Amid growing economic concerns, fast-casual restaurant chains are increasingly turning to rewards programs as a strategy to retain and attract customers. These loyalty initiatives, which offer various discounts and benefits to repeat patrons, have shifted from mere perks to essential elements in maintaining customer engagement.
As diners become more price-conscious, brands like Chipotle, Starbucks, Cava, and others are leveraging loyalty programs to foster long-term habits that extend beyond sporadic use of coupons.
“In tough times, loyalty programs become more essential,” noted Peter Fader, a marketing professor at the Wharton School at the University of Pennsylvania. “They become a required ingredient to building and maintaining relationships.”
Data from Black Box Intelligence indicates that in the year ending in May, the restaurant sector only experienced one month of increased traffic, occurring in November. Overall, sales remain under pressure with only 43% of tracked restaurant brands reporting same-store sales growth in May as diners continue to reduce their restaurant visits.
Participation in loyalty programs significantly boosts visitation rates. According to Circana, members of such programs visit establishments 22% more frequently each year and engage with their chosen brands at double the rate of nonmembers.
Starbucks reported having 34.2 million active loyalty members in its latest quarter, with over 59% of U.S. transactions coming from these members. Similarly, Potbelly noted that more than 42% of its sales in the first quarter of 2025 originated from its digital initiatives, which include users of its loyalty program.
Meanwhile, Chipotle boasts over 20 million active rewards members. The loyalty program accounts for roughly 30% of the chain’s daily sales and has allowed the company to steer clear of significant price increases.
“We have really strong brand loyalty among our members,” stated Nicole West, Chipotle’s vice president of digital experiences. “We’re focused on engaging with our members in meaningful ways.”
In light of recent challenges, building consumer loyalty is crucial for brands like Chipotle and Starbucks. Chipotle, for instance, experienced its first same-store sales decline since 2020, while Starbucks has reported a slump in same-store sales for five consecutive quarters.
Contrastingly, Cava is enjoying robust sales growth but is under pressure from investors to sustain its rapid expansion.
Innovative Approaches
The rise of loyalty programs has prompted brands to adopt innovative strategies beyond the traditional value meals.
Cava revamped its loyalty program in October 2024, granting customers more flexibility in earning and spending points. Members can accrue points on each visit and exchange them for various items, such as pita chips or full meals, as well as limited-time offers and in-app challenges. To celebrate National Pita Day, the company introduced a mascot named “Peter Chip” and offered complimentary pita chips to members.
“Guests enjoy seeing periodic surprises and delight moments where we can reward them,” remarked Andrew Rebhun, Cava’s chief marketing officer.
The updated Cava Rewards program has attracted over 7 million members, with a new tiered system set to launch soon, according to Rebhun.
Chipotle has also introduced a seasonal campaign dubbed “Summer of Extras.” This initiative aims to distribute over $1 million in free burritos, incentivizing customers to increase their visits and compete for the title of the top Chipotle visitor in each state.
“We continue to see activations in this program build and excitement and positive reactions across social media from our fans,” West commented. “We remain focused on delivering value through programs that reward customers for specific behaviors.”
Salad chain Sweetgreen has also revamped its loyalty program this spring, moving away from a tiered subscription model that many found confusing.
“In a challenging industry where consumers are becoming more deliberate about their spending, SG Rewards aims to provide meaningful value,” said Sweetgreen co-founder and CEO Jonathan Neman during the company’s quarterly conference call in May.
Even Starbucks, an established leader in the rewards space, has made adjustments. In June, it replaced its 25-star reusable cup bonus with a system that awards double stars across all purchases. While this change was met with some criticism from loyal customers, Starbucks reported steady participation rates.
Providing free rewards does present challenges, particularly in an industry where profit margins are often tight. However, restaurant chains are banking on these incentives to foster long-term loyalty and stimulate spending on full-priced offerings.
Focus on Long-term Benefits
Brands grappling with economic pressures are discovering that loyalty programs can significantly enhance customer visits.
Potbelly redesigned its loyalty program in early 2024, adopting a coin-based structure that enables customers to redeem rewards more swiftly and across an expanded menu. Patrons can now access over 14 menu items via the rewards system, which has spurred more frequent visits, according to Potbelly’s chief marketing officer, David Daniels.
“We observed an immediate lift in engagement,” Daniels noted. “The feedback has been overwhelmingly positive.”
Chicago-style eatery Portillo’s launched its first loyalty program, “Portillo’s Perks,” in March. This program employs a digital wallet system instead of a conventional app and emphasizes customer frequency, awarding badges for each visit.
“This approach provides flexibility in how we manage the program,” Garrett Kern, Portillo’s vice president of strategy and culinary, explained. “It allows us to deploy it in a branded, user-friendly way without needing a redesign or relaunch of an application. Our goal is to achieve 1.5 million to 1.7 million sign-ups by mid-summer.
— Finance Newso’s Amelia Lucas and Jacob Pramuk contributed to this report.
