Many quick-service eateries are working to make the most of in-app payments, which provide a level of data and interaction that cards and cash can't match.
LevelUp, the Boston-based mobile payments and loyalty specialist that won a $50 million investment stake late last year from JPMorgan Chase & Co.—and supports Chase Pay—is maneuvering itself to help other national quick-service restaurants boost business through customized apps featuring in-store and order-ahead loyalty programs and targeted promotions.
LevelUp this month hired Theresa Dold in the new role of vice president of agency strategy to head the company’s focus on restaurant engagement at LevelUp Agency, an in-house marketing unit the company launched in 2013.
Dold previously was director of product at sweetgreen, a fast-casual salad chain that has worked closely with LevelUp and emphasizes mobile payments so much that last fall it stopped accepting cash payments at some of its stores.
Sweetgreen was LevelUp’s first client for a white-label mobile payment-and-loyalty application, and Dold was closely involved in the implementation, particularly in using the data captured by mobile payments to customize the restaurant's marketing programs.
“LevelUp enables a restaurant to do powerful market segmentation to reach the right person at the right time with the right offer by using customer data at the transactional and individual profile level, creating highly personalized offers,” Dold said.
Merchants participating with LevelUp can access the data to brainstorm ideas, or tap LevelUp Agency personnel for help in shaping campaigns, she said.
“LevelUp can point out which customers use the app to buy a particular salad, so we know when to market a similar salad to them. And we can also see when a customer hasn’t come in for a while, signaling that it’s time to re-engage that person with an offer,” Dold said.
The combination of strategic loyalty marketing programs plus seamless payments for ordering ahead has been a breakthrough for many restaurants using LevelUp, according to Dold. Tropical Smoothie Café and Potbelly Sandwich Shop, which just launched with LevelUp, have experienced sales surges from the combination, she said.
Giving customers the ability to order ahead is expanding restaurants' revenue, especially for operations with high-volume sales at lunch, Dold said. “Customers in a hurry who have many choices for where to go at lunch are going to pick the one that executes a fast order best.”
One driver is the momentum around order-ahead with mobile payment, which is now becoming a key competitive advantage in restaurants with fast-casual dining. Panera, which now drives 26% of its sales through digital channels, is on track to top $1 billion in digital sales this year, the company said last week.
At restaurants participating with LevelUp, customers can pay within the app by linking a credit or debit card, and there’s also an option to preload funds to the app and pay as you go, she said.
Chase Pay is available as an payment option within LevelUp apps, though the rollout is still in its early stages, said Alex Shuck, LevelUp’s director of marketing and analytics.
Chase credit and debit card customers may use Chase Pay within the app of a participating LevelUp restaurant, or they can search for a restaurant that supports LevelUp—including the order-ahead feature—within the app, Shuck said.
Most customers at restaurants using LevelUp pay through the QR code-based app, which cashiers scan at the point of sale to accept payment.
Several years ago LevelUp enabled Near Field Communication and Bluetooth in its scanners to “future-proof” them in case contactless payment caught on broadly, Shuck said, but those technologies aren’t generating much demand.
“We haven’t seen many of our restaurant clients ask to enable NFC or Bluetooth recently,” he said.