Shake Shack will launch a loyalty program in 2025

Brief description of the dive:

• Shack Shack will develop a loyalty program in 2025, CEO Rob Lynch said company’s earnings report for the 3rd quarter.
• The new program will build on the brand’s success in driving sales, Lynch said, noting same-store sales increased 4.4% and traffic was positive in the third quarter.
• The comprehensive loyalty program will complement Shake Shack’s focus on technology, including digital kiosks that currently include largest order channel.

Dive Information:

While Shake Shack’s loyalty program could eventually become a driver of sales and customer retention, Lynch cautioned that it is unlikely to be implemented in time to significantly increase sales in 2025.

Shake Shack has an app, and digital channels play an important role in driving sales. But the chain doesn’t have a systematic loyalty program like other quick-service giants like Chipotle.

“I can’t help but find a little irony in this, given that Shake Shack was built on the principles and culture of enlightened hospitality,” Lynch said. “Given this legacy, we have a huge opportunity to provide enlightened hospitality in a world that increasingly craves it, but in a digital format.”

As consumer price sensitivity leads to reduced traffic or slower sales growth across the industry, loyalty programs can help restaurants increase repeat visits and improve their value proposition. Kava reworked remuneration structure this yearand Jollibee launched its first loyalty program in October.