It’s Not a Discount Problem. It’s an Attention One.

Gen Z isn’t just here for the deals. They’re seeking brands that hold their attention.

Gen Z is the most active generation in restaurant loyalty programs right now. According to data from the PAR Punchh platform, they account for 38 percent of loyalty sign-ups and 35 percent of check-ins across the platform in 2024, surpassing every other generation. They are showing up, signing up and coming back.

Like the generations before them, they love a good deal — but they are looking for overall value, not just price. The data shows Gen Z wants rewards to be instant, relevant and easy to use. So why are so many operators still trying to win them with a 10 percent off coupon? 

Here’s the mistake I see most often: Operators treat Gen Z like a discount problem. These are digital natives who have spent their entire lives learning to scroll past things that don’t earn their attention. A generic promotion won’t make them pause. The right moment will. 

What Does Gen Z Actually Want?

Before we talk about what to do, let’s look at what the data actually shows, because some of it runs counter to conventional wisdom.

Gen Z has a lower discount rate than Millennials in both QSR and fast casual. That means they’re redeeming offers less aggressively. They’re not trying to extract maximum value from your program the way a deal hunter would. They’re looking for reasons to stay engaged. When you do the math, that actually makes them more profitable guests — when you get the relationship right.

They’re also remarkably consistent digital users. While Millennials have steadily pulled back from online ordering since the pandemic, Gen Z has maintained roughly 42 percent of their transactions through digital channels. They didn’t go back to old habits. This is just how they operate.

Gen Z’s annual spend is growing fast. They’re not your most valuable customer yet — but they’re trending in that direction. Building relationships and loyalty must start now.

Attention Is Currency

So if it’s not about deeper discounts, what is it about?

It’s about stopping the scroll.

Gen Z lives inside a content environment that is relentlessly competing for their attention. The brands that break through — in any category, not just restaurants — are the ones that give them something worth engaging with. A reason to lean in. A moment of surprise. A feeling that this brand actually gets them.

In loyalty, that shows up in a few specific ways:

●      Immediacy

Gen Z responds to instant, tangible rewards, not points that accumulate toward some future redemption. Think instant points for signing up, digital challenges that pay off within the visit, and upgrades that feel spontaneous rather than earned through bureaucratic accumulation. One large QSR brand we work with introduced a spin-to-win mechanic tied to a specific daypart — breakfast — and saw meaningful lifts in morning visit frequency from younger guests. The game was simple. The reward was immediate. The engagement was real.

●      Exclusivity 

Gen Z has a strong radar for things that come off as generic, and they tune them out fast. But give them access to something that speaks to them — a secret menu item, an early drop, a members-only experience tied to something culturally relevant — and the response is completely different. A fast casual brand we work with launched a limited offering tied to a cultural moment that had nothing to do with food. It got shared. It drove app downloads. And it sold out with no coupon required.

●      True Personalization 

Sending a burger promotion to a vegetarian isn’t personalization. But when you have item-level transaction data and the right platform to act on it, you can build offers that are unmistakably specific. A guest who orders the same specialty drink three times a week doesn’t need a discount on that drink. They might love an exclusive upgrade, or a bonus points streak tied to their habit, or a recommendation for something adjacent they haven’t tried. That’s when loyalty crosses from marketing to a real relationship.

How Operators Can Capitalize on Gen Z Loyalty 

None of this requires a complete overhaul. It’s merely a shift in how you think about what loyalty is for.

If your program is primarily a vehicle for pushing discounts to a list of email addresses, Gen Z will clock that immediately and disengage. They have spent their whole lives filtering out exactly that kind of communication. Punchh platform data shows that email open rates for Gen Z are lower than any other generation and declining. Push notification performance tells a similar story. 

These channels still work, with the right strategy. Successful operators are designing for engagement first and discount second. They’re using gamification not as a gimmick but as a genuine mechanic for habit formation. They’re building programs that feel alive, that change, that surprise, that respond to behavior instead of just rewarding spend.

Recognition across channels, item-level data, and dynamic offer management are essential for capturing the attention of the next generation. You cannot deliver a personalized, real-time loyalty experience on infrastructure that wasn’t built for it. You’ve got to design and integrate your tech stack with engagement in mind. 

The Window for Building Loyalty Is Open, But Not Forever

Gen Z is engaging with loyalty programs at rates we haven’t seen before. But they don’t give second chances the way older guests do. 

The operators who build the programs, the tech, and the creative muscle to earn Gen Z’s attention rather than just their coupon redemption will establish a durable relationship with the highest-growth customer segment in the industry.

The ones who keep treating it like a discount problem are going to keep getting discount results.