Punchh has been a member of the PAR family for about a month now, but there are still a few things we don’t know about the industry-leading loyalty and engagement platform.
Punchh has been a member of the PAR family for about a month now, but there are still a few things we don’t know about the industry-leading loyalty and engagement platform. Since its founding in 2010, the company has grown from humble beginnings into a technological powerhouse with employees in the U.S., Canada, and India.
Our team sat down for a coffee chat with Punchh CEO Shyam Rao and CPTO Raju Malhotra to learn more about the platform, how it got its start, and what the future of loyalty looks like for customers and concepts alike.
Punchh Got Its Start by Trying to Solve a Common Problem
When Punchh first launched its product in 2010, the company had a simple concept. When customers were presented with their checks, they were asked how their meal was and shown a smiley face and a frowny face.
“For folks who clicked on the smiley face, we asked for their email address. The conversion for that was through the roof, like over 95%,” CEO Shyam Rao said. “Our ‘aha moment’ was realizing that the thing that works for restaurant marketing is word of mouth. If you have a good meal, you tell your friends about it. But to drive word of mouth, you need to know who your customers are.”
Rao and the Punchh team quickly realized that restaurant brands were blindly creating marketing campaigns and loyalty programs without knowing who their target audiences were. This opened the door for the company to introduce a unique product offering that brought the customer and the restaurant closer together.
“I think the core vision is to help retailers build personal, lasting, profitable relationships with their customers,” Rao explained. “When I was growing up in Toronto, I used to be a part of the hockey team. My favorite memory was going to Pizza Hut on a Friday after practice. It was so much fun. To be a part of that brand’s resurgent success and helping them build even better relationships with their customers is meaningful.”
Today, Punchh is in a prime position to disrupt the market, designing solutions that help concepts across the restaurant, convenience store, and grocery spaces connect with customers on a level that hasn’t necessarily been possible before.
“Engaging with consumers in-store and online and having that omnichannel view is so powerful, but so underserved,” Punchh CPTO Raju Malhotra said. “This is the journey that Punchh has been on for many years, in making that experience really work. That’s a product and technology challenge; it’s just an overall fantastic business opportunity.”
This journey has helped the fast-growing company quickly expand in the industry, serving more than 1/3 of the top 100 global restaurant brands, and hosting a network of about 175 million consumers on the platform.
Loyalty is Becoming an Omni-Channel Product
Like most technology, the more information available to a company, the better the product is for the end user. Punchh took this idea to heart, developing its loyalty and engagement platform to create memorable experiences for customers wherever they are.
“There are companies that provide online engagement for consumers, and there are companies that provide in-store or offline engagement,” Malhotra said. “There are very few companies that can actually strive to provide that true omnichannel experience across the in-store and online experience. That’s where I think our true opportunity as PAR and Punchh is; omnichannel, real-time, and personalized customer experiences rooted in loyalty and industry-specific workflows.”
The omnichannel approach is about more than providing guests with a seamless experience every time they enjoy a bite to eat at their favorite places. Malhotra believes the approach is just as much about developing the strategies that allow restaurants to provide continued value to their guests.
“We can see different types of marketing, coupons, and check-ins,” Malhotra said. “This data is coming in from Brink. The power is that it is tied to a consumer, it has the data taxonomy cleaned up coming in from the POS, and [customers] can use it for other actions like personalization or offer management– even segmentation.”
Using an omnichannel approach, concepts can employ customer data gleaned from in-store and online orders to build and curate campaigns to create better customer experiences.
“This is the richness of the omnichannel profile that is available for the analytics, personalization, segmentation, and engagement,” Malhotra explained. “There is nothing more powerful than having consumer information at this level. It is the foundation for machine learning, it is the foundation for reporting, and the foundation for personalization.”
The data collected by Punchh is also capable of giving concepts unique insight into what promotions and offers might appeal to guests. Backed by more than 120 terabytes of data, Malhotra quickly pointed out that these recommendations are far better than the scattershot offers restaurants used to present years ago.
By activating the right types of customer data at the right time, restaurant concepts are more capable of building and maintaining the 1-to-1 connections their guests increasingly demand.
Loyalty Platforms and POS Solutions Are Symbiotic but Will Evolve
When PAR originally acquired Punchh, the company called itself a unified commerce cloud platform for enterprise restaurants. In layman’s terms, what this means is that concepts can now use PAR products to see every inch of their restaurant. This starts with their guests and moves into payment processing, menu and transaction information, and kitchen operations and labor data.
But what do the restaurants of today need to do to evolve and become the restaurants of tomorrow? We’ve said before that the days of the traditional point of sale are dead, and restaurants are looking for truly seamless ways to remove the many barriers currently separating them from their guests. According to Shyam Rao, the next step is to continue making things easier for the end user.
“When we think about loyalty, it’s about more than just a points-based program,” Rao explained. “It’s about the journey. You think about a customer who comes in and pays cash or uses their credit card for the first time. How do you get them to engage and ultimately nurture them up the value chain? That journey, I think no one has done well, but we have the opportunity to disrupt that.”
But making the customer journey seamless and smooth requires several pieces of technology, including the point of sale, to work in concert to avoid pitfalls and issues that get in the way of the experience.
“Our thesis is that the most natural platform is actually the point of sale, and when you combine the consumer layer with the transaction layer, it will be an unstoppable combination,” Rao said. “We’re sold on the strategic vision, and we feel good that we can execute together. I think there’s something truly transformation we can do together and disrupt the whole thing.”
As the restaurant industry learns to make good use of the massive amounts of data at its disposal, the hope is that everyone in the ecosystem benefits, from the restaurant operators and staff down to the individual customers those concepts are trying to turn into raving fans.
“Together, how do we accelerate not having a point of sale?” Rao asked. “The point isn’t to kill it; the point is to evolve it. How do we become the vanguards of that new reality?”
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