• by Karlene Lukovitz  @KLmarketdaily, October 25, 2013

Dunkin' Donuts will start rolling out a new, fully digitally integrated iteration of its DD Perks Reward loyalty program on Nov. 4 in four markets, and launch the program nationally in early 2014.

The first four markets are Dallas; Orlando, Fla.; Portland, Maine; and Wilkes Barre-Scranton, Pa. 

The new, mobile-friendly program offers a simplified rewards system, with a platform that updates members' rewards balances in real time.

Guests will earn five points for every dollar they spend on qualifying purchases when they pay using an enrolled Dunkin’ Donuts card, either plastic or via the Dunkin’ mobile app. Once members accrue 200 points, they receive a coupon for a free medium beverage of their choice. 

Those using the app, launched in 2012, can instantly redeem rewards, as well as pay for their items, via in-store scanning off a phone screen. The app also enables customers to purchase, store or reload mobile Dunkin’ cards for their smartphones, as they would with a plastic card; purchase and send mobile Dunkin' gift cards via text, email and Facebook Connect; use a GPS-enabled store-locator and directions feature; and access other store-specific information.

The newly integrated loyalty program will enable Dunkin' to transition to a primarily digital messaging and rewards delivery/redemption model, reducing mailed rewards/coupon delivery and plastic card usage. 

Most important, the program, powered by Epsilon and informed with its data, will enable Dunkin' to better leverage transactional and demographic data to deliver more relevant, targeted offers to DD Perks members. Members will receive personalized special offers to earn bonus points for specific food and beverage purchases. (They can also share their beverage reward coupon with friends and family.)

"We can target specific behaviors, and incentivize members to try new Dunkin' offerings that are likely of interest to them," John Costello, Dunkin’ Brands president, global marketing and innovation, tells Marketing Daily.

The new DD Perks Rewards program incorporates and enhances Dunkin’s DD UpDDate program, which sends members in-store and online offers, previews on new menu items, updates on new restaurant openings, localized offers, and other perks. All DD UpDDate members also receive a free medium beverage on enrollment, plus another free medium beverage on their birthday.

It also provides an easier-to-understand reward points system, a desire expressed by customers in Dunkin's research, according to Costello. (In the past, members who used their prepaid Dunkin' cards received $1 Dunkin' Dollar for every $20 spent on the card in a calendar month, and $2 in rewards for every $20 spent if their cards were auto-recharged at least once a month.) 

During the Association of National Advertisers' Masters of Marketing conference earlier this month, Costello confirmed that Dunkin' is ramping up its CRM as well as loyalty platform, to execute its "mobile-first" strategy. "We are integrating all the screens our guests use," he said.

"The real power of mobile and loyalty is the one-to-one marketing that they can enable,” Dunkin' Brands chairman and CEO Nigel Travis noted to The Wall Street Journal in January. "I believe they will be significant drivers of our growth in the next few years."

At ANA, Costello stressed that Dunkin' has found that "it's easy to get caught up in the hype and technology" of mobile, but the company instead focuses on understanding what its customers really want and the opportunities enabled by data. 

For example, Dunkin's app (which has more than 4 million downloads) was designed to be bilingual, reflecting the fact that Latinos will represent half of Dunkin's growth over the next 10 years. 

Dunkin' has also teamed with Wal-Mart, Best Buy, CVS, Target and Gap on a merchant customer exchange in which the companies will jointly own a payment system and its associated data, reported AdExchanger.