Why Did We Make The Changes We Did To Our Mug Club Loyalty Program?

Posted by · Iron Hill | Posted ·

Why Did We Make The Changes We Did To Our Mug Club Loyalty Program?

Hello King of the Hill Rewards Club members and Iron Hill customers,

 (Mug Club members are now King of the Hill Rewards Club members),

We have rolled out our new King of the Hill program and we are very excited about the changes.

I received dozens of emails with thank you’s as well as questions about the new club. So, I thought I would explain the thought process behind the changes, which should hopefully help answer many of your questions.

But first let me thank all of the people who worked hard to make the new club possible. We put together a team that met every week to brainstorm ideas to solve our issues and make the club better. We also spent time asking our current club members and customers what they would value in a new club. To everyone we surveyed and spoke with, we thank you in helping us make our club your club.

Why did we change the club in the first place?

The Pennsylvania Liquor Control Board (PLCB) told us our Mug Club was illegal because they felt it enticed customers to drink alcohol. In particular, they found two club benefits to be prohibitive:

1. They ruled it was enticement to award points for the purchase of alcohol. To site, “the offering of points for purchases is problematic when points are accumulated based on the purchase of beer/alcohol, regardless of whether the points are ultimately redeemed for food and non-alcoholic products only.”

2.  They deemed it an enticement to offer a club member a mug of beer for the same price as a pint (24 oz mug vs 16 oz pint). Citing their ruling “the Board’s regulations prohibits the sale and/or serving of an increased volume of one (1) drink of liquor, wine or malt or brewed beverages without a corresponding and proportionate increase in the price for the drink.”

Once this happened, we had little choice but to change the club and bring it into compliance.

How did you come up with the new points system?

We spent a great deal of time and effort to try to make the new club better while maintaining compliance with the PLCB ruling.

We surveyed club members. We talked to many, many other club members and customers as our team visited the restaurants.  I spoke with more than 100 club members and customers.

Our biggest challenge was to find a way to give rewards to guests that did not include the purchase of alcohol. Rewarding them for each visit (10 points per visit) seemed like a great answer to offset the inability to award points for alcohol purchases. We went back to the PLCB and asked if this was permissible. They ruled that it was.

Next, we did the math. We reviewed past club member transactions to see if the new system would be equal or better than the old system. When we were done, almost every purchase profile that we looked at ended up ahead in points with the new system. We added the monthly frequency component (an additional 25 points per every five visits in a month) to boost the rewards for our most loyal and frequent guests.

Do I need a new card now that the club has changed?

You may exchange your old Mug Club card for a new King of the Hill card at no charge, but it isn’t a requirement. You may also change cards at renewal or any other time. All members will start to automatically accumulate points under the new program starting October 27.

What about the points and rewards that I have already received, will I get to keep them?

Of course.  If your renewal date is after 10/27, you do not have to do anything until your next renewal date.

Who needs to renew right now?

If your renewal date is between May 1st and October 27th you will have 30 days to renew starting 10/27/12. Last day to renew is 11/27/12 before your membership becomes inactive. If your renewal date is after 10/27, you will need to come in to renew at that time.

Why did you choose the name King of the Hill Rewards Club?

We brainstormed a variety of names but we decided on King of the Hill because it was the name of a loyalty program we had many years ago in our flagship store in Newark, Delaware. We still liked the name and felt it worked for the new program. Rest assured it has nothing to do with the animated TV show!

I can choose either taking home the mug or receiving points ?

Yes, that is a new option.  If you don’t want to take home a mug, you can elect to take 25 points when signing up instead. Whether you choose the take-home mug or points at sign up, you can always drink out of the signature club mug when you visit. Please note that the new mugs are now 22 ounces (more on that below).

I like to see my beer, why not a glass mug?

We considered switching to a glass mug instead of a ceramic one. We researched a variety of glass mugs but after surveying our members, we found that an overwhelming majority of our members still preferred a ceramic mug over a glass mug. 

Okay, but can I still drink out of a glass mug?

Absolutely. You can drink out of the 22 oz Frankfurt mug.

The PLCB ruling forced us to offer an identical portion of beer to members as well as non-members at the same price (but not necessarily in the same serving container). We could not find a comparable 24 oz glass mug that met our standards. So, we decided to use our large 22 oz Frankfurt glass. It is a great alternative for those folks who wanted to drink out of a glass mug and allowed us to comply with the PLCB laws.

Why did Delaware and New Jersey have to change because of a Pennsylvania ruling?

We explored having different rewards programs but couldn’t make it work based on our global POS system as well as some other factors. This component was the key factor to going to one club. A more in-depth explanation is available.

I want to get a companion card, can I get one now?

Yes. Based on guest feedback, we added this great benefit.  If you like, you can turn in your old mug club card and get two new King of the Hill Rewards Club cards with the same account number. You will keep any points and/or rewards that you have, but you will have to resubmit your profile history online. The cost of the companion card is an additional $5 per member. Both cardholders can use their cards on the same day in different restaurants.

Please continue to discuss our new rewards club program and any concerns with a manager or email [email protected].


Kevin Finn
Iron Hill Brewery & Restaurant

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