Taco Bell is looking to integrate customer loyalty programs on their mobile application. The quick-service restaurants(QSR) industry has suffered majorly this year, and the National Restaurant Association has estimated a combined loss of over $240 billion by the end of the year. Customers across the US who earlier relied only on fast food and QSRs, have now switched to home-cooked food or at the maximum, take-out, or delivery orders. The QSRs had to shut down their dine-ins and rely on delivery orders. A lot of smaller fast-food chains have had to shut down shops, the bigger ones have had to lay off hundreds of employees because of lack of work to do, and because of declining finance.
In times like these, restaurants are trying their best to make themselves digital by building order-ahead apps. The smaller or technologically less advanced restaurants have even had to shift to third-party apps like Postmates and Grubhub for their orders to come in. Although these apps take away the companies’ right to supervision over the delivery aspects of the order and other areas, it is enough for survival. Like Taco Bell, other major companies in this industry have successfully brought out their apps and are marketing it out for it to replace traditional in house dining.
Zipporah Allen, Vice president of digital experiences at Taco Bell, said in an interview that Since COVID19 has hit the world, they have realized the importance of a digital presence for their brand and are taking big steps to better that. However, she did mention that the firm had been working on its digital platform since before the pandemic.
Still, the situation accelerated the need for their app launch, even more, thus making it quicker. In these times, customer loyalty is a really important aspect of the QSR industry. The fast-food restaurant chains cannot rely on customers opting to order with them as impulsively or on the spot decision. The customer will consciously have to choose to place an order with them if they want to, and this requires customer loyalty.
In these loyalty programs, restaurants offer customers rewards like points or a free meal if they reach a certain goal by purchasing and repurchasing. Taco Bell will be offering reward points for every dollar spent on an order, and a customer can later redeem this for an added menu item. In the interview, Allen also said, “Loyalty is a huge part of our [digital initiative],” she further added that they do know that when customers are shopping for a digital experience, “they want a one-on-one, personalized experience, and loyalty [programs] lay the foundation for that.”
Taco Bell uses various data analysis tools to understand customer preferences by looking at their previous purchases and then offering them better rewards on items that they are most likely to order. It leads to customers getting drawn to ordering more often with them. Allen also predicted that these customer loyalty programs would stay even after the pandemic is gone. They are well prepared to modify their business models to modify according to the new needs. She proceeded to say, “We are preparing for a big shift in customer behavior, but I don’t know exactly what that’s going to look like.”