Dive Brief:
- Kura Sushi updated its Kura Sushi Rewards mobile app, replacing its legacy point-based program with a three-tier membership structure, the company said in a press release.
- Outside of the new tiers, the chain also updated its legacy welcome offer of 300 bonus points, replacing it with an instant free soft drink reward for new member signups.
- The reward structure could improve traffic and sales as the chain works toward improving margins and returning to its historical 20% restaurant-level operating margins.
Dive Insight:
Expanding membership rewards could also help boost Kura Sushi’s average checks, which are growing faster among members versus non-members, executives said during a July earnings call discussing fiscal third quarter.
Across all tiers, members can redeem a $5 reward or free side for 500 points, and free select noodles for 1,000 points. Customers earn points on dine-in purchases and orders placed in the app or online, with the amount of points earned ranging from 10 to 12 depending on the tier, according to the chain’s website.
Under its legacy program, customers received 10 points for every $1 spent at the restaurant or ordering online and automatically received a $5 reward at 500 points and a free birthday dessert, according to a previous version of the rewards website captured by Wayback Machine.
Kura Sushi Rewards
“We reshaped our rewards program with the main intention of putting the power of choice in our guests' hands,” said Charlie Nguyen, digital marketing and strategy manager at Kura Sushi USA in the press release. "By introducing dynamic, competitive tiers and giving members total flexibility over their points, we're delivering real value based directly on what our superfans told us they wanted, while adding an elevated aesthetic to the interface that makes navigation more enjoyable."
The chain has faced significant impacts from tariffs that have increased costs. During the fiscal third quarter, costs of goods sold as a percentage of sales was 200 basis points higher than last year, Hajime Uba, president and CEO of Kura Sushi, said in an earnings release. He added that operational discipline helped offset much of this impact and improved restaurant-level margins by 90 basis points compared to the prior year.
Several restaurant chains, including Charleys, Panera Bread and Tropical Smoothie Cafe, have updated their points-based rewards programs to include tiers, rewards for experiences or other elements to increase customer engagement.
