Dive Brief:

• Xperience Restaurant Group has added a loyalty program across three of the chain’s Mexican brands: El Torito, Chevys and Acapulco. The company has been planning to launch a loyalty program since before the COVID-19 pandemic, CEO Randy Sharpe said. 
• The loyalty program will be available at 57 of XRG’s locations, Sharpe said.
• XRG’s loyalty offering joins a crowded field of restaurant rewards programs, but Sharpe said the XRG program’s main point of differentiation is the speed at which guests can earn rewards. A family of four can typically accrue enough points for a free appetizer in a single visit.

Dive Insight:

Though the loyalty program debuted just last month, customer response has been encouraging, Sharpe said. About 40,000 people signed up in the first week and a half of the loyalty program’s existence.

“Obviously, it is going to drive sales, it's going to drive repeat guests, but it's going to just really help us connect better with [our] regulars,” Sharpe said. Those regulars — some of whom have patronized El Torito since it opened in the mid-1950s, according the Sharpe — are the backbone of the business. 

Customers at El Torito, Chevys and Acapulco can receive free guacamole just for signing up for XRG’s rewards offering. Customer accrue 10 points per dollar spent, with rewards escalating for every 500 points earned. The offering worth the fewest points is a queso order, worth 500 points, while an appetizer is worth 1,500 points.

“If you're going to do a loyalty program, it really truly has to be one that rewards, and rewards pretty quickly,” Sharpe said.

While designing the program, XRG surveyed customers and workers to ensure the offering included popular features, and to minimize any potential operational disruptions resulting from its implementation. The program is available directly through its website, and customers can sign up by scanning a QR code at their tables. Paytronix, a company that builds loyalty programs and helps restaurants integrate digital technologies into their operations, powers the program.

XRG wanted to launch loyalty programs as part of its rebranding and growth strategy after it formed in 2018, when Z Capital purchased and rebranded chains formerly operated by Real Mex Restaurants through a court supervised bankruptcy auction. The pandemic derailed those plans. 

But the company has recovered rapidly from the COVID-19 crisis, Sharpe said, and 2021 was its best sales year so far. On-premise sales reached pre-pandemic levels in 2021, he said, while off-premise sales make up about 15% of XRG’s sales. At the three brands offering the loyalty program, average unit volumes hover around $4 million, Sharpe said. 

Loyalty offerings have become a point of competition in recent years, with especially wide adoption among Mexican branded restaurants, from QSR chains to full-service brands. On The Border, another Mexican casual brand, launched a new loyalty app in January as part of its ongoing rebrand. Qdoba, which also works with Paytronix, revamped its loyalty system to offer a two-tiered scheme for accruing rewards in February. Chipotle’s loyalty program, which had more than 23 million members last year, remains something of a gold standard in the industry. Del Taco, meanwhile, partnered with Cheetah Digital to roll out its loyalty app in September.