Dive Brief:
- Wow Bao and Paytronix announced Thursday the launch of Bao Bucks, a loyalty program that grants customers points on orders placed through Wow Bao's website. Customers earn one point for every dollar spent, and can redeem 100 points for $7 in Bao Bucks at any location.
- The companies claim in a press release that the loyalty program is the first nationwide rewards program offered by a virtual brand. It is available in the U.S. and Canada, and will soon be accessible in the U.K. and Mexico.
- By drawing in new and repeat customers, Wow Bao expects the Bao Bucks program to contribute to revenue for partner restaurants, a spokesperson said.
Dive Insight:
Wow Bao, which offers buns, potstickers and bowls, generates only a small percentage of its total orders directly through its website, a spokesperson said, but the company hopes its loyalty program will increase that proportion over time. Wow Bao also piloted the program at 10 "dark kitchen" locations to test integrations and technology, but did not share the trial's results with Restaurant Dive. Once guests earn Bao Bucks, they have 60 days to put them toward their next order.
Paytronix said some of its other clients are experimenting with loyalty programs and virtual brands as well, but that Wow Bao is the first virtual brand to test a loyalty program at this scale. Customers can sign up for Bao Bucks on Wow Bao's website, or as they complete an online order, a Wow Bao spokesperson said.
Virtual brands have become a lifeline for some independent restaurants as operators seek ways to grow digital sales and diner reach without investing in brick-and-mortar expansion. A recent study from Technomic and Grubhub found as many as 41% independent restaurants are operating virtual brands.
"Together we will enhance the guest experience, increase our volume of repeat orders, and drive more sales to our partners,” Geoff Alexander, president and CEO of Wow Bao, said in a statement.
With more than 600 locations serving Wow Bao's products, the fast casual chain has emerged as a leader among virtual brands. A loyalty program could help secure Wow Bao's customer base by giving it access to valuable customer data, which the company can use to better tailor products and promotions to its diners.
A rewards program could also help the virtual brand secure staying power and differentiate from virtual concepts deployed by major QSR and casual chains that are designed to act as LTOs to boost brand awareness.
