Case Study: Udi’s Pushes Targeted Messages Using Hyperlocal App
Merchant: Udi’s Food
Size: 6 cafes
Results: 7,200 program signups since September
Bottom Line: Hyperlocal platforms make it easier for companies to have two-way conversations with their most frequent customers.
Getting customers to participate in Udi’s Food’s paper-based loyalty program was never a challenge for Angie Hoagland, director of brand development for the Colorado-based company. But as the years went by, it was the lack of data that Hoagland was able to collect from the punch card program that led her to start looking for mobile alternatives. “We have a lot of very loyal customers, and we know that because they come in a lot,” says Hoagland. “But we don’t necessarily have a lot of data about them, or have a way that we can send out more of a corporate marketing message to them.”
Although Hoagland had considered moving to a hyperlocal marketing program in the past, it was the sale of Udi’s to Smart Balance, now known as Boulder Brands, in 2012 that ultimately served as an impetus for the change. “When next year comes and we’re actually doing our name change and our rebranding, we can share that information with [customers] so they’re not surprised when they show up at the restaurant one day,” says Hoagland.
Udi’s partnered with Mocapay to create a mobile program that is part loyalty, part messaging. In addition to the points that participants earn for every dollar spent, the program allows Hoagland to push marketing messages to her customers’ smartphones. She plans on sending those messages approximately twice each month, however she’s currently giving customers time to get used to the new program before she starts communicating through the app. “About every other week I’ll be sending out a text message promoting either a special that’s going on or a new product, event, discount, coupon — all sorts of different things just to try to keep us front of mind,” says Hoagland. “Twice a month is about the right amount. Any more than that and people get annoyed and start unsubscribing. Any less than that and they forget about you.”
More than 7,200 people have signed up for the program since September, a response that has far exceeded Hoagland’s expectations. “In four months we wanted to get 10,000 people. That was our goal. I thought to myself, if we hit that, we hit the jackpot,” says Hoagland. “We’ve got 7,200 in just a little over a month. We’re signing up 300 or 400 a day.”
The majority of those signups are happening at the point-of-sale, where Udi’s cashiers have been instructed to ask for their customers’ phone numbers as a way to sign up for the program. Although the bulk of the loyalty program’s features are available exclusively to customers who’ve downloaded the company’s app, customers can also elect to participate through SMS.
The determine the ROI of the new Mocapay program, Hoagland is focusing on visit frequency from a loyalty perspective. “We set some goals around that, as well as the average check for a loyalty member versus a non-loyalty member. Then of course you look at what you’re giving out and the cost of the program, versus what you’re getting back,” says Hoagland. “So far we’re very, very pleased with the results we’re seeing.”
In the coming months, Hoagland plans to enable mobile gift cards and integrate a mobile wallet into the loyalty app. “Then you’d have the option of either paying with a gift card, paying with a reward card, or paying with a credit card, but all the information is stored in your Udi’s app, just to make the transaction more seamless,” says Hoagland. “That’s our goal around mobile.”
Udi’s has taken a very strategic approach to the rollout of its new mobile program, ensuring customers are comfortable with the first stage (receiving loyalty points through their mobile phones) before moving on to later-stage plans like sending push notifications and enabling mobile gift cards. Udi’s has also made sure to provide options for customers who’d like to participate in the program but don’t feel comfortable downloading the company’s app onto their smartphones. Customers can participate via text message only, which opens up the program without necessarily decreasing the amount of purchasing data that Udi’s can collect from program participants.
Stephanie Miles is an associate editor at Street Fight.