Ten questions to ask before implementing a gift & loyalty program.
1.Are there fees?
2.Is it gift, prepaid and loyalty?
3.Do I have to buy cards from you?
4.Who owns gift data?
5.Is the gift data encrypted?
6.Is it multistore capable?
7.Are the cards re-loadable?
8.Can you design the front and back?
9.Pooling (Franchise only)?
We get asked a lot about the Pros & Cons of Gift & Loyalty. Here are some thoughts based on what we have seen from customers:
Credit Card Company
3rd Party Gift Card
Touch Screen on Counter
And then we come to the POS side of things. Want to know more about how we can help with that? Visit http://www.selbysoft.com/Gift-and-Loyalty-ideas-for-coffee.html
.A great Point of Sale system is one of the most important pieces of equipment you will buy for your location. Think about this – Almost zero national chains skip POS when opening a new location. Starbucks, Peets, Caribou, and more all have point of sale systems in their stores.
Why? I can tell you it’s not because they just enjoy spending money! It’s because they see the proven value of a good POS system when opening a coffee shop.
Look at some of the points that POS can help with:
Labor – keeping your labor costs under control is one of the biggest ways to save money. SP-1 for Coffee with help you stop early clock-ins. An extra 10 minutes at $10 an hour is $1.66 a shift. Multiple that by a couple shifts a week per employee and you could be paying $1,500 – $3,000 a year in extra wages. Take a deeper look and see how labor costs can be adjusted by viewing your on the fly labor percent.
Zero Training – SP-1 will make taking orders in your coffee shop easy. This is a bit harder to quantify but easy means less mistakes. Because the point of sale has all the prices set, employees simply make less errors. This helps you and the customer. Remember consistency is important in your pricing. If 10% of your orders are off by $.50, that is a huge amount a year. Easy means
Gift & Loyalty – This is the number one way to help increase customer retention. Gift and prepaid cards help bring cash in the door and increase average dollar per ticket totals. Customer reward programs are proven to be effective when handled right. We have seen customers use the gift & loyalty program to reduce credit card charges as well as decrease the speed of service.
Look & Feel – A cash register is not cool. Customers don’t trust them and they make your shop look inefficient and not quirky. There are all different types of equipment available for you to use. Wall mount options as well as counter options are available.
Gift and prepaid cards can be one of the best ways to promote your coffee shop. Here are 3 GREAT gift and prepaid card ideas we have gathered from customers of our cafe, coffee & pizza point of sale solution.
1) Buy a card, get something free. The key to this is to really push this with customers that pay with a credit card or cash. Those are the customers of your coffee shop that don’t have a card already. If I don’t pay with a prepaid card, then you are missing out! This could be $30 and your drink is free or $50 and you get bread sticks free.
2) Offer a VIP discount for paying with the card. It’s simple really. If they use the card, they get sort of VIP bonus. Offer a free extra shot of espresso, a free flavor shot or topping on a pizza. This pushes the customer to always have money on their card in order to get the reward.
3) Offer a cash back reward system. Instead of working with buy 10 get 1 free, use our percentage cash back system. This method of loyalty/rewards, allows you to push a percentage (think 5-10%) back to the customers gift card. The customer then always has a balance on their gift card! It is a great way to “train” customers to use their cards on a regular basis.
Want more ideas? Check out more of our blogs on gift cards.
SP-1 has a very powerful gift and rewards program that is 100% free. I thought I’d be fun to cover the three different options we have for rewards in the system.
1) Buy 10 get 1 free. There are a number of variations on this but the basic premise is that a customer gets one free drink for every ten they buy.
Pros: The great thing about this is that it is simple and easy to explain. Your customers will feel that they are getting something free. The theory is that customers keep coming back as they have that next reward to look forward to.
Cons? It’s only really available in one category. Also, it encourages customers to buy cheap drinks and then ask for a more expensive drink as their free one. That can actually be a pro however. We have customers that encourage the free drink to be something the customer does not normally try.
2) Points. This is a variation on the above. Instead of earning rewards based on the quantity of drinks purchased, it is based on the dollar amount purchased. Usually one point equals one dollar. For example – 35 points is a $3.50 drink.
Pros: It stops the guys from buying $2.00 drip and then getting a $5.00 mocha. Also, you can have up to five levels of redemption. For example, 35 points is $3.50 off. $50 points is $3.50 drink and a muffin and so on. Finally, you can use this on more than one category. This is a more flexible version of the above.
Cons: It’s difficult to explain quickly to customers.
3) Percent Back. This is a completely different thought. Instead of points or punches, customers earn a percentage back on each purchase. Usually 5%-10%. This cash back goes on the customer gift card for their next purchase.
Pros: It’s free money to the customer. They can spend it whenever and however they like. This also keeps the customer thinking they have cash on their card. It’s pretty easy to explain as well. From a psychology standpoint, the customer is never getting a free drink. They are always purchasing it with their gift card money. This means you are rarely devaluing your product. Finally, you can easily change the percentage or end the reward at any time because the customer automatically has their money. With the other two methods it can be hard to end the program because the customers perceive that they are losing points or punches.
Cons: They are never really seeing the “free” aspect of the reward.
There you go! Give us a call and see it in action.
We made it through yet another holiday season! Now what?
Now it is time to look back over your gift card stock and see how depleted it is. Often, our customers are so happy about getting through the crazy periods that they tend to let our gift card stocks run low. Take a second and go through your current stock and see if you need to place an order. Remember, gift cards take a couple weeks from time of ordering to the time you receive them.
Our SP-1 by SelbySoft POS has a lot of features. I thought it might be a good idea to cover three reporting figures your coffee shop manager should be looking at. The great thing is that all three of these are instantly accessible from the Business Summary Recap.
SelbySoft has added two new options to our already robust rewards system. Currently SP-1 supports the following:
Buy X get 1 Free: This is a simple method. For example: Buy 10 coffees get 1 free.
Points: In this system you earn points per dollars and then can redeem them at one to five different levels. For example: Every $1.00 spent earns 1 point. You can then redeem 35 points for a free 16oz or 50 points for a small sandwich.
The new method of rewards involves earning a percent of your ticket as a reward. For example: You offer 10% back on all coffee purchases. SP-1 will then automatically keep track of that and give them the ability to apply that as a discount on the ticket! In the example below, the customer already has $4.12 in rewards that can be applied to this ticket.
Of course, like all reward methods, you can specify if they earn points, punches or dollars when a discount is used, limit this by menu categories and sized etc.
The second change that has been made to SP-1 is that you can now specify which group sizes you want to include instead of only excluding. For example, in our current versions you can specify that a customer earns points on coffee drinks but exclude 8oz. With this new method, you can have a different amount of punches or points you want the customer to earn based on the size of the drink. So, you could have 12oz drinks earn a different amount of points than 16oz drinks.
We all want to be that company that knows our customers by heart. Unfortunately, sometimes it can be difficult to remember everything about everyone! If you are using our built in gift and loyalty system, you can get SP-1 by SelbySoft to help you!
It starts with the gift card because that gives you a reasonable reason to ask for a customers name, address, phone, email or anything else you want to track. Not interested in the marketing features? Not a problem, simply collect only the customers name. Once you have this, you can assign their gift card to their name in SP-1.
In SP-1, you can now simply type the customers name or swipe their gift card and SP-1 will pull up their last order. Along with the order, you will have buttons to duplicate their last order and even custom notes about that customer! This makes it very easy for your employees to comment on the last order the customer had.