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A loyalty program is a
marketing strategy Marketing strategy allows organizations to focus limited resources on best opportunities to increase sales and achieve a competitive advantage in the market. Strategic marketing emerged in the 1970s/80s as a distinct field of study, further buil ...
designed to encourage
customer In sales, commerce, and economics, a customer (sometimes known as a client, buyer, or purchaser) is the recipient of a good, service, product or an idea - obtained from a seller, vendor, or supplier via a financial transaction or exchan ...
s to continue to shop at or use the services of a
business Business is the practice of making one's living or making money by producing or buying and selling products (such as goods and services). It is also "any activity or enterprise entered into for profit." Having a business name does not separ ...
associated with the program. Today, such programs cover most types of commerce, each having varying features and rewards schemes, including in banking, entertainment, hospitality,
retailing Retail is the sale of goods and services to consumers, in contrast to wholesaling, which is sale to business or institutional customers. A retailer purchases goods in large quantities from manufacturers, directly or through a wholesaler, and t ...
and travel. The market approach has shifted from product-centric to a customer-centric one due to a highly competitive market and a wide array of services offered to customers, therefore, it's important that marketing strategies prioritize growing a sustainable business and increasing customer satisfaction. A loyalty program typically involves the operator of a particular program set up an account for a customer of a business associated with the scheme, and then issue to the customer a loyalty card (variously called
rewards card A loyalty program is a marketing strategy designed to encourage customers to continue to shop at or use the services of a business associated with the program. Today, such programs cover most types of commerce, each having varying features and ...
, points card, advantage card, club card, or some other name) which may be a
plastic Plastics are a wide range of synthetic or semi-synthetic materials that use polymers as a main ingredient. Their plasticity makes it possible for plastics to be moulded, extruded or pressed into solid objects of various shapes. This adapta ...
or paper card, visually similar to a
credit card A credit card is a payment card issued to users (cardholders) to enable the cardholder to pay a merchant for goods and services based on the cardholder's accrued debt (i.e., promise to the card issuer to pay them for the amounts plus the ...
, that identifies the cardholder as a participant in the program. Cards may have a barcode or
magstripe The term digital card can refer to a physical item, such as a memory card on a camera, or, increasingly since 2017, to the digital content hosted as a virtual card or cloud card, as a digital virtual representation of a physical card. They share ...
to more easily allow for scanning, although some are
chip card A smart card, chip card, or integrated circuit card (ICC or IC card) is a physical electronic authentication device, used to control access to a resource. It is typically a plastic credit card-sized card with an embedded integrated circuit (IC) c ...
s or proximity cards. By presenting a card, customers typically receive either a discount on the current purchase or an allotment of points that they can use for future purchases. Hence, the card is the visible means of implementing a type of what economists call a two-part tariff. Application forms for cards usually entail agreements by the store concerning customer privacy, typically non-disclosure (by the store) of non-aggregate data about customers. The store uses aggregate data internally (and sometimes externally) as part of its
marketing research Marketing research is the systematic gathering, recording, and analysis of qualitative and quantitative data about issues relating to marketing products and services. The goal is to identify and assess how changing elements of the marketing mix i ...
. Over time the data can reveal, for example, a given customer's favorite brand of beer, or whether they are a vegetarian. Where a customer has provided sufficient identifying information, the loyalty card may also be used to access such information to expedite verification during receipt of cheques or dispensing
medical prescription A prescription, often abbreviated or Rx, is a formal communication from a physician or other registered health-care professional to a pharmacist, authorizing them to dispense a specific prescription drug for a specific patient. Historicall ...
preparations, or for other membership privileges such as access to an
airport lounge An airport lounge is a facility operated at many airports. Airport lounges offer, for selected passengers, comforts beyond those afforded in the airport terminal itself, such as more comfortable seating, quieter environments, and often better acce ...
using a frequent-flyer card. In recent years, businesses now offer these loyalty cards in the form of a loyalty app, which means users are less likely to lose their cards. Almost all major casino chains also have loyalty cards, which offer members tier credits, reward credits, comps, and other perks based on card members' " theo" from gambling, various demographic data, and spend patterns on various purchases at the casino, within the casino network, and with the casino's partners. Examples of such programs include Caesars Rewards (formerly called Total Rewards) and
MGM Resorts International MGM Resorts International is an American global hospitality and entertainment company operating destination resorts in Las Vegas, Massachusetts, Detroit, Mississippi, Maryland, and New Jersey, including Bellagio, Mandalay Bay, MGM Grand, and ...
's Mlife. Loyalty programs have been described as a form of centralized
virtual currency Virtual currency, or virtual money, is a digital currency that is largely unregulated and issued and usually controlled by its developers and used and accepted electronically among the members of a specific virtual community. In 2014, the Europ ...
, one with unidirectional cash flow, since reward points can be exchanged into a good or service but not into cash.


