During a question and answer session at the end of a March 25 conference call with analysts, Clifford Hudson, CEO of SONIC Restaurants, said the company is considering a loyalty program.

“We are exploring that now and developing that now,” Hudson said during the conference call. “So, as reach the point where we’re ready to roll that out in a public format, we will share that with you. We do think it has a place in our business and we have many very regular customers and so it makes sense to reward them for being so, but also help drive additional traffic which customers might appreciate that as well. Now as to how we would do that, we are working on that and we’re working on it in a quite focused manner. However, that’s not something that we really want to lay out the details of that today. It’ll take a variety of forms over time, but as that evolves and we’re ready to share elements of it, we’ll do that.”

Hans Wybenga, SONIC’s Vice President, Consumer Insights, told Loyalty 360 that the company is in the development and testing phase of implementing a loyalty program. Because of its unique delivery system and friendly carhops, Wybenga said, “SONIC customers are already loyal. We believe we can build upon their love for the brand by ensuring they know we recognize and appreciate their loyalty to SONIC.”

Wybenga believes a loyalty program would deepen SONIC’s relationship with customers, both at the drive-in and away from the drive-in.

“Our loyalty program will allow for greater interaction between SONIC and our loyal customer,” he said. “SONIC is among the most differentiated concepts in quick service so we want our loyalty program to be just as unique.  We want our program to not only reward customer loyalty, but drive incremental visits. We are currently in the development and testing phase.”

Developing a loyalty program is about one thing, Wybenga said.

“It really is all about customer engagement,” Wybenga said. “SONIC, unlike any other national quick service brand, has a unique opportunity to extend our relationship with our customers. We feel this program can deliver a new level of engagement both at the drive-in and away from the drive-in.”

SONIC reported a significant increase in net income to $3.6 million for the second quarter ended Feb. 28, compared with $1.7 million in the same period last year. Second-quarter revenue slipped to $111.1 million, from $115.1 million in the same period last year.

As of Feb. 28, SONIC had 3,526 drive-in units in 43 states.

The Oklahoma City drive-in chain’s shares have jumped 70% since last spring. The company reported second-quarter adjusted earnings of five cents per share on revenue of $111.1 million Monday.

More than 450 new Sonic drive-ins have opened in the past five years. Stephen C. Vaughn, the company’s chief financial officer, told analysts during the call that the chain’s smaller building prototype improves return on investment.

“One of the reasons we expect stronger development over the longer term is the work we've done to improve new store return on investment through a new smaller building design,” Vaughn said, “which reduces non-land costs by 15%-20%. We have opened several of these drive-ins to date, and we expect that this will become the primary layout for new stores in the future.”

The reconfigured restaurants save $150,000 to $200,000 on the construction of a new SONIC drive-in.

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