Subscriptions are becoming the norm in many other industries. Its a means and way to create consistent cash flow, communicate with your customers and reinforce loyalty.
Recently I am beginning to witness the subscription strategy in the foodservice sector. Mainly in QSR with a complimentary/discounted food or drink item. From a customer perspective it is a value equation-they pay a nominal fee for something greater if they were to pay the actual menu price. And for operator, with so much competition for the customers commitment and cash, they realize the subscription model as an innovative strategy to drive more guest visits, engagement, and a long-term term loyalty.
For example, Subway US in August 2022 launched its first Footlong Pass subscription program, which discounts the item 50% once a day throughout September, and they sold all 10,000 of the available $15 passes in six hours. The Milford, Conn.-based sandwich chain said the Footlong Pass was created for its MyWay Rewards program members, allowing them to order one Footlong sandwich per day for the month on the Subway smartphone app or at Subway.com.
There are several other examples in foodservice, but will they become mainstream, or will customers disregard due to subscription fatigue from so many other sectors?
For the casual dining segment, which has suffered the greatest losses, I perceive this as an opportunity to engage guest trial, increase repeat visits and drive desperately needed dollars on a consistent basis. And unlike traditional loyalty programs which are somewhat passive, knowing the guest has paid upfront, they are more likely to redeem for their reward on a regular basis.
As well, pending the offer, the guest will most likely dine with other family and friends. Consequently, for a nominal discount/incentive, both the guest visits and cheque average will certainly increase. And in the case of Subway’s Footlong Pass subscription program, it netted $150,000 which definitely bolstered the bottom line.
Today with so many mainstream loyalty programs, I believe that the subscription model can be the prescription, the point of difference, not only for QSR but the casual dining segment. Consumers are comfortable with subscriptions, the nominal monthly fee is not a hindrance, and most likely they are going to play where they already paid. Hence increased visits, traffic, and revenue.
Do you think subscriptions are the prescription to increase sales and loyalty?
Scott Moore, President of Stir Creative Communication Inc., has been helping foodservice and hospitality suppliers and operators increase sales for over 30 years. For innovative and revenue-increasing programs, marketing and promotional campaigns and much more, contact Scott at 905-484-3094, scott@stircommunications.ca, or visit www.stircommunications.ca.