Gamified Customer Experience: Part 1 of Papa Johns’ Successful Growth Strategy
Imagine a loyalty program so engaging that it turns every purchase into a game, every interaction into a challenge, and every reward into a victory. This is exactly what we had in mind when we introduced the latest iteration of the loyalty program with Papa Johns UAE.
We are thrilled to announce the launch of a series of blog posts that will unveil the secrets behind the success of Papa John’s loyalty program. These posts will also reveal what stood behind our recent triumph at the prestigious Loyalty360 awards in the USA, where we outshone renowned brands such as Cracker Barrel, Tim Hortons, Enfamil, and Hilton.
Let’s start from the beginning and understand the background and market situation.
Why we needed to make a real change?
Papa Johns UAE is an international QSR franchise operator with over 80 stores across the UAE. It’s important to note that in developing markets like MENA, aggregators dominate, holding more than 90% of the delivery order market share for the restaurant industry.
Additionally, customers in these markets are heavily focused on discounts, leaving restaurants with little room for profit as they are constantly pressured to lower prices. Furthermore, aggregators have recently started introducing their loyalty programs, presenting an extra challenge to create something truly revolutionary.
We knew that entering into this competitive cycle would be a losing proposition; we needed to rethink our approach completely. Months of market research and analysis drove us to a new idea: an entirely gamified and interactive digital customer experience. It’s an experience driven by engagement—ordering food is simply a by-product of the customer’s relationship with the brand.
You can’t easily move giants like aggregators, right? But you can be DIFFERENT with a TOTALLY DISTINCT APPROACH: transforming your marketing strategy, and with it, your entire customer engagement philosophy. In response to aggregators’ unsustainable business models for businesses, Papa Johns, in collaboration with LoyaltyPlant, set several objectives to achieve:
- Decrease the proportion of orders from aggregators, which accounted for over 90% of the online sales.
- Minimize promotional costs associated with customer acquisition and retention, while reducing dependency on discounts.
- Increase ARPU (average revenue per user) in the last 60 days.
- Maximize the 3-month LTV (lifetime value) of new users.
- Keep loyalty program expenses within 3% of total loyalty revenue.
To achieve these goals, we completely reimagined our approach to loyalty and found a new solution for Papa Johns. We aimed to implement a new technology platform, enabling us to operate with a higher degree of autonomy while cultivating direct customer relationships.
To achieve this, we:
- Launched our own app with integrated loyalty, ordering, and marketing features.
- Started to transfer digital orders to a direct channel.
- Transitioned from discounts to complimentary rewards.
The platform included a rewards-based loyalty and ordering app, a content management system, data analytics tools, and an advanced marketing suite. With the incentives offered by our initial rewards program, the early results were clear: we were rebuilding our brand equity, improving our financial results, and providing a significantly better customer experience.
As a result, we created an entirely gamified and interactive digital customer experience. It’s an experience driven by engagement—ordering food is simply a by-product of the customer’s relationship with the brand.
Pillar 1. A gamification-focused tiered loyalty program, unique to the QSR business in MENA
When Vas, CEO of LoyaltyPlant, met with Karim Chainee, CMO of Papa Johns UAE, at a café to discuss the architectural framework for the entire workflow, they focused on the following main points:
• Simplicity:
Our loyalty program rules should be easy to understand, without lengthy explanations or caveats.
• Gamified UI and UX:
To engage our gaming-oriented audience, we want to integrate gaming mechanics into the app interface, making our loyalty program blend seamlessly with the UI/UX and gaming elements.
• Cost Optimization:
With operational costs increasingly unpredictable in recent years, it is critical that we maintain a flexible cost structure for our loyalty program.
• Emotional Loyalty:
Our focus lies in creating an immersive, emotionally resonant experience that cultivates customer loyalty beyond financial incentives.
Statuses and rewards
The loyalty program consists of four main statuses. Displayed on the main screen of the app, these statuses clearly show how to achieve a new level and include motivational messages to help you maintain your status:
BRONZE STATUS: You receive this status immediately upon downloading the app. You can earn 3,000 points by recommending our app to a friend and access rewards available for Bronze members. To reach the next Silver status, you need to order 60 AED worth of products within 60 days.
SILVER STATUS: This second-level status unlocks new opportunities, such as receiving an exclusive birthday gift and accessing new rewards available at this level. To advance to Gold status, you need to place an additional order of 120 AED within 26 days.
GOLD STATUS: With this advanced status, you earn more points for every 10 AED spent and need to order 39 AED worth of products within 60 days to maintain it. Gold status offers exclusive pizza team merchandise, new rewards, and extra points.
PLATINUM STATUS: The most advanced level, Platinum status, provides perks like participation in exclusive events, access to more valuable menu items, a “VIP Customer” sticker on your pizza box, the ability to donate your Papa Points to charity, and more!
As mentioned earlier, our loyalty strategy significantly reduces reliance on discounts, prioritizing tangible rewards that strengthen our brand connection.
For instance, receiving a $2.5 discount using accumulated points saved over months doesn’t deepen your bond with the brand. However, when your guests receive certain menu items for free from our reward catalog, based on their status level, it creates a completely transformative emotional experience!
And one of the coolest features of the tiers is the tier upgrade animation, just like you’d see in popular online games! It’s that feeling you get, like when you’re playing your favorite game and leveling up—being part of something big.
Pillar 2. We made loyalty program simple at its core
No matter how amazing a product is, if people don’t understand how to use it, it’s all for nothing! That’s why we made sure to design our loyalty program with the simplest and most user-friendly interface from the start.
In the “How to Earn Papa Points” section of the app, you’ll find clear explanations of all the ways to earn more points. The base loyalty earning scheme is easy to understand: simply add a zero to the total amount spent. Depending on your current status, you’ll see simple instructions on what you need to do to reach the next level.
One key feature is the use of green signs on badges, signaling opportunities to earn more points and advance in the game. This visual cue helps users easily identify how they can progress.
Business impact: increase in number of high-paying customers
We conducted a year-over-year analysis of the revenue results for different groups of customers: Medium, High, and Top. Among these three categories, we observed significant growth in average revenue per user (ARPU): an 11.3% increase for the Medium ARPU cohort, a 17.4% increase for the High ARPU cohort, and a remarkable 25.9% increase for the Top ARPU cohort (see the table below).
In the first week, we noticed a slight revenue drop as users across all cohorts went through an adaptation period. However, after a few days, the new loyalty program started to take effect, resulting in a substantial revenue boost.
Are you ready for growth?
Do you want to start a game-changing loyalty program for your restaurant? Regardless of the size of your business, we offer you the chance to experience the best world practices and build real connections and relationships with your audience. This will not only make your guests truly love your brand but also boost your restaurant’s revenue.
If you’re ready to grow, share your contact information here. Our team will conduct a free business analysis of your restaurant and unlock the potential you can achieve by effectively engaging with your most valuable asset—your guests.
