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/ Digital Stamps

Do store loyalty cards work?

Do store loyalty cards work?

Since Tesco introduced customers to the Clubcard in 1995, we’ve seen thousands of retailers launch their own store loyalty cards. While many of these loyalty schemes have been very popular, they also present the problem of too much choice.

The overwhelming number of loyalty programs makes it hard for customers to navigate the space, resulting in a decline in the take up of store loyalty cards. Your traditional store loyalty programs also have a blind spot when it comes to attracting new customers, therefore not meeting one of your core business objectives.

Let’s take a closer look at why store loyalty cards may not be meeting the mark for your business.

Customer uptake of store loyalty cards is in decline

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With so many loyalty programmes on offer, customers often end up with multiple store cards on them. Having to carry so many cards can be an inconvenience, and many customers don’t want to deal with the bother.

Most modern loyalty schemes also come with a mobile app that customers can download to browse through offers and track their rewards. While this seems like a great idea in our mobile-obsessed world, customer research shows that people don’t want to deal with the hassle of downloading yet another app and ending up with a clogged phone.

In practice, any extra steps in your loyalty membership process result in turning your customers off from joining.  

Finally, all loyalty schemes require customers to submit their details to join. As modern consumers become increasingly wary of sharing their personal data, this is another obstacle that prevents many people from joining.

Customers want to have loyalty rewards. But all these factors have contributed to the steady decline of store loyalty card subscriptions among new customers in general, and particularly the younger generation.

Store loyalty cards fall short of their promise to your business

When it comes to the question of whether store loyalty cards are meeting your objectives, many businesses find that they serve their purpose as retention but not for acquisition.

These schemes can reach only your existing customers that have subscribed to the loyalty card. At the moment, this stands below 50% of regular SME merchant customers on average.

As a result, you will still be missing out on important insights into over half of your regular customers.

Current loyalty cards also don’t give you any means of directly communicating your offers to over 50% of your customers.

Customers want to have loyalty rewards. But all these factors have contributed to the steady decline of store loyalty card subscriptions among new customers in general, and particularly the younger generation.

Is there a way forward?

In our increasingly competitive digital age, retaining existing customers and winning new customers requires a varied strategic approach.

This approach should include tailored offers and personalised communication as well as relevant content and a sense of community across different channels.

Consumer research has shown that 75% of customers find points and rewards to be the most attractive feature of their loyalty card. 67% also showed appreciation for personalised rewards.

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With the trend of customisation and personalisation being popular with consumers across the board, you, as a modern business owner, should focus on creating a loyalty programme that feels genuinely personalised and unique for each customer.

You should also ensure that the process of subscribing to the scheme and using the card is convenient and hassle-free.

It's a well-known fact that high street merchants are always searching for more targeted and cost-effective ways to reach their audience. Data that offers valuable insights into their customer’s needs and behaviours can help to achieve that.

How can we help you to meet your customer needs more effectively?

At OMG, we believe that there is a way forward.

We’re currently working on a solution that will bring our customers and partner merchants closer together for the mutual benefit of both.

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A solution that seamlessly integrates loyalty cards, making them convenient for you and your customers. And in a way that puts you in control of communicating with your customers and creating a truly personalised experience that people will want to share.

Are you interested in finding out more?

Alexey Gutin

Read more posts by this author.