connect to a wide variety of third-party apps. However, their range of loyalty rewards and offerings is not as strong as other tools.

UpMenu 

Best for: Restaurant owners who want to fully customize their rewards program.

The loyalty program with UpMenu lets you turn new customers into regulars and increase food order values. With UpMenu, customers can collect stamps and points to earn rewards, which you can also customize to fit your restaurant’s brand and goals.

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UpMenu’s program automatically distributes points and has customer service that is accessible 24/7. It can be a great tool for newer restaurants but may not be the best fit if you’re already getting a lot of sales. Luckily, you can try it out for free first.  

Tips to Simplify Loyalty Program Enrollment

Many types of loyalty programs are available to help your business, and each can serve different needs. Below are some tips to make it easy for customers to join and remind them that it’s available regularly: 

• Know your customers: A successful loyalty program should resonate with your target audience, so consider their preferences and tailor the program accordingly. You can even check out the reviews customers have left you to get a pulse for what they’re saying. 
• Promote regularly: Consider ways to effectively promote the loyalty program. Using the right restaurant marketing strategy can help ensure your loyalty program drives sales. 
• Review success stories: Research success stories of other restaurants using the loyalty program. Understanding how similar businesses have benefited can provide insights into what your restaurant can realistically gain from the program. Take a look at how Owner helped Saffron incorporate a loyalty program that helped encourage customers to order directly from the restaurant’s website. 

Boost Sales With Restaurant Loyalty Programs

Choosing the right loyalty program depends on your restaurant's unique personality, customer base and business goals. Whether you prioritize customization, engagement, storytelling or simplicity, these platforms offer diverse features to suit your needs. Elevate your restaurant's sales and customer loyalty by selecting the program that aligns perfectly with your culinary vision. 

You don’t even need to be tech-savvy to set up — that’s the beauty of third parties like Owner — try out the easy-to-use custom restaurant website builder to support your revenue goals and help your restaurant achieve success.