More than 70% of restaurant customers are uncommitted today, transacting across various brands and formats in order to best meet their personal needs.

Tasty Restaurant Group, a franchisee operating more than 400 restaurants east of the Mississippi River, is acutely aware of the challenge that these customers present.

“Winning customers in this day and age has changed,” said Sylvia Havel, Tasty’s VP of Marketing. “Things like great product innovation, great value, and friendly environments will bring customers back, but you still need to have another edge.”

In early 2023, Tasty partnered with Upside to be that edge. Upside’s multi-category marketplace, which reaches over 35 million American consumers, uses personalized promotions to win more trips and more profit for partner retailers like Tasty. 

Known for its sharp operational oversight, Tasty regularly audits its slate of investments to ensure that they’re delivering a return. In line with that policy, Tasty recently worked with a third-party analytics firm to validate Upside’s incremental impact.  

Across all Tasty’s brands on Upside, the analysis concluded that Upside is driving results. Not only is Upside capturing new users for the franchisee, but these users are of demonstrably higher value than the general population. 

For Tasty, the ability to meet customers where they are — and adapt as needs and preferences evolve — has laid the groundwork for a “wonderful partnership” with Upside that they enthusiastically recommend to their peers.

Read on for the detailed results.

Inside the analysis

In order to complete this independent study, South Shore Analytics, an independent consulting firm, measured Upside’s performance for four of Tasty’s brands: Pizza Hut, Burger King, KFC, and Dunkin’ & Baskin-Robbins. 

South Shore created an independently derived, transaction-level analysis of Upside’s incrementality, then compared its own summary results to Upside’s findings. Additionally, South Shore set out to determine if any biases existed in the control groups that Upside pairs with each user.  

South Shore’s analysis also measured Tasty’s return on investment (ROI) by brand to ensure that its relationship with Upside was benefitting the franchisee’s bottom line. It also looked at profitability across different types of purchases — those combined with other promotions, for example, and those not.

The results: Valuable customers, incremental profit

What South Shore found was clear: Upside is the edge that helps Tasty win customers in the uncommitted age. And the program is even exceeding expectations for the franchisees. 

Because of Upside, Tasty Restaurant Group is attracting more high-value customers to its restaurants. They’re spending more than they used to and more than their peers who aren’t claiming offers on Upside. Across all brands, South Shore’s incremental revenue calculation came within 2.6% of Upside’s reported impact — a difference that is comfortably within the 90% confidence interval for statistical significance. 

ROI

South Shore evaluated the impact of every dollar that Tasty invested in its partnership with Upside. In the end, the analysis concluded that Upside delivered an ROI of 75% or greater to each of its brands. In other words, when Tasty put a dollar towards Upside at its Pizza Hut restaurants, $1.87 came back to the franchisee.

Increases in spend

South Shore analyzed two changes in customer spend because of Upside: individual pre-period vs. post-period spend of Upside users, and actual vs. control spend comparing Upside users to non-Upside peers. By both measures, Upside is measurably increasing the amount of money that customers spend at Tasty restaurants.

First, customers began spending significantly more after they started using the Upside app — in some cases, more than doubling their previous spend levels. 

Additionally, once a user begins using Upside, they greatly outspend their control group, regardless of the brand. And when South Shore took a closer look at Upside’s control groups, it found a tight mapping between actual and control cards, with zero or negligible bias detected across brands and across customer types.

Retention

South Shore compared the six-month revenue retention figures for Upside users and the general population. In their first two months after claiming an Upside offer, these customers were clearly spending more than other customers — proof that Upside helps Tasty stay top-of-mind with their customers.

Accounting for double-discounting

One of Tasty’s primary concerns before the analysis was whether they were “double-discounting” for Upside customers — reducing their margins to negative levels when customers stacked brand deals with Upside offers.

South Shore found this wasn’t the case. The firm calculated the impact of Upside users’ double-discounting, and it found across all four brands that these transactions remained profitable for Tasty. In instances where two promotions were used, both the cash back paid to the customer and the profit-sharing fee paid to Upside decreased to protect the profitability of the transaction. Tasty is also protected by our incremental margin calculation, which includes the cost of the average discounts that they see on orders.

“Upside provides us with a way to find new guests, build loyalty, and have them come back repeatedly,” Havel said. “I think it's just a wonderful partnership that we’ve forged.”

Curious how Upside can benefit your restaurant’s bottom line? Get in touch with our team of industry experts to learn more.