History

Betty Crocker Betty Crocker is a brand and fictional character used in advertising campaigns for food and recipes. The character was originally created by the Washburn-Crosby Company in 1921 following a contest in the ''Saturday Evening Post''. In 1954, G ...
's loyalty points program, introduced 1929, ended in 2006, one of the longest running loyalty programs.
Fred Reichheld Fred may refer to: People * Fred (name), including a list of people and characters with the name Mononym * Fred (cartoonist) (1931–2013), pen name of Fred Othon Aristidès, French * Fred (footballer, born 1949) (1949–2022), Frederico R ...
(1996) ''The Loyalty Effect'', Harvard Business School Press, Boston, 1996.


By continent and country


Asia

* Hong Kong: Octopus Rewards,
MTR Corporation MTR Corporation Limited is a majority government-owned public transport operator and property developer in Hong Kong which operates the Mass Transit Railway, the most popular public transport network in Hong Kong. It is listed on the Hon ...
. Different chain stores under common ownership often share the same loyalty program, such as
A.S. Watson Group A.S. Watson Group (or A.S. Watson or ASW) is the world's largest international health and beauty retailer, with over 16,000 stores in 27 markets worldwide serving over 5.3 billion customers every year, and over 137 million loyalty programme mem ...
's ''MoneyBack'', which can be used at Parknshop,
Watsons Watsons () is a Hong Kong health care and beauty care chain store in Asia and Europe. It is the flagship health and beauty brand of the A.S. Watson Group, which is majority owned by CK Hutchison Holdings. It operates near 8,000 stores an ...
, and Fortress stores, as well as the corporation's retail partners. HKT's The Club also offers a similar loyalty program. Flag airline carrier
Cathay Pacific Cathay Pacific Airways Limited (CPA), more widely known as Cathay Pacific (), is the flag carrier of Hong Kong, with its head office and main hub located at Hong Kong International Airport. The airline's operations and subsidiaries have ...
operates
Asia Miles Asia Miles is a loyalty and frequent-flyer program launched by Cathay Pacific. Launched in February 1999, it allows members to earn miles by making different purchases with co-branded credit cards or on partnered flights, hotels, dining, financia ...
, a loyalty and frequent-flyer program. * India: PAYBACK India is
India India, officially the Republic of India (Hindi: ), is a country in South Asia. It is the List of countries and dependencies by area, seventh-largest country by area, the List of countries and dependencies by population, second-most populous ...
's largest coalition loyalty program. German loyalty program operator Loyalty Partner took a controlling interest in i-mint in June 2010 and renamed the program PAYBACK India in July 2011. BPCL's PetroBonus fuel card program has 2 million members. Indian Oil's fleet card program XTRAPOWER and retail program XTRAREWARDS claim a combined customer base of 3 million. * Iran: The first
Iranian Iranian may refer to: * Iran, a sovereign state * Iranian peoples, the speakers of the Iranian languages. The term Iranic peoples is also used for this term to distinguish the pan ethnic term from Iranian, used for the people of Iran * Iranian lan ...
loyalty program launched in 1996. East Credit Card Group Kish launched its loyalty program in 2005. * Malaysia: Genting Highlands Resort loyalty card, WorldCard, is valid in three countries: Malaysia, Singapore and Hong Kong. * Philippines: SM Supermalls and BDO Unibank offer rewards cards which are accepted by The SM Store, SM Supermarket, SM Hypermarket,
ACE Hardware Ace Hardware Corporation is an American hardware retailers' cooperative based in Oak Brook, Illinois, United States. It is the world's largest hardware retail cooperative, and the largest non-grocery American retail cooperative. Founded in 19 ...
and Watsons Pharmacy. Robinsons Malls also offers a loyalty program through the Go Rewards app (formerly known as the Robinsons Rewards card). Others are
Jollibee Jollibee is a Filipino chain of fast food restaurants owned by Jollibee Foods Corporation (JFC). As of December 2021, JFC had a total of about 1,500 Jollibee outlets worldwide, with restaurants in Southeast Asia, the Middle East, East Asia ...
, (HappyPlus card), and Mercury Drug's Suki Card. * Singapore: Loyalty programs in Singapore include GrabRewards by Grab, SAFRA and Plus! from NTUC. * UAE: Yegertek UAE unded By NB Ventureshas various type of loyalty program and also gives Microsoft engage 365 solution form 2018. with Malta business ecabs circle celebrates 70,000 members.


