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Rewarding customers for their loyalty is now a common practice among businesses. According to research, 84% of consumers will keep buying from a brand that offers a loyalty program. Research also shows that loyalty reward cards motivate customers to spend more. It encourages them to establish a long-term relationship with a brand.
How is that possible? The answer is obvious. By developing a loyalty reward program, you can create custom loyalty cards and provide special deals, discounts, or gifts to your customers. It makes their shopping experience more enjoyable and promotes repeat purchases.
Loyalty reward cards are an effective way of proving you care about your customers. You can now easily design a loyalty program with PassKit to keep customers returning.
PassKit lets you create and launch loyalty reward cards in just a few clicks. Instead of developing a custom app, use PassKit to reward consumers and offer a frictionless experience through Google Pay and Apple Wallet.
In this article, we will reflect on loyalty reward cards, how you can manage them and why you should leverage PassKit. Let’s begin with some basic information on loyalty programs.
What are loyalty programs?
You can use customer loyalty programs to boost your marketing strategy. They help you reward customers who frequently buy or engage with your business. You can offer incentives and benefits to retain existing customers, attract new ones, and increase sales.
Loyalty members receive all kinds of perks. The incentives range from gifts, vouchers, coupons, or access to limited edition products. Customers can join rewards programs, earn points through purchases and enjoy these benefits in the long run.
According to research, successful loyalty rewards programs increase revenue by 15% to 20% annually. If you want existing customers to spend more, launching rewards programs is the way to go.
What are loyalty reward cards for loyal customers?
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By using loyalty reward cards, consumers receive rewards. The customer needs to use the card each time they make a purchase. In return, they get points, airline miles, vouchers, or other incentives.
Loyalty reward cards help any business create success stories. If you own a coffee shop, nail salon, hotel, restaurant, gym, or similar business, you can introduce reward cards to increase customer retention and loyalty.
Consumers get added value from each purchase, and you get loyal customers. It’s a win-win situation for everyone!
How do loyalty reward cards increase customer loyalty?
Loyalty reward cards bring consumers closer to your brand. One study reveals that 75% of customers favor businesses that offer rewards.
The modern customer does not want to feel like a number to you. They don’t want to be just another person who visits your website or shop. They crave a more personalized approach that shows your business values their time and money.
Customer loyalty increases when they receive rewards. When a customer spends money, they want something in return. You can offer shoppers a chance to earn points through a customer loyalty program and redeem rewards that best suit their needs.
What is the key reason for implementing loyalty reward cards?
Customers will choose you instead of competitors. Also, the best loyalty reward cards collect customer data. You can use it to send tailored offers and recommendations to consumers.
For instance, PassKit allows you to create digital loyalty reward cards. You can update the cards to cater to different consumer needs. We collect data that reveal customer preferences.
As a result, you can promote personalized offers to increase sales. Personalized customer experience increases loyalty and encourages people to return.
Let’s now see which benefits loyalty reward cards bring to the table.
What are the benefits of loyalty reward cards?
Here are the top advantages of loyalty rewards programs:
- Increase customer retention – a loyalty reward card gives customers a compelling reason to buy again from you. They know that each purchase counts. They can expect a pleasant surprise from your company when they accumulate enough points.
- Award repeat customers – loyalty cards make people feel good about choosing your brand. Consumers know you appreciate their business and feel like they are saving money on purchases.
- Boost sales – most companies launch loyalty cards to motivate customers to buy. They get a steady amount of revenue from the program. A discount may influence even reluctant buyers to purchase a product or service.
- Attract new customers – loyalty programs reward customers, but they also attract new consumers. Those who haven’t purchased from you may do so after hearing about your exceptional customer loyalty program.
- Track metrics – it’s easier to collect data on purchases and spending habits with loyalty programs. The metrics can help you develop new marketing ideas and better promotions. For instance, customer experience metrics tell how consumers view your brand.
Although beneficial to your brand, you may encounter specific challenges when managing a loyalty reward card. Let’s discuss the most common ones.
The top 15 challenges of managing loyalty reward cards
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Managing loyalty programs on your own is not easy. Most companies face the same issues that prevent them from profiting from loyalty programs in the long run.
Let’s look at the top 15 challenges to help you avoid them on time.
1. Designing a thriving loyalty rewards program
Many companies use a loyalty rewards program to attract customers with different benefits. Sometimes, however, their loyalty programs may be identical. You can’t design a thriving loyalty rewards program if it resembles competitors. You need to find a way to differentiate your brand.
We suggest the following:
- Analyze competitors’ terms and conditions for customer loyalty programs
- Take a look at their membership stipulations, requirements, and rewards
- Find a unique way to set your loyalty rewards program apart
Offer something unique to consumers and you will create a thriving loyalty rewards program.
2. Not knowing what incentives to offer
Customers change their minds quickly. They are always looking for another business and a better loyalty program. However, they will continue earning loyalty points with your brand if you offer attractive incentives.
Now, this is easier said than done. Here are some ideas for incentives you can use:
- Free products or services – this is one of the most popular incentives. It works well for a gym, hotel, catering business, or nail salon. Consumers love getting free stuff. For instance, you can give them a free product or service after they make five or ten purchases.
