The shift to using loyalty points means customers benefit directly as they order more and more often. Noodles & Co is also gamifying its loyalty program with additional levels and benefits that can be unlocked.
But the most significant aspect of the program’s transformation is mental, moving from a random benefit service to a system “based on [and] targeted offers to individual customers,” Hagen said.
Noodles & Company isn’t the first fast-food chain to make this same shift in loyalty marketing. Chipotle used to have random free burritos for customers who pulled the lucky leaf (the burrito wrapper). Since the start of the pandemic, it has invested heavily in a rewards-based loyalty app.
Point-based rewards not only provide a cleaner value prop for loyal customers, but also represent a valuable change for the business, Hagen said, as the loyalty program generates a versatile first-party data set. . If Noodles is testing new items on its menu, for example, the loyalty program is the best way to measure success because it is a group of known individuals who have given their consent for their data to be used at analytical and other purposes.
While in some ways it’s easier to get people to sign up for a “surprise and treat” type of loyalty program, the rewards aren’t as good for the business.
A program that is not personalized does not need to be anchored by an actual authenticated identity, such as a phone number and email address. Anyone can just show up, sign up, and receive the bennys. A points-based (i.e., data-driven) loyalty program, on the other hand, requires mixing customers through an app setup process.
But once a business has recruited a new member, it has an anchored profile to which it can add all sorts of other data, including online advertising identity data and purchase data.
Test and learn
Noodles & Company’s renewed emphasis on its loyalty program coincides with a marketing strategy that involved moving to multiple new media channels.
App install acquisition marketing comes as no surprise, as Noodles now has its own app and is hungry for installs. But it also recently added CTV and TikTok and plans to test data-driven out-of-home media offerings for the first time this year, Hagen said.
The company’s expansion into channels like CTV and TikTok is tied directly to the overhaul of its loyalty program. While not particularly strong traffic drivers for the program, Hagen said, tracking and analyzing rewarded members is Noodle & Company’s primary way to “understand the different segments and personas to target in portable media spaces,” Hagen said.
In plain English: its rewards members are the core data set that Noodles uses to create lookalike audiences based on the behaviors or demographics it targets.
But his appetite for testing is not limited to the media. The chain has also added and evaluated many new providers focused on its first-party data and loyalty program. For example, Noodles & Co added marketing personalization provider Movable Ink, which works with the channel to model lookalike audiences and analytics based on its customer data. Another new provider is Branch, the mobile deep linking and analytics service.
The loyalty program is becoming increasingly central to Noodles’ marketing strategy as signal loss becomes a bigger challenge for the entire industry. Other data sources, such as online advertising or external data providers who use email to match anonymous profiles, are increasingly “masked by privacy proxies”, it said. -he declares.
Apple’s AppTrackingTransparency (ATT) framework, for example, blocks many emails that might otherwise be used for syncing so that Noodles & Co knows that a subscriber to a news site or other app matches his known client. These connections are less common now because Apple doesn’t allow cross-app or app-to-web tracking. But with a larger proprietary data set — and more customers opting to allow tracking through the loyalty program — the links may come back.
A first-party dataset is like a spider’s web. It doesn’t have to cover everything, but at some point the web hits critical mass and the flies start to get stuck.
Noodles & Co is currently testing more potential providers for media analytics without third-party cookies, Hagen said, which is the next big change on the horizon after ATT.
“These changes are already absolutely affecting our daily lives,” he said of the impending deprecation of third-party cookies in Chrome and Google Android’s upcoming restrictions on ad tracking.
“That’s a big part of why we’re focused on first-party data and growing the reward member population,” Hagen said. “We know the value of this data.”