Sept. 12, 2005
The customer loyalty and rewards program at Sambino's Pizza in Lorain, Ohio, is successful, although not high tech. On every repeat visit, customers get increasing discounts on pizza. When a laminated membership card is punched 10 times, that customer gets a Sambino's t-shirt or a 14-inch pizza on the house.
Ernex Marketing Technologies in Vancouver, British Columbia, is on the opposite end of the technology spectrum. Using a centralized computer server connected to its restaurant clients' credit card readers, it collects customer purchase data with every swipe of the loyalty program's customized magnetic stripe card.
Whether loyalty programs are high tech or low tech, customers and operators like them. Tom Bronson, president and chief operating officer of DiamondTouch POS believes many pizzerias that have POS systems already are well positioned for successful loyalty programs.
Because such a high percentage of the pizza business involves delivery, customers already provide operators key data that other companies have to work to get.
"When I go into a Radio Shack, they always ask me for my address and phone number, but I don't like to give it to them," said Bronson, whose company produces POS systems in Lewisville, Texas. "But when I call for a pizza, I give them information because I want my pizza done right and delivered."
All that data, plus customers' order preferences, are stored in the POS, which provides operators a wealth of knowledge about their client base. But to really maximize it, Bronson added, an operator could hire a direct marketing firm to provide even more highly targeted data about his delivery service areas.
"You basically can take your customer data to a company like Mailmark, they'll compare it against the data they have on your entire area, and they can tell you what your market share is in that area," said Bronson.
Unlike other loyalty programs, no membership card or credit card is required for POS data capture, and that's key in a business where so few customers ever come to the store to get their food.
"Who cares if you have a (loyalty) card or not? The POS system is getting all that data for you," Bronson said.
Welcome to the future
While Sambino's system isn't futuristic, Ernex president and CEO James Christensen admits it's the marketing standard for the near future. "There's no question that electronic, what we're doing, is in its infancy. ... It seems like every coffee house or restaurant you go to has some sort of punch card system they're using."
Customer awareness of the benefits will make electronic programs spread, Christensen added, because they'll see the benefits in real time. He also believes retailers and restaurateurs will have to learn that rewarding key customers yields better returns than trying to attract new customers with discounts.
"Discounting and other couponing efforts often are anti-best customer," he said. "Those marketing dollars are spent on the worst customers," he said. "Those who don't want to spend money anyway, and then wait until they get a coupon."