- Vouchers – consumers receive a coupon depending on how many points they’ve earned. For instance, they get 500 points for spending $5. Those 500 points become a $5 voucher.
- Discounts – what can encourage a reluctant customer to buy? Valuable discounts enable them to pay less for their favorite product or service.
- Birthday gifts – remembering consumers on their special day is a good tactic. Send birthday gifts to loyal customers who will surely recommend your brand to family and friends.
- Access to exclusive products – loyalty members should receive exclusive gifts. For instance, you can tell them to pick up a free sample of your limited edition product.
You may also want to consider offering a variety of incentives so that there is something for everyone.
3. Getting customers to enroll in the loyalty rewards program
Your loyalty program can’t thrive without members. You need to develop a strategy to promote the program effectively.
For instance, you can leverage the following methods:
- Add a link to your website – you can create a signup page on your website. With PassKit, you can leave a link or a QR code your customers can scan to enroll and download your reward cards instantly.
- Use social media – existing and new customers follow you on social media. Use these platforms to share information about your loyalty program.
- Start with email marketing – you can target different audience groups. Tell them how loyalty cards improve the shopping experience and how many points they need to get vouchers and other rewards.
By taking these steps, you can encourage more customers to take advantage of your loyalty rewards program and enjoy its benefits.
4. Providing a personalized customer experience
It’s impossible to create a personalized customer experience without data. Knowing which discounts customers use, their spending habits, and preferences is paramount.
However, collecting data on your own is not easy. It takes time and much effort. That is why you should use digital loyalty software like PassKit. We collect customer insight to help you personalize the experience.
Sign up for our 45-day free trial to impress your audience!
5. Providing a connected customer experience
Delivering a connected customer experience is a must. Consumers must feel the connection between online and offline interactions with your brand. They shouldn’t get different information while purchasing online or in-store.
PassKit leverages Apple Wallet and Google Pay to connect the two worlds. Customers can download and store digital loyalty cards, membership cards, or coupons in their mobile wallets while browsing your website or visiting your store, salon, gym, restaurant, or cafe.
6. Tracking multiple loyalty reward cards
Your loyalty program will grow. The number of loyalty reward cards will increase. You’ll realize it’s nearly impossible to keep track of all your loyalty cards.
However, digital loyalty programs such as PassKit make lives easier. PassKit eliminates physical loyalty cards and allows you to track all digital rewards cards in the cloud.
PassKit records data such as
- The number of issued loyalty cards
- Loyalty points per member
- Vouchers per member
- The number of redeemed vouchers
Whichever method you choose, find a system that works to take advantage of all the benefits that rewards programs offer.
7. Tracking expiration dates
Nothing puts customers off a loyalty program like expired vouchers or points. Consumers can’t receive reminders about rewards when they use paper loyalty cards.
If you don’t want to lose customers, switch to digital loyalty reward cards to easily track expiration dates, remind your customers and improve their experience with your brand.
8. Tracking redemption rates
Redemption rates show how customers engage with your loyalty program and what rewards best align with their needs.
It is where PassKit comes in handy. Our platform provides actionable insights to help businesses determine the success of their customer loyalty programs. You can see the number of:
- Enrolled members
- Installed cards to mobile wallets
- Uninstalled cards from mobile wallets
- Deleted members
With PassKit, you can track your results by day, month, or year or set custom dates to evaluate your performance.
You can also see which mobile wallets your customers use most often and what distribution channel brings you the most loyalty program members.
9. Tracking customer behavior
You can’t track customer behavior unless you use specialized software. Evaluate your current tech stack and consider including PassKit, which helps you track and identify patterns in customer behavior and adjust your marketing efforts accordingly.
You can use purchase data to track what customers buy and how often they buy it. It gives insight into what products, services and rewards customers like the most.
You can understand what motivates customers to join and participate in your loyalty program and what benefits they value most.
10. Wasting money on unredeemed points
Your business spends money on rewards. Every unredeemed voucher or point costs you. After all, the success of a loyalty program depends on whether or not people use their points.
Having an unprofitable loyalty program is a top challenge for any company. You must develop a strategy to encourage people to use your points and rewards.
11. Difficulty measuring the ROI
If you only look at loyalty program costs, you will fail to recognize your return on investment (ROI). Although most marketing and sales tactics are difficult to measure, this isn’t true for loyalty programs.
Some customer loyalty software, such as PassKit, provides you with enough data and calculates your ROI automatically. It helps you quickly understand the benefits of loyalty reward cards for your business.
12. Providing customer support
Customers will inevitably question your rewards, vouchers, discounts, and special offers. They should get answers quickly by contacting your customer support.
Consumers might abandon your business if you don’t solve their pain points efficiently. Train your customer support team and prepare answers to all customer objections to ensure their satisfaction.
13. Designing targeted promotions
You need to segment your customers based on their purchase history, demographics, or other factors. Once your segments are defined, you can start designing targeted promotions that appeal to each group.
