An authority on sandwiches, nationwide chain Schlotzsky’s is integrating a digital rewards program driven by social sharing and in-app referrals to let customers take the business viral.

Customer referral programs are powerful in motivating existing customers to recruit new business through trust. The launch of the Lotz4Me Guest Rewards mobile app enables users to refer friends and earn rewards when individuals in their network download the app and make a purchase.

“For the first time, we are leveraging our fans as Brand Ambassadors, rewarding both their patronage and advocacy on behalf of our brand,” said a spokesperson for Schlotzsky’s.

“Our guest experience will improve simply by having one unified guest rewards program that is both engaging and rewarding.”

“Since the app also links with our POS system, we can begin to study our guests’ buying behavior to push them offers that will specifically appeal to them. It allows us to have more relevant and rewarding interactions and communication with our guests.”

Since the June 2 launch, the app has ranked as high as No. 4 in the Apple App Store in the Restaurant category, ahead of Papa John’s, Panera, Chipotle and others.

Encouraging adoption
The Lotz4M Guest Rewards app was developed by Punchh, a mobile CRM platform provider based in Silicon Valley, Lotz4Me is designed to utilize social technology that allows guests to get rewards for discussing the Schlotzsky’s brand on Facebook or word of mouth.

Modern society values personalization, customization and self-expression. For brands to remain relevant, they must adequately use the power of their assets and equities to differentiate from competitors.

By having a customized guest rewards app, guests will be entitled to feel like it is their program.

To inspire implementation of the Lotz4Me app, each download will be loaded with a credit for one free small The Original Schlotzsky’s sandwich with purchase of chips and 32oz. drink during the month of June.

For each friend who downloads the app based on Facebook referral, the guest who originated the invite will receive a referral punch once the new user visits a Schlotzsky’s to use the app. Schlotzsky’s aims to giveaway up to a million free sandwiches.

The chain additionally rolled out a “Sandwiches Have Landed” digital campaign to generate  buzz about the program during its launch. Through a series of videos, the adventures of a team of underdogs will be chronicled on YouTube, Facebook and Twitter throughout June as they save the world from the invasion of one million sandwiches headed to earth. The characters will inform audiences how they can save the world from falling sandwiches by downloading the app to take a sandwich out of the sky.

Competitive awareness
Given the competitive nature of the fast-casual industry, apps that are designed to build brand awareness and deepen levels of brand engagement will drive profitable sales.

Indirect rival Starbucks intermittently offers similar discounts to existing app users who successfully persuade friends to join My Starbucks rewards, and greets new users with bonus points, though the promotion is never ongoing.

“Other marketers can learn from this regardless of their industry – whether it be restaurants, retailers, automobile dealers or home sellers – the same fundamental tenets apply.”

One of the best known digital customer referral programs has been implemented by Dropbox, which  rewards both their existing and new customers with additional storage space when a new user signs up for the service. This program had a very low barrier to success, friends just had to sign up for a free account, but it was very effective at propagating the company’s freemium product.

By combining an app-based loyalty program with a social sharing and a referral bonus benefit, Schlotsky’s is driving incremental guest visits by rewarding members with a digital “punch” for each visit while also rewarding their advocacy through both social sharing and referral bonuses.

This allows loyal and engaged guests an easy outlet to share their fandom with friends via the amplification of social media. By putting guests first, at the epicenter of the brand,  and revolving everything around their stated wants, needs and desires, Schlotsky’s is setting an example of how traditional app rewards can be taken even further.

“Today, guests are more in control of both the messaging they wish to engage with and the brands they wish to patronize; therefore we must take a Listen, Learn and Share mentality toward everything we do,” a Schlotzsky’s spokesperson said.

“Listen to your guests; learn what makes them love you and share relevant, motivating and compelling content that enriches their overall brand experience and turns them into not only loyal guests, but indeed advocates for your brand.”

Final Take
Michelle is editorial assistant on Mobile Commerce Daily, New York