Should Your Restaurant Use a Subscription Model?

The idea of a restaurant subscription model might sound a bit unusual, but it’s something that’s been talked about and even tried!

As a restaurant owner, you’re likely always thinking about how to bring in more regular customers and create a steady income.

I’ve been learning about business models for over a decade, constantly listening to marketing podcasts and reading up on what makes a restaurant profitable. Let’s dive into whether a subscription model could work for your business.

I first heard about a restaurant subscription model on the “Magnetic Marketing” podcast, where they discussed how to get consistent income in all sorts of businesses, even those that traditionally don’t use subscriptions.

The idea is simple: customers pay a regular fee (like monthly) and in return, they receive special benefits, usually in the form of food or discounts. It’s a way to “lock in” customers and encourage them to choose your restaurant regularly.

The podcast shared a fantastic example of a pizzeria in Winnipeg, Canada, called Diana’s Gourmet Pizza. The owner, Diana, created a “Rewards Program & Gourmet Pizza of the Month”

Here’s how her program worked:

This was a brilliant local marketing idea! Imagine you’re at home craving pizza. If you’ve got certificates from Diana’s, you’re not going to be thinking about other pizza places – you’re going to use your certificates! It creates a strong loyalty loop.

According to entrepeneur.com, it was an amazing business:

“Diana Coutu of Diana’s Gourmet Pizzeria in Winnipeg doubled her business’ sales and size last year selling pizzas priced from $22 to $38, thanks to innovations not at all common to pizza places, including levels of membership with fees automatically charged to customers’ credit cards every month (stabilizing income and locking in use in advance, thus protecting customers from competitors’ seductions); multiple ways to take home the products–cooked and ready to eat, frozen and ready to heat, “from scratch” baking kits (for family fun nights), raw dough–and with comprehensive direct-to-customers marketing built around a newsletter and website.”

Naturally, after hearing such a great example, I went down a rabbit hole trying to find more about Diana’s Gourmet Pizza. Unfortunately, I discovered that Diana’s Gourmet Pizza closed down over a decade ago.

My immediate thought was, “Did the subscription business model fail?” It was supposed to be successful.

After more digging, I found the reason for its closure: it was due to a divorce, not a failure of the business model itself. While this suggests the subscription model wasn’t the cause of the closure, it doesn’t fully confirm its long-term success.

This led me on a quest to find restaurants currently using a food subscription model successfully.

All the information I was able to find was from articles like this: Arby’s+? More restaurants try subscription programs to keep eaters coming back, this Restaurant Subscriptions: How it Works & How to Create Your Own or this Restaurant Subscriptions: Best Examples & How to Get Started. So I checked the official website of all the restaurants mentioned in these and other articles.

To my surprise, most of the restaurants mentioned in those articles don’t seem to offer food subscriptions on their official websites anymore. Some have even closed down since then. It seems that this trend, at least for dine-in food subscriptions, didn’t quite last.

However, there’s a different story when it comes to drink subscriptions! Panera and Pret are two examples of establishments that successfully offer unlimited drink subscriptions.

This makes a lot of sense because people often pop into these places for a coffee or a drink, and while they’re there, they might decide to grab some food too. It’s a clever way to encourage frequent visits.

While Panera’s subscription price isn’t easy to find, Pret’s “Club Pret” offers up to five barista-made drinks a day for $50 USD per month, with a 30-minute wait between redemptions. It also includes 20% off breakfast or bakery items and other perks.

My search for a restaurant that has been successfully using a food subscription model for a long time is still ongoing.

If you know of any restaurants that are doing this successfully, please let me know at info@koalawidgets.com! I’d love to investigate further and share more insights with you.

In the meantime, I hope the information about drink subscriptions has given you some useful ideas to consider for your own restaurant!