Recently South African chicken restaurant Nando’s have announced they are overhauling their loyalty scheme, proudly stating they have taken it to “the next level”. What this next level is and whether it will result in more loyal customers (or more restaurants in the US where they are still mostly unknown) is another issue.
Currently Nando’s use a paper based system whereby people get a stamp, with every three chilli symbols being exchanged for a reward, but with the new swipe card system every $14 results in a chicken rather than chilli. After this has been done three times people are then given a reward.
The theory is that using the swipe system will make it easier to use Big Data analytics to customize rewards based on the behavior of the customers, tailoring it to the kind of food they buy, how often and so forth.
Part of their motivation may be recent criticism of paper based card systems. There is the idea that there is a limit to the amount of information companies can get from them (especially if it is just a name or email) and this has limited marketing potential for the business.
However, another counter argument is that some customers do not necessarily want the complication of online systems. While in theory swiping a card or registering online to get the points or rewards is fairly simple it can mean awkward delays as people work out what they are owed and what they can claim from their points. It is also wrong to assume that people will want to register online as some customers can be hesitant to give their details.
Part of the problem is that most loyalty cards schemes do not tend to result in someone going to a company any more regularly than anywhere else. The best ones result in people going back to them regularly. However one criticism that recurs is that companies often look to have a reward scheme simply for the sake of having one rather than fully thinking through how their promotion can make them stand out from the competition.
What seems fairly clear is that the best schemes use the card as part of their marketing strategy. Getting hold of the email gives the company the chance to tell customers about changes in stock, upcoming events and so forth. What is interesting is it appears the reward is just one aspect of making sure a person comes back to the company and use their services on a regular basis.
It will be interesting to see if Nandos’ updated version of this kind of promotion works. Social media is linked to brand loyalty, and judging from social media posts it does seem that the people who go to Nandos tend to go there on a regular basis. Whether this will add more customers on a more regular basis will be interesting to see, both in terms of Nandos’ success and for the future of loyalty schemes in general.
Featured image courtesy of Sasha Taylor