Many restaurant loyalty apps face challenges in the competitive dining landscape. Despite having thousands of active members, you're still watching regular customers visit your competitors regularly. That's not to say investing in your own program is a bad idea, because the problem isn't program design. It's that loyalty apps for restaurants have become table stakes in an industry where growth requires additional strategies.

Our latest research shows a gap between loyalty program participation and actual customer behavior. The average diner belongs to multiple restaurant loyalty programs. This pattern means loyalty programs tend to reward existing customer behavior rather than generate new visits, which may explain why visit frequency and customer lifetime value haven't increased as much as expected despite growing membership.

Your loyalty program is working as designed — it's maintaining customer expectations and providing data about your regular diners. The opportunity lies in enhancing these efforts with complementary strategies that drive new customer acquisition. Below, we'll explore how to maximize your loyalty program's effectiveness while adding performance-based customer acquisition that delivers measurable growth on top of your existing retention efforts.

What loyalty apps for restaurants actually deliver versus your expectations

Restaurant operators invest in a loyalty app to increase visit frequency and boost average transaction values. It's a smart idea, but it's one that nearly all brands are pursuing — across the industry, restaurant loyalty apps have evolved toward standardized features. Most programs includes points for purchases, exclusive member pricing, birthday rewards, and push notifications about special offers. With so many similar features, it's challenging to differentiate your program from competitors.

Analysis of transaction data helps explain why loyalty programs can feel effective while market share remains unchanged. The customers most inclined to join your app are often already frequent visitors, which can create patterns that suggest stronger program effectiveness than actual behavior change indicates. This means programs may be rewarding existing customer behavior rather than generating new visits.

Understanding the full cost of restaurant loyalty programs

Your loyalty program costs extend far beyond the monthly platform fee — you're investing in technology, staff training, reward fulfillment, and promotional campaigns to drive downloads. A common challenge is that many reward redemptions come from customers who were already planning to dine at your restaurant, which can impact the program's return on investment.

Standard restaurant analytics present measurement challenges when trying to assess true incremental impact. Your dashboard shows member versus non-member spending, but it's difficult to isolate which transactions occurred specifically because of program membership versus natural customer patterns. Real restaurant data reveals an important insight — loyalty program members and non-members often show similar visit patterns, suggesting that programs are successfully retaining customers who were already inclined to return.

The performance-based solution that complements your loyalty program

Performance-based customer acquisition changes how you invest in growth by tying all costs to measurable business outcomes. Rather than upfront investments with uncertain returns, you only pay when platforms deliver verified incremental transactions — purchases that wouldn't have occurred without the intervention.

Performance-based platforms work alongside loyalty apps by focusing on different customer segments:

• Target new customers: Identify consumers who aren't currently visiting your restaurant and present them with personalized incentives calculated within your profit margins
• Drive trial visits: Create promotions designed to attract first-time diners rather than reward existing customer behavior
• Enhance existing efforts: Drive new customers who become candidates for your loyalty program enrollment, working with your current app rather than against it
• Provide verified measurement: Match users with control groups to verify incremental impact, offering clear profit data alongside your existing program analytics
  

This approach delivers measurable results. Restaurants using performance-based platforms see more new customers and higher visit frequency from occasional diners, with clear return on investment that you can track and verify.

How to evaluate your loyalty program and take action

Start by calculating your true loyalty program ROI using these specific metrics:

• Total program investment: Include platform fees, staff time, reward costs, and promotional campaigns
• Incremental revenue: Track customer spending for 90 days before and after program enrollment to isolate behavior changes
• Control group analysis: Compare your loyalty program members' spending to similar non-member customers during the same period
• Attribution verification: Document which transactions you can definitively trace to program-driven behavior changes versus expected visits
  

Most restaurant operators discover their loyalty programs are performing well for customer retention, and adding performance-based customer acquisition can enhance those results by driving new customers into your existing program.

Consider adding performance-based customer acquisition that works alongside your existing loyalty app. This dual approach allows you to maintain customer expectations for loyalty rewards while exploring measurable new business opportunities that can enhance your program's effectiveness.

Performance-based platforms offer restaurant operators additional accountability beyond traditional loyalty app metrics. You receive detailed reporting on incremental transactions, new customer acquisition, and profit impact — all tied to verified behavior changes rather than membership statistics alone.

As the restaurant industry becomes increasingly competitive, relying solely on loyalty program enhancements may not provide sufficient differentiation. Consider customer acquisition strategies that deliver proven incremental profit while working alongside your existing loyalty investments to maximize their combined effectiveness.

Ready to explore how performance-based strategies can complement your loyalty program? Request a demo to see how personalized promotions drive measurable incremental visits to restaurants in your market, with payment only for proven results that enhance your existing customer retention efforts.

How Upside works

Upside is a digital marketplace that connects restaurants like yours with nearby consumers through personalized cash back offers. Our platform reaches millions of consumers when they're deciding where to fill up their tank, get their groceries, or dine out at a restaurant, presenting them with personalized promotions calculated within our partners' profit margins. These cash-back offers are strong enough to influence customer behavior, driving new diners to your restaurant while protecting your bottom line through our profit-share model.

What makes us different? We can definitively prove our impact, and we only take credit for transactions that wouldn't have happened without our influence. Our measurement methodology matches each customer with a control group to verify incremental impact, so you only pay when we deliver measurable new business to your restaurant.

We partner with tens of thousands of restaurants across America, and our marketplace model means that as more restaurants join and more customers earn cash back, everyone benefits. Restaurants earn incremental profit, customers get value on dining they're already doing, and communities see more local business activity.

As the restaurant industry becomes increasingly competitive, Upside provides tools to help you reach new customers and grow your market share. Upside gives you the tools to compete by reaching customers who may not be familiar with your restaurant or are currently choosing competitors based on convenience or current promotions. We help turn those opportunities into measurable profit for your business..

Frequently asked questions

What's the typical cost of running loyalty apps for restaurants?

Your program costs vary based on complexity and reward structure, but the total investment often includes more than initially expected. Beyond technology and staffing, consider the cost of promotions, free products, and campaigns you're providing to drive app downloads. The important question isn't your total cost but whether your program delivers measurable incremental profit that exceeds your investment. Performance-based alternatives can eliminate your upfront risks by charging only for proven results.

How do loyalty apps for restaurants actually impact customer behavior?

While your restaurant loyalty software meets customer expectations, it can be challenging to drive exclusive loyalty to your location. Research shows the average restaurant customer belongs to multiple loyalty programs while spreading purchases across several different establishments monthly. This means your program membership doesn't always translate to concentrated spending at your restaurant. Consider positioning your loyalty app alongside customer acquisition strategies that drive incremental business to your location.

Can performance-based customer acquisition work alongside my existing loyalty program?

Performance-based platforms are designed to complement your existing loyalty app, not replace it. These solutions drive new customers to your restaurant who then become candidates for your loyalty program enrollment. The personalized offers target customers who aren't currently visiting your location, while your loyalty program focuses on retaining customers who already know your brand. This dual approach maximizes both customer acquisition and retention without cannibalizing expected sales or competing for the same customer transactions.