Leaders in Customer Loyalty, Powered by Loyalty360
Leaders in Customer Loyalty, Powered by Loyalty360
Teriyaki Madness: Leveraging Technology To Create an Enhanced Customer Experience
Teriyaki Madness is the result of a mad passion for teriyaki that came to life for brothers Rod and Alan Arreola, and their cousin, Eric Garma, while living in Seattle, WA. As the three fine-tuned their appetite for Asian cuisine, working in mom-and-pop shops during college, a vision was born: introduced Seattle-inspired teriyaki rice bowls to the rest of the world.
By 2003, the first fast-casual Teriyaki Madness restaurant was opened in Las Vegas, NV. The company began to offer franchising opportunities in 2005. Now with more than 130 locations, Teriyaki Madness can be found in over 30 states and in Mexico and Canada. In recent years, the company has seen marked growth. Teriyaki Madness opened 10 new restaurants and awarded 45 units in 2023, and the company has observed a 21% year-over-year systemwide sales increase.
Mark Johnson, CEO of Loyalty360, spoke with Jodi Boyce, CMO of Teriyaki Madness, about the Mad Rewards program, the integration of new technologies into its app, and meeting evolving customer expectations.
Good afternoon and good morning.
Speaker 1:This is Mark Johnson from Loyalty 360. I hope everyone's happy, safe and well. I want to welcome you back to another edition of our Leaders in Customer Loyalty series. In this series, we speak with leading brands about what they are seeing and hearing on the front lines of customer channel and brand loyalty. Today we have the pleasure of speaking with Jody Boyce. She is a chief marketing officer at. Terri Aki Madness. Thank you for taking the time to talk with us today, Jody.
Speaker 2:Thanks for having me.
Speaker 1:First off, we'd like to start these on a more personal level, get to know those who are speaking with Reba themselves, maybe their past job roles, everything you do at Terri Aki Madness, and maybe a fun fact about yourself, a passion you may have outside of work.
Speaker 2:Perfect. Yeah, I've been in the restaurant and franchising industry for 20 plus years 25 years. I grew up in California, I went to school here at CU in Boulder in Colorado and then my first job out of college was driving the Oscar Meyer Wienerovia all around the country. So tons of fun, kind of launched my career into the food industry, being a craft and Oscar Meyer. So I've been with lots of brands, all in fast, casual, a couple casual dining dining but Quiznos and, way back when they were in the height of their growth, smash Burger, einstein Brothers, bagels Village in Baker Square. So I came to Terri Aki Madness about seven years ago and it had everything I was looking for. I hope that this is my last stop for a very long time, because it's a great brand, it's fun. We are growing like crazy and we have 134 shops open as of today because we just opened two more. So it's been fun.
Speaker 1:Can you provide a brief overview and history of the Mad Awards program? How does the program work, how do members engage with it and what are the benefits of being a member in the program?
Speaker 2:Sure. So we launched our app in 2018, but we didn't launch the loyalty piece of it until 2019. It was just such a big shift for our system that we broke it up into two pieces. We started and when I started here, we only had 12,000 people in our email database, and since we've launched our loyalty program we've grown that to 570,000. And so those are very active people that want to hear from us. So it's a really captive audience.
Speaker 2:We went with a very simple point based system where you earn points for every dollar you spend and it just varies by catering versus our regular menu. But we kept it pretty simple Earn points, use them right away for free stuff or save up for something bigger. And as far as how our customers engage, they can, like I said, earn points for free food. They can participate in point promotions that we run. We do a lot of things around holidays or 4th of July or coming up Labor Day where we're going to push a double or triple point offer to get people in, or they can do a refer a friend program and earn their 5 off 20 that way. So benefits to us are learning customer behaviors. We're tracking all of this journey on these customers as they're ordering, as they're in our loyalty program, so we're able to talk to people in different ways, whether they haven't been in in 60 or 90 days, or whether they come every Friday and get the exact same bowl. So that's a huge piece for us.
