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What is RewardsNetwork's business model? Has it changed?

What is RewardsNetwork's business model? Has it changed?

Old Jun 15, 17, 7:35 am
  #1  
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What is RewardsNetwork's business model? Has it changed?

I seem to remember that RewardsNetwork's business worked by providing a loan to restaurants who sign up, and that the loan is repaid by taking a cut (maybe 20%?) of the total amount of each check paid by a diner who signed up to earn miles on the RN dining programs.

Is that correct? Or does RN take a cut of every check, not just the ones where the diner earns miles?

Have the mechanics of the program changed?

Do all restaurants have a similar sort of deal here or do only the ones which need the money get a loan?

Are the interest rates for the loans different?
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Old Jun 15, 17, 9:46 am
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Originally Posted by salut0 View Post
I seem to remember that RewardsNetwork's business worked by providing a loan to restaurants who sign up, and that the loan is repaid by taking a cut (maybe 20%?) of the total amount of each check paid by a diner who signed up to earn miles on the RN dining programs.

Is that correct? Or does RN take a cut of every check, not just the ones where the diner earns miles?

Have the mechanics of the program changed?

Do all restaurants have a similar sort of deal here or do only the ones which need the money get a loan?

Are the interest rates for the loans different?
The loan is only one of the ways it works. Restaurants can also simply use it as a promotional tool, somewhat similar to paying for coupons.

And even when it's a loan, I seem to recall there were several different varieties of it years ago (when we last discussed this).

IIRC RN only takes a cut of the dines of its customers, not all checks. Keep in mind it would very difficult for RN to account for all checks, if it included cash ones. RN uses technology to intercept credit card transactions at the restaurants terminal, so it can at most only see credit card transactions, not all restaurant checks.
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Old Jun 15, 17, 10:05 am
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Thanks for this information. One more question: what kind of data do the airlines get from the partnership?
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Old Jun 15, 17, 3:55 pm
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Originally Posted by salut0 View Post
Thanks for this information. One more question: what kind of data do the airlines get from the partnership?
I have no idea what data they get, other than obviously they know if we're using the program and how much because each dine posts to the airline separately. The airlines are not in the restaurant industry, so I'm not sure what data RN would have that the airlines would be so interested in.

Rewards Network is a private company. Why do you expect us to know much about its internal operations? Their relationship to restaurants was presumably learned from the side of some restaurants, which is fairly easy if you know someone who runs an RN-participating restaurant. But restaurants are tiny businesses compared to major passenger airlines, and so of course we have no one "inside" at the airlines to tell us what they get from RN, the way individual restaurant owners might occasionally tell someone who posts here what their relationship with RN is/was.

I don't know how accurate or unbiased it is, but if you google "Rewards Network company info", the first thing you get is this wiki page about it:

https://en.wikipedia.org/wiki/Rewards_Network
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