For example, if you have customers who are heavy buyers of your products, you might want to design a promotion that offers a discount on their next purchase. If your customers are infrequent buyers, you might want to create a promotion that offers a gift with a purchase.
The key is to tailor your promotions to the specific segments you’ve defined to maximize your chances of success. By doing so, you’ll be able to keep your loyal customers happy and engaged while attracting new customers to your program.
14. Struggling to integrate with other systems
If your go-to software does not include integrations, your customers might miss out on points. Your company won’t be able to track their purchasing habits and behavior either.
Integrations enable you to connect your loyalty program to third-party apps to enhance the features. You might also connect to your POS and CRM to collect customer data and improve the shopping experience.
15. Scaling and maintaining the loyalty rewards program over time
Don’t assume it’s enough to launch a loyalty program and offer some benefits. You have to keep an eye on the future. You must scale up rewards and perks to engage your customers as your company grows.
Some businesses, however, forget about this. If your program remains the same for years, you will lose customers.
Let’s now see how you can manage loyalty rewards cards with PassKit and eliminate all these issues mentioned in this section.
How to manage loyalty rewards cards with PassKit
Creating loyalty cards for business is easier with PassKit. Our customer loyalty platform also helps you overcome the top 15 challenges we mentioned above. Here’s how.
1. Design a loyalty rewards program without building a custom app
A loyalty program is an effective way to beat competitors and reward customers. Some businesses decide to build a custom app for this purpose. However, they quickly realize their mistake.
There is a more cost-effective and less time-consuming solution to design a loyalty rewards program—PassKit.
PassKit is a digital loyalty platform that lets you launch your program without custom app development, coding, or design skills. You can create digital loyalty reward cards, membership cards, or coupons. Customers can store and use these cards with two popular mobile wallets – Apple Wallet and Google Pay.
2. Harness the power of native system integrations
PassKit allows you to integrate with popular CRM, email, and automation platforms. For instance, you can integrate your loyalty program with Mailchimp without any coding experience.
You just need to use Zapier. You will then have the option to integrate your PassKit account with countless apps. The process is short and straightforward:
- Visit Zapier
- Register a new member using Mailchimp or other apps (e.g., PayPal)
- Feed the information to our platform to create a digital loyalty card
- Update the information in PassKit and send that new information to your app of choice
You don’t need to be a developer to use our native system integrations!
3. Create loyalty rewards cards quickly and efficiently
Forget about spending weeks creating loyalty rewards. PassKit enables you to design loyalty rewards cards quickly and efficiently.
Our platform is easy to use. You are only a few clicks away from designing a card and inviting existing and new customers to your loyalty program.
Here’s what you need to do:
- Create a PassKit account
- Choose the card you want to make
- Adjust your card according to Google or Apple design
- Select a barcode type
- Add visuals such as your logo and Hero image
- Choose the color palette
- Fill in the necessary fields
- Include other information like social media accounts and the official website
That’s it! We pride ourselves on this easy process. We know you’ll enjoy it too!
4. Promote your loyalty rewards program online and offline
PassKit enables you to promote your loyalty rewards program on multiple channels. Here are some of your options:
- NFC payment terminal
- SMS marketing
- Social media
- Receipt marketing
- Email marketing
- In-app advertising
It’s not easy to set up and manage a multichannel distribution system. The costs increase over time because you need a bigger team to ensure everything runs smoothly.
PassKit helps you manage multichannel distribution without spending too much. You can reach new customers or connect with existing ones on multiple platforms. It will create a connected customer experience that increases customer loyalty and expands your consumer base.
5. Gather and track loyalty rewards program data
PassKit collects valuable loyalty rewards program data. You can easily track its performance and learn more about customer behavior.
Our advanced analytics ensure you make smart and informed business decisions. You can improve your program and understand what consumers expect from you.
Loyalty reward cards: What to do next?
Loyal customers are the best customers. However, you have to earn their loyalty first. Creating a program that rewards them for their trust is the most effective way.
Loyalty reward cards are a popular marketing tactic today. However, managing the program is not easy. That’s why you need PassKit.
PassKit provides an easy and quick way to build loyalty reward cards. Our platform connects the online and offline worlds to ensure customers receive a seamless shopping experience.
The best thing is that you don’t need custom app building, coding, or design experience—our customer loyalty platform is suitable for non-tech-savvy people.
Sign up and launch your loyalty program with PassKit!
Loyalty reward cards: FAQ
Here are the answers to the most asked questions about loyalty reward cards.
How do loyalty cards work?
A customer receives a digital loyalty card. They need to scan it after each purchase to earn points and rewards.
What are the benefits of loyalty cards?
Loyalty cards are beneficial to businesses. They help companies increase sales, award current customers, attract new consumers and increase retention rates.
What is considered a loyalty card?
A loyalty card is a marketing tactic that helps companies improve customer loyalty. It is a digital or physical card used by consumers after purchases. It allows them to collect points and redeem rewards.
How do you reward loyal customers?
You can launch a loyalty program that ensures customers earn rewards and points for every purchase. They can use their loyalty card to redeem a voucher, discount, or receive a gift. You can also reward loyal customers by giving them access to limited-edition products.