Speaker 2:The other big benefit is now that we've been doing this for, you know, four plus years or longer than that, I guess, four or five years we have the data to show that our loyalty guests are spending 8 to 12% more than our non-loyalty guests, and to me, that's the whole intent of having a loyalty program is to get guests to spend more and come in more often, and so we've been able to prove that the industry has been fluctuating so much with that spend lift. I think the industry right now is something like 1 to 2%. Loyalty guests are spending more than non-loyalty guests. We're still hovering around that 8%, so that number has has dropped over the last couple of years, but we're still still, you know, one of the higher ones in the industry, which is great.
Speaker 2:And then I guess the last piece on that is it's not a huge discount program for us. We use it so that customers have to earn whatever it is that they're going to get. I always tell our franchisees we don't want to be like Bed, bath and Beyond. We don't want customers just sitting and waiting for the next offer. I think you would probably agree you would never shop there without a coupon. So we want our customers to earn it and then reward them essentially for being oil.
Speaker 1:As you briefly discussed, you've seen significant growth. Terri Aki man has opened 10 new restaurants and awarded 45 new units this year, and has also seen a 21% year-over-year system-wide sales increase. How are you able to keep the focus on the customer loyalty program and what strategies have you implemented to manage these significant growth numbers at your store? Numbers at your store.
Speaker 2:Really, it's just it's been growing exponentially. So when we open a new shop, we open two more. Today we have a much higher adoption rate from the day the doors open. When we first launched, you know, we had already had several shops open at the time and they've been open for years. We had to go backwards and educate and train and teach those customers who are already coming quite often why they needed our app, why they needed to join our loyalty program and what's kind of nice is that work is.
Speaker 2:I guess we don't have as much work with new shops. We train people from the day the shop opens of the benefits of joining our loyalty program. So we have a much higher adoption rate. So, like I was saying before, it's such a captive audience because you're not, we're not buying a list. These people are opting in, they're downloading it themselves. And so when we send an email or we send any kind of communication, we've sent emails to our you know, 500,000 members to say, hey, fill out the survey, we want to know what new LTO you want, or we want your feedback on something. Or hey, here's new news on a new product. It's not always about offers and we get a pretty immediate lift and response from our database.
Speaker 1:Teriaki Madness also just launched Flyby, which is an integrated new technology into the Teriaki Madness app that allows for advanced delivery pickup curbside opportunities for the customers. Can you tell us a little bit more about the future and how that helps to elevate the customer experience?
Speaker 2:Yeah, I technically were still piloting it. We're going to roll it out either late this year or early next year because it turned into a much bigger project as we were getting into it, but for the better. So for those that don't know, flyby is a piece of technology that essentially uses GPS tracking to track customers when they order for curbside pickup or delivery. It's really precise, so it tells the shop when that customer is two minutes out, when they've arrived, like literally when they're pulling in to the parking lot, and then it's so precise it will tell them where they're parked in the actual parking lot. So the industry is moving towards a lot of drive-thrus and Terracay madness were made to order customizable.
Speaker 2:We're not really built for a drive-thru, we won't have them, and so this is our solution to be actually faster than a drive-thru, because if someone orders for pickup or curbside, they can literally pull up and our goal is to be standing there on the curb holding their food, so they don't even have to park. And so this technology is helping us track them, know when they're arriving so that our crews can get out front and hand them their food. Because convenience is king. That picked up pretty rampantly during COVID and it's not going away. So people still want convenience, for sure.
Speaker 2:And then the delivery piece of it. Flyby is integrated with the delivery partners, and we are already integrated through our app with the delivery partners, so we're actually tracking them as well. Our goals to even run the food out to them in hopes that it eliminates some of the challenges with delivery drivers not wanting to get out of their car and come in and get the food. So it's turned into a pretty big initiative and, I think, pretty unique to most fast casual brands and, yeah, it should be a good one for us.
Speaker 1:And what part has technology played in creating a greater customer experience overall at Teriyaki Madness?
Speaker 2:Yeah, technology is one of those things that's great when it works and it's really frustrating when it doesn't.
