More restaurants trying subscription programs
Consumers are willing to pay monthly subscription fees for streaming services, pet food and even toilet paper. And now some restaurants are betting they’ll do the same for their favorite meals.
Large chains like Panera and P.F. Chang’s as well as neighborhood hangouts are increasingly experimenting with the subscription model as a way to ensure steady revenue and customer visits. Some offer unlimited drinks or free delivery for a monthly fee; others will bring out your favorite appetizer each time you visit.
They’re following a trend: The average American juggled 6.7 subscriptions in 2022, up from 4.2 in 2019, according to Rocket Money, a personal finance app.
“This is just another way for customers to provide a level of support and joy and love for our offerings,” said Matt Baker, the chef at Gravitas, a Michelinstarred restaurant in Washington.
For $130 per month, Gravitas Supper Club subscribers get a three-course takeout meal for two. Baker said Gravitas shifted to takeout during the pandemic but saw demand fizzle once its dining room reopened. The Supper Club — which serves about 60 diners per month — keeps that revenue flowing.
The upscale Chinese chain P.F. Chang’s also saw an opportunity to increase to-go orders with its subscription plan, which launched in September. For $6.99 per month, members get free delivery, among other perks.
Other restaurants are experimenting with memberships, which let diners prepay toward their visits.
El Lopo, a San Francisco bar, has 26 members in its Take-Care-Of-Me Club. They pay either $89 per month for $100 in dining credits or $175 per month for $200 in credits. When members come in, El Lopo starts bringing out their favorite dishes. Each visit, they can gift a free drink to anyone in the bar.
El Lopo owner Daniel Azarkman started the club in March 2021 to encourage patrons to return as the pandemic eased. Now, he’s hearing from restaurants all over the country who are interested in starting similar programs.
“What it really achieves is getting them in more often,” he said.
Rick Camac, executive director of Industry Relations at the Institute of Culinary Education, said he expects many more restaurants to offer subscriptions in the coming years. Consumers are accustomed to them, he said, and the regular monthly income helps restaurants manage their cash flow.
But not all subscription programs have had success. In 2021, On the Border Mexican Grill introduced its Queso Club, which offered free cheese dip for a year for $1. The program stopped taking new subscribers a year later.
Edithann Ramey, On the Border’s chief marketing officer, said more than 150,000 people signed up for the Queso Club, and members visited seven times more often than the average guest. But the Dallas-based chain wasn’t making enough to cover the cost of the dip.
On the Border is now retooling the program and expects to reintroduce it later this year. It may charge more or move to a monthly model, Ramey said, but the subscription element will remain.
“It’s becoming kind of a hot trend and we want to stay as a leading brand,” Ramey said.
Taco Bell is also tinkering with its $10 Taco Lover’s Pass, which lets subscribers get a taco every day for a month. The pass was introduced in January 2022 and again in October; it generated buzz, but the chain is trying to think of ways to make it more valuable to consumers, said Dane Mathews, Taco Bell’s chief digital officer. A subscription could promise faster service, for example, or unlock unique menu items.