Main content begins
September 2012

Loyalty Innovation in Retail, International

The Initiative

SUBWAY was brought to New Zealand in 1995, into the tough and highly competitive quick-service restaurant (QSR) industry. Competitors include brands with larger marketing budgets. SUBWAY needed a cost- effective way to stay competitive, and decided to launch a smartphone ordering app to minimize store waiting lines, and drive maximum customer traffic through at popular lunch periods.

In 2006, SUBWAY debuted SUBCARD, New Zealand’s first QSR loyalty program, which provides such SUBWAY customer benefits as Rewards Dollars on purchases. In 2010, SUBWAY pushed innovation further and became the first New Zealand QSR and the first SUBWAY market globally to launch an iPhone ordering app. In 2011 the app was upgraded to make SUBCARD the first loyalty program in New Zealand to go mobile customers were able to use their smartphones as an alternative to loyalty cards to participate in the program.

The mobile app redesign turned it into a total customer solution for engaging with the loyalty program. Updates included gift and rewards balance look-up, storing a customer’s favorite and most recent orders, automatic menu and promotion updates, and nearest store locator. The app also functions as a digital wallet–customers are able to swipe and purchase with pre-loaded or earned credit. Discount coupons are also sent directly to the app.

The key business objectives included: delivering a leading loyalty customer experience, being the first to market with the smartphone app, and increasing the value and volume of mobile orders.

The Results

Because of its “first” status, SUBCARD’s loyalty app won media attention in the national press. An activated SUBCARD holder visits a SUBWAY restaurant 2.5 times more frequently than a non-cardholder and spends 10% more per visit. The value of orders put through the app increased by more than 100% in the first six months of launch, and the volume of orders was up by 90% during the same period. The “Mobile Store” is now SUBWAY’s largest store by value, generating increased revenue while reducing queues and increasing customer satisfaction.

Voice of the Voters:

  • "Their holistic thinking shows that they understand that they need to get customers loyalty to the brand, not just the loyalty program itself."

  • "Outstanding adaptation of an emerging platform to create real business results."

  • "Subway exemplifies a culture of innovation translating into loyalty leaps in their market. Congratulations to Subway for leading the way for other loyalty marketers."

COLLOQUY Interview with Subway