The power of payment-linked loyalty
To help address growing customer retention challenges, businesses are looking to technology solutions that can help them leverage their most critical asset: customer data. One way to do that is with payment-linked loyalty.
What is payment-linked loyalty?
Payment-linking technology is a way for customers to “link” a payment method to a merchant’s loyalty app. In this way, customers don’t need to change their behaviour. Besides one payment-link step, they can transact as they always have and earn loyalty without having to do anything else – it’s completely seamless. In the process, merchants get to gather valuable, anonymised transaction data when customers shop with their preferred payment method. That data then helps merchants build a single customer view. The type of information they can collect via payment-linking technology helps them gain insight into how and when your customers transact – offering a more complete picture of individual purchasing history.
Innovative everyday solutions
Unfortunately, many merchants are still clinging to woefully outdated customer loyalty and rewards models. While the old card-punch routine might have made sense before, today there are better ways to delight customers with digitised payment-linked loyalty programmes.
“The trend for customers is towards simplicity and speed of checkout, as seen with the rapid adoption of tap-to-pay. We, therefore, decided to link loyalty to this, which enables earning into the retailer’s loyalty programme seamlessly on the back of a bank card payment. No additional cards, no additional steps.” Bevan Ducasse – CEO of Yoyo
In this way, bank payment-linked loyalty enables frictionless loyalty-earn, by having customers link their bank card once in-app and auto-earn every time they pay using their linked bank card, Apple Pay, or any other qualifying payment method.
The rules of rewards
Some of the best examples of building customer loyalty through value sharing can be found in traditional small businesses. For many years, successful neighbourhood merchants have intuitively understood the broader strategic purpose behind an effective rewards programme. Such businesspeople make it a point to get to know their best customers personally and often reward them with special services and attention – notifying them when sought-after merchandise arrives, for example, or giving them a free drink or a special dessert. They know that delivering increased value to profitable customers turns them into loyal customers; and that loyal customers become even more profitable over time. In fact, customers who have an emotional connection with a business have a 306% higher lifetime value.
Benefits of payment-linked technology
Payment linking technology has a number of advantages for the loyalty model. Firstly, this process eliminates the need for a separate loyalty card to identify the customer, as they’ll be identified by their transaction alone. This means that no transaction is ever missed and the solution is very well suited to an omnichannel engagement.
The other key benefits of payment-linked loyalty technology includes:
1. Entry to an existing ecosystem of providers
Yoyo Go’s payment-linked loyalty technology plugs app users straight into an existing ecosystem of rewards providers. This means customers can access a diversity of merchants who offer more rewarding buying experiences. With rewards more closely aligned to customer preferences, merchants tend to see higher levels of participation and retention.
2. Lower cost of entry
Merchants don’t have to bear the burden of creating and managing the loyalty programme themselves. With no technology build required, it’s fast to set up, affordable to maintain, and easy to manage.
3. Access to data
Aggregated customer data is available, which lets merchants see the effect of different offers they make inside the loyalty programme. They can then adjust these offers on the fly to increase appeal, improve customer retention, drive individualised or targeted interactions, and manage future marketing and promotion efforts more effectively.
4. A more streamlined process
Because there is no need to use a separate loyalty card, customers can participate in the loyalty initiatives more easily. By removing this barrier, merchants can gain a higher rate of participation, which adds to the value of the programme.
5. User-friendly campaign functionality
Merchants can also launch campaigns to reward loyal customers while driving certain business objectives to increase basket size, improve sales on certain days and times of day, and attract new customers.
Revolutionise your business
Moving to an app-based payment-linked loyalty programme allows merchants to transform their rewards system and attract more customers, deliver a more empowering customer experience, and increase customer loyalty. Because the programme is payment-linked, it works seamlessly without customers having to change their purchase behaviour. In fact, a whopping 59% of consumers have stated that they would likely join a loyalty initiative offered on a digital app.
Interested in an app-based card-linked loyalty solution of your own?