Speaker 2:Going back six or seven years when delivery was first starting, we decided to jump in with Bill Fee and work with the delivery partners and work with Olo and Punch and our app and all the delivery partners to be integrated.
Speaker 2:People forget because it works so seamlessly now, but it was probably three years of pain before all the technology kinks were worked out and now it's a pretty well oiled machine. When you go to order on DoorDash it flows directly through Olo and into our system in the shop. The same is true with any technology you have to spend the time to work out the kinks, to find basically try to break it. We've done a couple curbside promotions on purpose in our test shops where we did 50% off a curbside order to try to get as many orders as we could on one day to see if we could break it, to see what we need to fix and address. And yeah, technology is awesome. It actually 95% worked the way it was supposed to, but it allowed us to see what areas could be a weakness that we need to address before we rolled out to 130 locations.
Speaker 1:Loyalty360 has a growing brand community and we meet quite frequently to talk about different topics pertaining to customer loyalty and corporate social responsibility. Csr is one of those important subjects for brands. When you look at Teriopte Madness' fundraising program, percentage of the orders purchased goes to the hosted event during the timeframe for the organization that the franchise supports. How does that program work and what does it mean to your organization's culture and loyalty efforts?
Speaker 2:Fundraise were huge. For us it's such an easy, low-cost, low-effort program. But we're 100% franchised and our franchisees really do want to be part of their communities. They are local business owners with a local brick-and-mortar business in their community, so doing fundraisers is a natural fit for us. We work with any nonprofit Schools are huge right now because everyone's going back to school. But sports teams and church groups and whatever it is any nonprofit, it allows the shop to be giving back to the community. But it also from a marketing standpoint. We know from our own surveys that people love the flavor of our food as the number one reason they come to us. So if we can get food in people's mouths, they kind of get it and they understand what terrackey is, they understand what we are and doing something as simple as a fundraiser not only gives back to the community but we're introducing the brand to so many more people, even if they don't make it to the fundraiser. It's free advertising. Essentially, the school or the program does all the work really.
Speaker 1:You know, another topic that we see a great deal of discussion around is how customers are changing. There was a focus, as you knew, going into COVID how customers are gonna change, how they may change, and then coming out of COVID we see a focus as well, great deal of discussion about how customers are changing, how brands can adapt, how you see your customers changing, or maybe in the industry holistically, and how are you adapting to that change.
Speaker 2:Yeah, well, we look at that all the time because before COVID, our food travels really well. So pre COVID, we were already doing about 50% of food out the door, whether it was pickup delivery or curbside or just takeout, so we were doing about 50, 50. During the pandemic, obviously, everything you know dining rooms were mostly shut down. About 95% of the food was out the door. Now we're doing about 80% out the door, so we're still really high. You know, outside the four walls, about 20% are in dining rooms.
Speaker 2:I'd say the biggest piece that has stuck, though, is that convenience factor. I think, you know, a lot of people were forced to use apps for the first time during COVID. A lot of the you know the older demographic who, like my parents, would never have used an app to order food before, and actually, quite honestly, I hadn't ordered delivery personally for home until the pandemic. So a lot of people were forced to use these apps. They were introduced to these loyalty programs, and so there was huge growth across the whole industry there. But I think the part that was lost during COVID that we're trying to get back now was a guest experience. We basically opened half of our restaurants since 2020. And so all of those franchisees and those employees have never had people in their dining rooms. They weren't trained on. You know, giving the guest experience and so that's a big piece that we're trying to get back to is giving guests the best experience they can, especially with inflation and how much things cost today.
Speaker 1:And what is the next big thing for customer loyalty, customer experience, that Terri Aki Madness is focused on?
Speaker 2:For us it's a bunch of things, but we have every single person in our company right now working on the guest experience and that goes from everything from back of house efficiencies in the kitchen and the systems, and you know we're working with how to get our shops to be more profitable. The whole goal is how do we make the back of house more efficient so that we can shift labor to front of house and give that great customer experience. So we're working with a profit keeper and HubWorks, which is a back-of-house you know inventory management system, and our Mad University, which is a training program, and fly by and all these different pieces. All of them have a technology arm to them. But yeah, the goal for us and our kind of theme for the whole next by a couple years, is guest experience.
