Recently, a list of the top McDonald’s loyalty point holders was analyzed on social media. The leader of the pack was an individual with 1,370,044 loyalty points—enough for 913 vanilla cones, 456 medium fries or 228 Big Macs.
While an impressive feat to be sure, this breakdown underscores a critical gap in most loyalty programs—a lack of personalization. Every customer accumulates points toward the same set of rewards regardless of individual preferences—a customer who loves McDonald’s coffee and another who prefers their fries are both navigating the same rewards pathway.
To enhance a restaurant loyalty program, rewards should be tailored to customers’ dining preferences, dietary restrictions, location and behavior. This could include seasonal recommendations catered to individual tastes, options for voting on new items, family-friendly rewards, “surprise and delight” rewards based on order history and incentives for social media engagement, ensuring a personalized and engaging dining experience.
If loyalty points aren’t being redeemed, incremental purchases aren’t being driven, and ultimately, loyalty programs become a cost center for brands—in the case of McDonald’s, it offers a huge number of rewards redemption options, but customers are still out there with thousands of unused points. In reality, consumers respond better to confidence in the choices presented to them over a bouquet of rewards all valued equally by the restaurant.
In today’s ultra-competitive market, where every quick-service restaurant seems to have its loyalty program, customers are increasingly scrutinizing the effectiveness and value delivered by these programs. Many, in response to economic pressures, are scaling back benefits or requiring more points for redemption, leading to customer dissatisfaction. This highlights a crucial moment for brands to rethink loyalty—not as a cost-cutting measure but as a strategic tool for deepening customer relationships. If restaurants control the rewards provided through their programs, they’re able to accurately predict the cost to the business while increasing the likelihood that points get redeemed.
Personalization stands out as a key differentiator, and with only 22% of customers satisfied with the level of personalization they receive, there’s vast room for improvement. Leveraging AI for predictive analytics and real-time feedback can transform loyalty programs into a tailored, meaningful experience for each customer. On the brand side, focusing on personalization can help lower the costs of offering rewards while increasing redemption rates—in fact, research shows the reward claim rate for personalized rewards, optimized over the customer’s unique order history, is 3.5 times as high as one-size-fits-all rewards. Collecting first-party customer data is invaluable, especially with the eventual phasing out of cookies; an effective loyalty and CRM solution is well-positioned to gather this intel.
Instead of the one-size-fits-all approach, where each item costs the same number of points but varies greatly in personal value, McDonald’s could ensure that each point holder gets rewards that resonate with their unique preferences, whether that’s fries, burgers or something else entirely. It’s a win-win, not only optimizing the perceived value of rewards for the customer but also maintaining low redemption costs for McDonald’s. Customers would see their points as a tangible pathway to getting more of what they love rather than a generic currency.
Loyalty programs are not just about rewarding transactions; they’re about rewarding trust, deepening the customer relationship and making every interaction count. By closing the gap between perceived and actual value, brands can transform their loyalty programs from a cookie-cutter model to a dynamic, customer-centric engine driving repeat business.
