First-ever loyalty programs from Popeyes and McDonald’s come amid a rise in consumer engagement with such offerings in the QSR space.
On Thursday, McDonald’s will expand a test of MyMcDonald’s Rewards nationwide following trials in Western and New England states.
Last month, Popeyes debuted Popeyes Rewards, the chain’s first loyalty program.
When it goes live this week, MyMcDonald’s Rewards will be available exclusively via the McDonald’s app. Diners will earn 100 points for every one dollar spent on qualifying purchases.
The program consists of three points tiers, the first of which—1,500—is achieved with a diner’s first purchase using the rewards program. Reward options in that tier are free hash browns, a vanilla ice cream cone, cheeseburger or McChicken sandwich.
In the test markets, MyMcDonald’s Rewards members were “far more likely to return in the next 30 days compared to non-loyalty customers,” McDonald’s USA president Joe Erlinger told financial analysts on a Q1 earnings call in April.
One of the hoped-for incremental benefits of MyMcDonald’s Rewards is an increase in personalized offers and being able to identify diners.
“Customers love the personalized experience of being treated by their first name,” Erlinger explained.
Popeyes rolled out Popeyes Rewards on June 17. It’s available not only via the chain’s app but also for online orders at popeyes.com.
“We're excited to use this connection with our guests to drive incrementality to targeted offers and campaigns,” José Cil, CEO of Popeyes parent Restaurant Brands International, told investors in April.
Last month, Chipotle Mexican Grill upped its Rewards Exchange program by expanding the options for cashing in points beyond food to include beverages and apparel.
To highlight the speed with which Rewards Exchange members can earn and cash in points—for example, free chips after just two visits—Chipotle launched a limited-time initiative dubbed Race to Rewards Exchange. It involved a digital game in which people competed for the chance to win a Tesla Model 3 automobile plus electronic bikes and skateboards.
According to a mid-April survey of 2,238 U.S. adults by Paytronix and PMNTS, the number of people using restaurant loyalty programs rose 12% from Jan. 22 to April 22. Within the QSR space, the increase was 24%.
The survey determined that millennials and so-called bridge millennials—ages 32-41—are “chiefly responsible for the uptick in restaurant reward signups that occurred between January and April.”
Other age groups' restaurant reward program sign-ups “have been far more modest,” Paytronix and PMNTS wrote in an analysis of the survey results.
“Generation Z and Generation X restaurant customers are equally likely to use loyalty programs, as 52% of each age group do so, but Gen Z consumers have been quicker to sign up for new programs between January and April.”
The survey also found that 57% of restaurant customers who are signed up for at least one restaurant’s loyalty program would be willing to spend more on food orders from other restaurants if they could use loyalty and rewards options.