Loyalty schemes are hugely popular in the UK. A prominent report from YouGov reveals that three-quarters of Britons are members of at least one loyalty programme.
YouGov’s report also revealed that 72% of Brits consider loyalty schemes to be a good way to reward consumers. And 59% of those surveyed stated that all brands should offer loyalty programmes of some sort.
Modern consumers are looking for ease and convenience when it comes to shopping. Personalisation and material rewards also play an increasing role. Customers want more customised offers tailored to their tastes and preferences.
However, customers increasingly find carrying multiple loyalty cards inconvenient. They feel overwhelmed by the sheer number of loyalty schemes available to them.
This is where Cashback on Purchase comes in. Cashback on Purchase allows to reward your customers at the point of sale while also incentivising loyalty and repeat purchases.
What is Cashback on Purchase, and how does it work?
Cashback on Purchase is when the customer gets a percentage of their money back in exchange for their purchase. There are two main ways for a customer to receive cashback on purchase:
- by using a bank that offers cashback on purchases made using their card, or
- by subscribing to a cashback or discount website.
To avoid confusion, Cashback on Purchase is different from the “over the counter” cashback, where the customer withdraws some physical cash from the till in addition to making a purchase, as an alternative to an ATM cash withdrawal.
Different ways you can offer Cashback on Purchase
Cashback on Purchase becomes your powerful loyalty instrument when you combine it with other promotional offers. Cashback rewards can be offered based on a variety of parameters, for example:
- the sum of purchase,
- the time of purchase,
- the history of purchases,
- the number of purchases in a period, and
- the total amount spent in a period.
Cashback on Purchase allows you to create personalised targeted campaigns and replace less efficient and time consuming traditional schemes such as flat discounts, stamp cards, and loyalty points cards.
Instead, you can replace them with highly flexible loyalty schemes that:
- attract new customers,
- reward existing customers for their purchases
- incentivise bigger purchases, and
- encourage repeat custom.
Current UK cashback market solutions
While points-based loyalty programs and stamp cards are widespread in the UK, Cashback on Purchase is the one most underrepresented and is most in demand by the customers.
Some British banks offer customers cashback on their card purchases. However, this increases loyalty for the bank itself. It doesn’t do anything to increase customer loyalty towards your business when customers buy from you.
American Express is the only exception to this. Still, it’s sparingly accepted by merchants due to the significant fees per each customer purchase.
Customers can also get cashback on purchase using websites such as Quidco and TopCashback. However, less than 5% of Brits are currently regular users on those sites. The lack of uptake is largely regarded to the fact that they add an extra step in the customer journey that people find inconvenient.
OMG is building the biggest network of loyalty partners in the UK
As OMG, we are offering a convenient and seamless purchase and reward experience to your Customers. We are building a digital banking solution with the biggest network of loyalty partners in the UK, creating a win-win value proposition for both Merchants and Customers.
With OMG, you can enjoy business growth by getting more loyal customers, and Customers receive the best value for their loyalty.
We put you in control of how you set and control Cashback on Purchase settings so that you can do what’s best for your business.
Would you like to see how OMG can help you create your Cashback solution for customer loyalty?