At their best, loyalty programs can incentivize consumers of all kinds to purchase more frequently from a given company. However, not all consumers promise equal returns on investment. One might imagine, for instance, that it would take a great deal of effort to attract the consumer who visits a given store or restaurant only a few times a month. Meanwhile, offering rewards to someone who already gets lunch and dinner from the same restaurant every day might not have much of an impact. When it comes to loyalty rewards, the real opportunity is in the sometimes-shopper.
“There’s a small portion of our members that make up a big chunk of the business,” Art Sebastian, VP of digital experiences at Casey’s General Stores, told PYMNTS in an interview. “Then there’s a group that is the next level of loyals, and there seems to be an opportunity to engage them even more. We have this opportunity to really message, our breadth of offerings to them, and we believe that as we do that, and they convert in those areas, they’ll join the most loyals.”
Casey’s operates more than 2,300 convenience stores, and it is the fifth-largest pizza chain in the United States.
The February edition of PYMNTS Delivering On Restaurant Rewards report, created in collaboration with Paytronix, found 21% of consumers who only occasionally order from restaurants say that the availability of loyalty and rewards programs would best convince them to increase their meal budgets, and 19% of those who tend to order from quick service restaurants (QSRs) rather than full-service say that online ordering options would do the same.
See also: Loyalty Programs Convert Occasional Customers Into Restaurant Aficionados
Pick Your Poison
Unlike rewards programs that operate on a set discount-per-dollars-spent model or those that allow consumers access to a limited range of items redeemable for points, Casey’s offers its rewards program members three possibilities: Casey’s Cash (which can go toward any purchase), fuel discounts or donations to local schools.
Sebastian explained that the fuel rewards differentiate Casey’s program from pure play QSR competitors, linking the food ordering experience to the company’s convenience store offerings.
He noted that consumers’ choice of options roughly follows the pattern one might expect, with Casey’s Cash being the clear most popular choice, followed by fuel discounts, which are on the rise as consumers begin to return to work in person and their children return to schools.
“Our expectation is we’ll see that uptick, over time, especially as fuel prices go up, so we’ll see people leverage it as a discount,” said Sebastian.
Data from the August edition of our Delivering on Restaurant Rewards report find that free food is consumers’ number one choice of loyalty reward, with 78% of the over 2,000 United States adults surveyed reporting that they would like to be rewarded in this way, followed by the two-thirds of consumers who reported that they would like to be rewarded with customized coupons or discounts.
Read more: Two-Thirds Of Consumers Find Restaurant Rewards Impersonal
“Over time, as rewards members engaged with us, whether it be through the app through the website, or any way, we want to personalize all those experiences,” said Sebastian, adding that everything from deals offered to imagery on the platform is being informed by consumer data to tailor the experience to that user’s needs and desires.
Signed, Sealed, Delivered
In a rough breakdown, Sebastian estimated that Casey’s had 900 stores on DoorDash’s marketplace; 800 to 850 on a DoorDash white-label, Casey’s-branded platform; 750 on Uber Eats; and 400 to 450 stores where delivery is fulfilled in-house.
“When you do it yourself, you obviously have to work on, how do we optimize this?” Sebastian said. “How do we ensure we have the right amount of drivers that meet the needs for orders, but we don’t have extra drivers standing around? So, plenty of work there.”
Data from PYMNTS’ 2021 Restaurant Readiness Index, created in collaboration with Paytronix, found that 12% of all QSR orders were generated via the restaurant’s online delivery channels, while 18% of orders came through third-party aggregators. Plus, almost two-thirds of QSR orders were placed online.
Related news: QSRs’ Lagging Loyalty-Reward Investment Hurts Innovation and Sales
As demand for delivery remains elevated, Casey’s is considering how best to handle order fulfillment in the future, whether to shift more toward an in-house fleet model or to rely increasingly on third parties.
“We are spending some energy in that question,” said Sebastian. “We will see … The unit economics of the business is something we’ve got to continue to work through.”
About a year ago, Casey’s also rolled out curbside pickup chainwide. Many restauranteurs are turning to this channel for its potential to meet consumers’ need for instant convenience without the labor and vehicle costs of delivery. The Restaurant Readiness Index found that 46% of restaurants’ managers and customers believe that curbside pickup options will be key to driving long-term success.
Convenience, Beyond the Four Walls of the Store
Now, Casey’s is working on integrating a wider range of digital payment options into its app, making purchasing an easier and more frictionless experience. Sebastian said these technological upgrades are a broader extension of the convenience category, adding that convenience is “no longer a channel,” but rather a “need state for consumers,” driving consumers’ expectation for speed at the point of sale, among other steps of the commerce journey.
Ultimately, Casey’s goal is not to engage with these consumers in a digital vacuum, but to connect across spaces and digital platforms, turning those who typically frequent one channel into omnichannel customers.
“We don’t push a digital-only shopper, because that’s not the best experience,” Sebastian said. “The best experience is when a guest engages Casey’s at the pump, online, in the app, in our store, and to them, it all feels like Casey’s … We try to be very clear with our guests [in terms of] here’s how to engage us, here’s what’s available.”
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