Speaker 1:You know, big challenge we've heard discuss a lot recently is the privacy changes. A number of states have privacy regulations and a number of others coming forward which can impact a brand's ability to access data right. How you communicate with customers can be a challenge as well, you know, when you look at some of the privacy rules that are out there how have they impacted your customer loyalty program or efforts that you have to engage with your customers.
Speaker 2:Yeah, I mean we've already made some of the switches. We did an app update, you know, adding in the deletion of, or the option for someone to delete their information. There's lots of opt-in, opt-out buttons that were added. So we've we've been following it as as much as we need to and as much as we can, I think we also, just at Tarak Manus, we keep it pretty simple. You know. We are collecting the data, we're using it to email our, the people who want to hear from us emails and notifications. So, yeah, we're following it, but I also feel like we probably have a simple program.
Speaker 1:Yeah, what are two or three things you're most proud of with your customer loyalty program?
Speaker 2:One is the growth, Just the speed of growth. I remember when we first launched our app and I was watching the sales and I was really excited. I can't remember what it hit, but I was excited when it hit some number. And now I look at that and we do that in like an hour. So the speed at which it's grown and it's really organically.
Speaker 2:You know where we've been a essentially like a startup for the last several years. Now we're kind of in our our teen years, but you know we don't have huge budgets and we're not doing this huge advertising campaign. So it's a lot of organic growth and it's pretty cool to see because it's working the way it was intended, I'd say. The other one for me is integrated systems. We realized several years ago it is more important than almost anything we do to integrate any new partner that we take on. So, as any department in this company is looking at a new system, technology, whatever it is, a requirement to work with us is that you're either already integrated or willing to integrate with the systems that we already have.
Speaker 1:When you look at customer loyalty, we always like to ask brands who run programs, or should say to individuals who run programs are there other brands that you're loyal to, and why so for you? What brands are you loyal to and what do you like about their offerings?
Speaker 2:One that comes to mind, because I use it a little bit too often, is Starbucks.
Speaker 2:So I do like how they send when they have whatever promotion or you know, a little sprint of by four days in a row and you get X amount of points.
Speaker 2:The customer has to opt in to be part of it. And what I've noticed with myself doing that you know it's a I guess a little bit annoying on one side, but the other side that's great is I opted in to do it, so it's a little bit more top of mind, and even though I'm in marketing and I know what this stuff is, I still think about it and like, oh, I better buy my drink today to make sure I get my you know third day and qualify for my points. So I do think that's kind of clever. Although I, as a customer, I'm also frustrated that they not only have raised their prices so much, they've made it really difficult to actually earn that free drink. So I feel like these these little sprints they're doing are necessary, because I'm sure I'm not the only customer who sees that. You know, twice I don't even know how much I'm spending before I get that free drink.
Speaker 1:And the last question I had is what can loyalty 360 do to help you and your team in your customer loyalty efforts?
Speaker 2:I think, keep sharing best practices that other people are doing. You know, we have this, this great database now and we have all this data and we know what our customers are doing. It's a lot and it's overwhelming. And so to see best practices of what others are doing and help us make decisions you know, with other fast casual restaurants or just loyalty in general that really does help us when there's so much out there we can be doing and we just need to prioritize. So sharing best practices is a big one for me.
Speaker 1:Well, jody, thank you very much for taking the time to talk with the state. It was great getting to know you, getting to know a little bit more about Terracia Madness. The passion you share for the customers, for your program, for your product, was very apparent, and looking forward to hearing more from you and your team in the upcoming year. So thank you very much.
Speaker 2:Well, thanks, mark. It was great to talk to you too, and thank you, everyone else, for listening.
Speaker 1:Make sure you join us back for another edition of our Leaders in Customer loyalty series. Until then, have a wonderful day and thank you very much.