Loyalty 2.0 – cards, apps & data


Retail loyalty in the UK took a big jump forward this month with Tesco’s revamped Clubcards hitting doormats. With 66% of global shoppers enrolled in loyalty programmes (Nielsen) and cardholders spending between 12-18% more than other customers (Accenture), loyalty schemes are a key differentiator for UK retailers.

But how are card-based loyalty schemes changing and what does this mean for retailers and consumers?

Improving accessibility and engagement

Increasing loyalty channels and accessibility is a trend across many of the large loyalty schemes we work with. While plastic cards and keyfobs still sit at the heart of most schemes, gone are the days of them being the sole feature. Online portals have been around for years, but are becoming more sophisticated, and companion mobile applications have moved beyond being a tool to simply check points tallies. Think push notifications for offers, digitized loyalty cards and in-app coupons. This multi-channel approach ensures everything is accessible to customers, all the time.

Next gen cards

Cards are changing.

We’ve all been there. You try and scan the barcode but it has partially rubbed off so the cashier has to key in the 18-digit number from the card. A slow and laborious process for all involved. Best practice mitigates these issues and adds even more. Firstly, by printing information like barcodes onto the card material prior to encapsulating it with a specialist machine, barcodes can no longer be damaged over the lifecycle of the card or keyfob.

More excitingly, technology from the payments industry is now being used by leading schemes. Contactless cards have made a huge impact on consumers because of their convenience and simplicity and now loyalty cards are catching up. Combining contactless with magnetic stripe and barcodes on cards gives customers three ways to interact at the point of sale, improves data security and speeds up the process. You’re going to see lots more contactless loyalty cards rolling out over the next year.

Data, data everywhere

Data has always been a key driver for retailers offering loyalty schemes. Tapping into buying trends and sharing tailored offers keeps customers coming back. Combining cards and keyfobs with mobile apps, however, is delivering even greater insights and the ability for brands to act in real time. For example, location-based coupons and offers, tailored to a specific customer, can be pushed to their smartphone as they walk past the store.
Effectively utilising big data dominates discussion in boardrooms across the country and retailers have a real opportunity to use it to increase revenues.

Adding value

Increasing loyalty is all about giving customers value. But I’m not just talking about cheaper shopping. Retailers are working hard to deliver more engaging shopping experiences, to cut queueing times and make the whole process of shopping simpler. Gong beyond this, multi-function cards and mobile apps are a big hit. Consumers will love it if, with one tap of their loyalty card they have applied a coupon and topped up their points.
Brand tie ups are also a big part of all good loyalty schemes. Look at Tesco’s partnerships with Uber and Hotels.com for example. These kinds of links increase the value of schemes to consumers, making them stand out in an ever more competitive market.

So, brands are competing for space in wallets and on phones. Loyalty schemes have been around for a long time and most consumers already have a stack of plastic in their wallet. This is why the most innovative programme managers are working hard to set themselves apart, both through their cards, apps and online presence.


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