El Pollo Loco spices up loyalty program with location-based app expansion

Brief:

Restaurant chain El Pollo Loco this week expanded its app-based loyalty program nationwide, letting customers gather points for future purchases. Users of the Loco Rewards app can track their rewards points, which they earn from mobile orders and by using their smartphone camera to scan receipts at pickup windows, per an announcement.
Loco Rewards members earn one point for every dollar spent and receive a $5 reward after accumulating 50 points. El Pollo Loco claims that the reward program is the "the most competitive in the industry." The chain offers customers free chips and guacamole for signing up.
El Pollo Loco is incentivizing customers to register for rewards and continue returning to the restaurant with special deals and discounts as well as by adding a feature to the Loco Rewards app that enables curbside pickup via the GPS technology in smartphones, which goes live on Sept. 28.

Insight:

El Pollo Loco's expansion of Loco Rewards provides more compelling reasons for customers to sign up for its app-based rewards program and to keep coming back. With many restaurants facing declining sales because of restrictions on indoor dining during the pandemic, El Pollo Loco can use the app as a promotional channel to drive mobile and takeout orders that have become a lifeline for the industry. By letting customers see how close they are to receiving a loyalty reward, El Pollo Loco is using a gamification strategy that urges repeat business.

Under the guidance of CEO Bernard Acoca, who joined El Pollo Loco in 2018, the restaurant chain has been revamping its marketing with a stronger digital focus instead of the previous heavy dependence on TV and print. To reach younger consumers who are more likely to order food from quick-service restaurants, El Pollo Loco shifted almost one-third of its media budget to digital channels, Mobile Marketer's sister publication Marketing Dive reported last week.

App-based loyalty rewards are popular among tech-savvy consumers, who are more likely than the general population to belong to a broader range of loyalty programs, a survey by payments consulting firm Mercator Advisory Group found. Fifty-four percent of "tech forward" consumers said they belonged to a fast-food loyalty program, compared with 32% of average consumers, the survey found.

Those percentages are likely to grow as restaurant chains like El Pollo Loco develop mobile apps for loyalty programs. Apps provide greater convenience to customers than requiring them to carry plastic cards or key fobs that aren't interactive. El Pollo Loco isn't alone in offering mobile-based rewards. Taco Bell two months ago rolled out an updated rewards program as part of an expansion of its digital properties to connect with mobile customers. In July, burger chain Wendy's started its first loyalty program to let customers earn points from mobile and drive-thru orders.