Case Study: QSR Chain Drives Revenue With Hyperlocal Tools

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MGMerchant: Mixt Greens
Size: 9 locations
Locations: Los Angeles, San Francisco, and Santa Clara
Platforms: Caviar, Mailchimp, Thanx
Bottom Line: Business owners are most interested in hyperlocal tools that integrate with the platforms they already use.

When it comes to selecting which hyperlocal platforms he’ll adopt at Mixt Greens, the “eco-gourmet” quick-service restaurant chain with nine locations in California, co-founder David Silverglide is clear on what he’s looking for.

“If it’s something that’s marketing- or advertising-based, it needs to be driving incremental revenue. It can’t just be trying to siphon off our existing customer base in a different way, or shifting them to a new platform. It’s got to be proving that there’s ROI on it, and that it’s new revenue. That’s the first thing that really gets us going there,” Silverglide says.

Being located in the Bay Area and Southern California, Silverglide says he’s approached by “a lot” of hyperlocal vendors, and he’s willing to meet with most of the companies that reach out, either via cold pitches or through referrals from friends. What tends to catch Silverglide’s attention the most is when the hyperlocal vendor is pitching a platform that integrates with the tools or systems that Mixt Green already uses.

That was one of the ways that Thanx, a mobile loyalty vendor, impressed Silverglide during a pitch meeting nearly two years ago. Silverglide says he was looking for a loyalty solution that would integrate with MailChimp, which he uses for email marketing. He also wanted something that could work at all nine of his restaurants, and he was interested in a platform that required as little work from his cashiers and other in-store employees as possible. The fact that Thanx was able to help with lead generation, and automate the customer segmentation process, was an added bonus in his view.

“With Thanx, those people that join and opt-in immediately move to MailChimp, and at that point we can then segment the list very quickly and easily on any number of factors, either based on what they’re doing with Thanx, based on their activity in the store, or we can segment based on what they’re doing to the actual emails. We can see how they interact or respond with us, which allows us to fine tune our marketing and segment the target better to get better results,” Silverglide says.

Within three months of launching the mobile loyalty program in May of 2013, Mixt Greens had roughly 3,000 customers sign up, representing approximately 10% of the company’s customer base. Of those customers who signed up, 85% created an account and linked their credit cards, and around 70% were still active at least three months later.

Mixt Greens’ loyalty program also connects with Caviar, the food delivery platform that was acquired by Square earlier this summer.

“So our customers order online, and because it’s tied to a credit card, we don’t need to have anything in place on our end. All we have [to do] is generate single use codes to the Thanx customers, so they get rewards through their credit card payments,” Silverglide says. “Then when they hit the reward level, it generates the correct single use code for whatever they’re doing, and they can walk into a store, and that’s the only piece of information we need.”

That type of simplicity is important to Silverglide, regardless of the hyperlocal marketing channel he’s using. Being able to determine ROI is also something that Silverglide takes into consideration before implementing any new programs into his business.

“With Thanx it was easy, because we already had a benchmark with an old [plastic loyalty card] program. With other platforms, it comes down to standard ROI metrics, either top line revenue, bottom line revenue, or increases in customers,” Silverglide says. “It’s a little bit harder when you don’t have a bench line and you’re trying something completely new.”

Going forward, Mixt Greens is building its own internal inventory ordering and back office system, which Silverglide hopes to integrate with the hyperlocal tools he’s already using.

“We knew exactly what we wanted, so we were able to scope it and build it,” he says. “Really the next step for us is—they’re tied in, but they’re not as tightly integrated as I want them to be.”

The Takeaway
The quality and sophistication of the marketing tools a hyperlocal vendor builds are important, of course, but what business owners are really looking for is the ability to integrate those tools into the marketing platforms they already use. Hyperlocal vendors should consider increasing the number of channel partners they work with, or at least making it easier for clients to integrate their tools into existing digital marketing programs, if they want to attract a larger base of SMB clients.

Stephanie Miles is a senior editor at Street Fight.

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Stephanie Miles is a journalist who covers personal finance, technology, and real estate. As Street Fight’s senior editor, she is particularly interested in how local merchants and national brands are utilizing hyperlocal technology to reach consumers. She has written for FHM, the Daily News, Working World, Gawker, Cityfile, and Recessionwire.