IHOP Customer Engagement Strategy: A Case Study
A year of automated customer engagement.
For 58 years, the IHOP family restaurant chain has served world famous pancakes and a wide variety of breakfast, lunch and dinner items that are loved by people of all ages — offering an affordable, everyday dining experience with warm and friendly service. IHOP is a large and very successful casual dining restaurant chain. In May of 2015, they searched for a new customer engagement strategy as a means to achieve these goals:
- Staying top-of-mind in a highly competitive restaurant industry.
- A total digital customer engagement platform to promote special offers, encourage email club sign-ups & boost retention.
- A digital loyalty program that is extremely easy to sign-up for customers and easy to maintain for their restaurant staff.
- A customer rewards program free of apps, punchcards or swipe cards.
- Simplify application process for potential employees
IHOP kickstarted a complete customer engagement platform in May of 2015. They decided to do a 10-store pilot test to see if the program fit their needs. Later, in December of 2015, IHOP added 16 restaurants and in June of 2016 they added 22 more locations.
Here are some numbers for the program after over a year of customer engagement:
As of 8/1/2016, IHOP has over 45,000 loyal subscribers with a total of 114,145 check-ins. They currently offer their subscribers a choice of $5 OFF $10 or $10 OFF $20 every 5 times they check-in at a location. This loyalty offer has been completed over 10,000 times.
IHOP uses an auto-responder product within the program that sets up SMS or MMS text messages sent to subscribers automatically when a subscriber doesn’t check-in for a certain period of time. These kinds of auto-responder messages help retain customers by giving them a reason to visit again while staying top-of-mind. They also use one auto-responder to help encourage sign-ups to their email club, which they call “Pancake Revolution”. Twenty minutes after a subscriber signs up the first time, they receive a welcome text message, which welcomes them to the loyalty program and invites them to join their email club. They utilize a custom mini-url and of the 19,938 text have been sent asking customers to join Pancake Revolution club there have been 17,097 clicks.
IHOP’s customer engagement program keeps improving as they gain more loyal subscribers. Here are some “Year to Date” figures:
- After 20 days with no check-ins, they offer $3 off $10, sent to 6,547 subscribers and redeemed 253 times, (3.9%)
- After 40 days with no check-ins, they offer $5 off $10, sent to 4,612 subscribers and redeemed 134 times, (2.9%)
- After 60 days with no check-ins, they offer a Free Short Stack of Buttermilk Pancakes, sent to 3,152 subscribers and redeemed 41 times, (1.3%)
2016 Year to Date
Returning Monthly Customers
Multiple check-in subscribers
(checked in 5 times)
(checked in 5 times)
Year to date IHOP has added 29,637 new subscribers & over 7,000 returning monthly customers. 11,728 subscribers have checked in more than once. 7,585 subscribers have completed the loyalty offer requirement. That means that number of people have checked in 5 times. 5,017 have actually redeemed the loyalty offer, meaning they checked in 6 times.
Over the last 12 months IHOP has also seen a jump in returning customers compared to new customers. This graph illustrates how IHOP’s returning customers have increased since implementing the new customer engagement strategy.