Will Subway's Wi-Fi Program Satisfy its Appetite for Customer Data and Loyalty?
The sandwich chain's Northern Ontario franchises feed guests Wi-Fi and direct messaging to gain customer insight and bolster retention.
Photo Source: Turnstyle Solutions
A healthy loyalty program is one that benefits both the brand and the consumer. Quick-service restaurant (QSR) Subway is trying to sandwich both parties' needs and wants together through its Wi-Fi–powered, location-based marketing.
“Loyalty means everything to us in terms of developing an authentic relationship with our customers,” Steve Beaudry, board chair of the local Subway Canada Franchisee Advertising Trust. “We don't discount the value of each and every one of them. If we do our job well, we will have built a community of loyal customers.”
When consumers walk into participating Subway locations in Northern Ontario, they can connect to the restaurants' Wi-Fi network via Facebook, email, or SMS. Once they do they'll receive either an SMS or email message offering them a free six-inch sub of choice, explains Matt Hunter, cofounder of Turnstyle Solutions—the platform provider powering Subway's Wi-Fi-enabled marketing. Every time customers walks into any participating Subway location in Northern Ontario after that first sign-up visit, the Wi-Fi network will recognize them and Subway will be able to send them additional promotions (such as a free beverage or another six-inch sub), Hunter says.
The goals of the program, according to Beaudry, are to increase customer frequency through targeted messaging, engage customers authentically, capture walk-by traffic, gain valuable consumer data, and measure program effectiveness. Melissa Gallagher, VP of Twist Marketing Inc.—the marketing firm serving Subway's Northern Ontario region—says learning more about the sandwich chain's customers is another goal, which she claims hasn't always been easy.
“With traditional research, it's always been a challenge to understand exactly what the consumer is doing,” she says. “They can talk about what they perceived to have been their experience or what they perceived to have spent. As a privately held company, it's not always the easiest to get that information. What we wanted to do was be able to implement something that rewarded the customer, but also gave us a better understanding of what their actual behaviors were inside the store and outside the store.”
Through Turnstyle Solutions' Campaigns and Social Wi-Fi platforms, Subway is able to benefit from the Wi-Fi initiative by obtaining a plethora of data, including demographic information, how long people dwell in stores, the walk-by conversion rate, retention rates, and contact information. Customers opting in through Facebook provides Subway with additional data, including age, gender, interests, and birthday.
Subway then uses this data to segment its messages. For instance, the sandwich chain can send a birthday discount to customers by looking at their date of birth. If guests are frequent customers, Hunter explains, then they're more likely to receive offers exclusive to loyal customers; however, if they're at-risk customers who are starting to stray from the brand, then they may receive different offers over a win-back period. Subway is not using this data for marketing initiatives outside of the Wi-Fi loyalty program at this time.
Gallagher acknowledges that Subway already has a loyalty program—Subway Rewards—but says that the program hasn't been adopted everywhere, including Northern Ontario. Therefore, the Wi-Fi loyalty initiative allows restaurants in this region to find other ways of driving retention.
Since launching the program this past February, Subway has experienced an “overwhelmingly positive response” from both customers and franchisees, Beaudry says. Hunter also declined to offer additional results.
But as Subway's marketing and innovation continues to evolve, it's important for the sandwich chain to identify the customers who are willing to rally around the brand. “Subway has been around for 50 years,” Gallagher says. “For us, Subway is really a community of people who are going to champion us; they're going to be our supporters.... Things change with products, and Subway has been through a lot over the [past] 50 years. So, it's really about building that community of supporters who will be with for the long haul.”