- Most of South Africa’s coffee chains now have some form of loyalty programme.
- At best, most offer between 2% and 5% of your spend back in points, which you can redeem later, subject to terms and conditions.
- In most cases, this means you'll need to spend hundreds of rands – or buy dozens of coffees – before you can get a single coffee for free.
- Their apps, most of which are built by a single company and used widely by competitors with custom branding, have a raft of non-loyalty features, and require personal information that the companies can use for marketing purposes.
- One company, however, has kept its programme simple and reward value high, making it a clear winner.
- For more stories go to www.BusinessInsider.co.za.
Most coffee shop chains and quick service restaurants in South Africa will now reward you for returning – but the rewards aren't necessarily handsome.
According to loyalty programme consultants Truth, of the top ten most used loyalty programmes in South Africa within the restaurant and quick service restaurant industries, four – Seattle, Mugg & Bean, Vida E, and Bootleggers – are almost exclusively coffee sellers. And Kauai, whose reward programme is the most used of any in this sector, is edging into the coffee market with its own coffee promotions and rewards.
Although a surprising number of these brands are making use of the same white-label smartphone app built by wiGroup, quite how much each is willing to reward you varies. And in some cases, it appears as if the app has as much to do with up-selling and data mining – with an agreement to receive marketing messages – than it does truly rewarding customers for their loyalty.
Most stores have bought into a now-familiar points-based system, which rewards members by giving them a small percentage, usually between 2% and 5%, of their rand spend back in points, which can be redeemed against future purchases.
This, according to Truth and BrandMapp’s latest Loyalty Whitepaper, is roughly in line with what consumers expect; most enjoy reward programmes that offer cash back (63%) and discount vouchers (45%).
But Truth also points out that consumers appreciate rewards programmes that champion simplicity, both in earning and claiming. This often falls away when shoppers have to register, share personal details, tally points, and calculate cash backs and eligibility, although the now ubiquitous wiGroup loyalty app does its best to resolve these pain points automatically.
Only one coffee chain, Seattle Coffee Co, is still bucking the trend, and is keeping its reward programme in line with a more advanced iteration of the traditional stamps-based system. Its value and simplicity make it a clear winner in our books.
Here’s how the loyalty schemes offered by South Africa's coffee chains compare.
Vida E Caffe
Vida E Caffe has migrated its loyalty programme from physical card to its mobile app, a move now familiar in this sector.
Vida E Caffe says they only “collect as much information as we need to provide the services on the app to you”, but to register you’ll still need to part with your name and surname, phone number, email address, province and gender, and they’ll also request your date of birth.
You’ll also need to insert your credit card details and pay via the app in order to earn points.
By signing up on the app, you’re agreeing to receive marketing messages via SMS and email - and there’s no clear way to opt out of these without leaving the programme.
With the admin out the way, Vida’s reward percentage is fairly generous. For every purchase made using the app, members receive 5% back in points that can be used to make a partial or full payment towards an order. Loyalty points reflect immediately and will expire after three years.
Spend to earn a small Americano (R25): R500, or buy 20, get one free.
After initially stumbling in South Africa, Starbucks has pushed ahead with plans to open more stores across the country - and they’ve also launched a points-based loyalty programme that is suitably confusing.
Members can purchase a card in store, but can also register on an app to pay for orders and receive rewards. Registration for the programme is via a native app, but members have the option to opt out from Starbucks marketing emails.
Rewards members earn “Stars” for every R2 spent on qualifying items via the Starbucks app or after swiping the card, which reflect within 24 hours. Members then receive a “free reward” for every 250 stars collected.
There are also two benefit levels within the programme - Green and Gold - which have different occasional rewards on offer.
Green level members must earn at least one star per year, and rewards include one complimentary beverage or food item. Gold members must earn 750 stars in a year to retain this status, and rewards include those of the Green level, plus others like birthday rewards, free upgrades to Origin Espresso, and free refills on brewed coffee.
Spend to earn a small Americano (R27): R500, or buy 18.5, get one free.
Kauai has a new app that it promises will make eating healthier easier and more rewarding in what is “a first for South Africa”. However, it too was built by wiGroup.
Registration follows a familiar process, and requires information like gender, full name, email address, and telephone number before you can proceed. By registering you are giving permission to use your data, and automatically opting in to receiving SMS or email marketing.
There are three tiers in Kauai’s reward programme: Green, Gold, and Black. Members can climb the ladder by earning points at the rate of one point for every rand spent in the app.
There’s little to pick between the levels in realtime rewards, unless you’re into attending Kauai events. Each tier does, however, provide increasingly more valuable secondary benefits on your birthday, a free coffee, smoothie, or coffee and breakfast bowl, depending on your level.
In terms of real rewards, all tiers offer 2% cash back, in the form of points, for each purchase. These reflect instantly and do not have an expiry date.
Spend to earn small Americano (R25): R1250, or buy 50, get one free
Seattle Coffee Co
Seattle Coffee Co’s reward programme has the highest usage level of all dedicated coffee shops in South Africa, according to Truth.
The loyalty programme runs entirely off a 10 digit number of your choice, though Seattle says most use their cellphone number. Members enter this on a dedicated keypad when signing up, earning, and claiming. Seattle is at pains to assure members that their number is kept private, baristas can’t see it on their point of sale systems, and it’s not used for marketing purposes.
Seattle’s loyalty programme bears little resemblance to those of its competitors, and more to reward programmes of days gone by.
There is no cash-back option, nor points that members have to redeem. Rather, after 10 individual beverage purchases, members can claim one free beverage of their choice, regardless of size or additions.
Members also don’t have to claim the drinks immediately, and can bank them until they wish to cash them in for freebies.
Unlike other points- and app-based reward programmes there’s no way to remotely check how close you are to earning a reward, and members can’t claim points against items other than beverages.
With every 11th beverage free, this means members could conceivably buy the cheapest qualifying item on the menu, typically around R20, ten times, and then claim the freebie for the most expensive, which is more than double that price.
Spend to earn small Americano: R200 (based on cheapest beverage on the menu), or buy 10, get one free
Bootlegger Coffee Company
Burgeoning coffee chain Bootlegger has scrapped its original, popular rewards programme, which followed a similar model to that of Seattle Coffee Co's, and has instead opted for the same model as other competitors: a points-based app built by wiGroup that looks like many others. To install the app members must agree with the terms, which include granting Bootlegger permission to contact you with marketing and promotions via SMS or email.
The company will reward customers with an undisclosed “percentage back” for each purchase that the company confirmed is "variable". At present, members can earn 2% back on each purchase. Loyalty points will reflect immediately and expire in three years.
Spend to earn small Americano (R28): R1,350, or buy 48, get one free
Mugg and Bean
Mugg and Bean’s “Generosity” reward programme is the fifth most used in the sector, but it too appears to be built on the back of an app and system used by many other competitors in the market.
Mugg and Bean requires users register via a form on the app and provide personal and contact details that the group can use for marketing purposes, both internally and via third party suppliers. The company immediately takes the opportunity to use these details, too, by sending a promotional SMS.
Once registered, members receive points, also called “beans”, with every qualifying purchase. These are valid for two years, and members must be active at least once a year or Mugg and Bean will forfeit all points.
Mugg and Bean does not make it immediately clear how much cash back members will earn with each purchase, and a call to the company’s head office was unable to confirm this either.