Forget the old "buy 10 sandwiches, get one free" business model. A new loyalty program in Chicago is offering customers quirky rewards such as an arm wrestling match at a restaurant or a date with a baker at a cupcake spot.
It's all part of Belly, a digital loyalty rewards program for more than 500 businesses in the Chicago area launched in August by Logan LaHive, who teamed up with Lightbank, the investment fund behind Groupon. Looking to expand into other cities across the country, Belly helps businesses replace the "buy 10, get one free" punch cards with the use of one card or a smartphone app. Customers can cash in points redeemed for purchases for offbeat prizes.
It's 125 points to arm wrestle an employee at Snarf's eatery in the Goose Island neighborhood. To a worker in the stomach at Andersonville's AlleyCat Comics bookstore, it's 250 points. A 20-minute in-store date with a cupcake girl at Molly's Cupcake in Lincoln Park will set customers back 500 points.
"I have a wallet full – like everyone else – a wallet full of 20 or 30 different punch cards and I started to look at my phone and I was starting to get apps for Starbucks and Snarf's and Jamba Juice and all these other places and I thought there was a better way," he said.
Going to a restaurant 10 times to get a free sandwich may not be all that exciting either, he said. Besides, punch cards typically have under a two-percent redemption rate and don't provide any data about its customers, he said.
Customers can sign up for the program in the store or download the Belly app for free to their iPhone or Android. They scan the barcode from their phone or the card itself on the in-store iPad supplied to the business by Belly. Every time they check in, they earn points toward a reward, which can be obtained with as little as a few visits for a free fountain drink (15 points) at Devil Dawgs in Lincoln Park up to all-you-can-eat Chicago Dawgs for 10 minutes (100 points).
The creative rewards and corresponding point value are customized to fit the individual business, its culture and its goals. Participating businesses are as small as Gordono's Pharmacy in Andersonville where customers can play rock, paper, scissors for a small coffee for 20 points, or as big as corporate chains like Chick-fil-A in the Gold Coast, which offers a free party for up to 10 friends for 250 points.
"It's not just kitsch for kitsch's sake. We try to create rewards 1.) that people will talk about and 2.) that people are actually interested in trying to achieve," LaHive said.
The idea is if customers want the reward, they'll keep going back to the business to get the points and spread the word to their friends about what they're trying to earn. Punch cards and coupons don't really drive loyalty, he said. Instead, it's more about the experience and service.
Rewards range from the traditional free medium cup of coffee at Dunkin' Donuts at the Thompson Center (50 points) to the unique beating up a trainer for one minute at LA Boxing in the South Loop (650 points).
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