Dive Brief:
- TGI Fridays updated its rewards program, according to a press release published Thursday. The update went live sometime between April 28 and May 5, according to archived versions of the company’s website.
- The update combines several loyalty tiers, making some items more expensive and some cheaper to redeem compared to a version of the rewards website from December. The changes did not impact the points accumulation scheme, which remains one rewards point per one dollar spent.
- As inflating menu prices have increased the effective discounts offered by points based programs, many chains are shifting their redemption schemes to prevent over discounting.
Dive Insight:
TGI Fridays now offers two rewards redemption categories: appetizers, kid’s meals, nonalcoholic beverages, or desserts can be redeemed for 75 points, while any entree can be redeemed for 150 points. As the chart below shows, this raises the effective price of several categories of items.
TGI Fridays loyalty points changes
The change reduced the number of redemption tiers from seven to two. TGI Fridays said in the press release that the redemption tiers offered sufficient customer choice. In an email to Restaurant Dive, TGI Fridays said guests found the previous rewards tiers confusing, and said that a number of popular dishes decreased in points price.
The chain also claims the program is easy to sign up for, and that customers can link their phone numbers to a rewards account without a sign-up process or downloading an app.
The new program offers some daily promotions, “including either free chips & salsa or $3 off any appetizer, once per day, every day,” according to the press release.
To promote adoption of the new program, TGI Fridays will give 150 bonus points to customers who make a purchase of $25 or more between May 12 and June 12.
Other chains have revised their points redemption plans recently. Dunkin’ reduced its discounts rates for most drinks in the fall. Chick-fil-A recently raised the points cost of some items. Starbucks, in February, doubled the minimum number of stars required to redeem a coffee or bakery item, but lowered the cost to redeem packaged coffee. Such changes are usually framed as a way to improve consumer choice, but the increase in points cost for common items indicates companies are concerned about reducing discount rates. Lowering a handful of items’ cost to redeem may also push consumers towards those items.