Europe

* Austria: The two largest loyalty programs in
Austria Austria, , bar, Östareich officially the Republic of Austria, is a country in the southern part of Central Europe, lying in the Eastern Alps. It is a federation of nine states, one of which is the capital, Vienna, the most populous ...
are Payback and mo. JÖ was fully launched in 2019. * Finland: The two major retail coalitions with loyalty programs are the
S-Group The S Group ( fi, S-ryhmä, sv, S-gruppen) is a Finnish retailing cooperative organisation with its head office in Helsinki. Founded in 1904, it consists of 20 regional cooperatives operating all around Finland in addition to SOK, ''Suomen Osu ...
with their ''S-Etukortti'' card) and
Kesko sv, Kesko Abp , logo = Kesko logo.svg , logo_size = 150px , type = Julkinen osakeyhtiö , traded_as = , foundation = , location_city = Helsinki , location_country = Finland , key_people = Mikko Helander (President and CEO), Esa Kii ...
with ''K-Plussa'' (67%). * Georgia:
Georgia Georgia most commonly refers to: * Georgia (country), a country in the Caucasus region of Eurasia * Georgia (U.S. state), a state in the Southeast United States Georgia may also refer to: Places Historical states and entities * Related to the ...
's biggest loyalty card program has been run by Universal Card Corporation since 2010 via UNICARD. * Germany: The largest loyalty program is Payback, launched in 2000. and the Shell ClubSmart program are next in size. was launched by Arvato in 2008. HappyDigits was disbanded by 2010. * Hungary: SuperShop and Multipoint are their main loyalty programs. * Italy: After the exit of Nectar from the market in 2015, Payback is the most popular loyalty program. Supermarkets Esselunga, Coop and Il Gigante also have loyalty programs. * Latvia: One of the largest loyalty programs in Latvia which is working as an operator for many merchants is Pins. Another is Walmoo * Norway: The largest Norwegian loyalty program is Trumf. Trumf is a «brick and mortar» loyalty program owned by NorgesGruppen, a grocery wholesaling group in Norway. KickBack.no is one of the largest online loyalty programs and cashback sites in Norway. KickBack.no is owned by Schibsted Media Group. * Republic of Ireland:
Superquinn Superquinn was an Irish supermarket chain, founded in 1960 and entirely privately owned by the Quinn family. Select Retail Holdings, a property buying consortium, purchased the company from the Quinn family in 2005. A receiver was appointed to the ...
introduced its SuperClub loyalty card in 1993, the prototype for Europe. However, loyalty cards did not expand until 1997, when
Tesco Ireland Tesco Ireland is the Irish subsidiary of supermarket group Tesco. Tesco Ireland was formed by Tesco plc's 1997 purchase of the Irish retailing operations of Associated British Foods, namely Powers' Supermarkets Limited and its subsidiaries, tra ...
introduced its Clubcard scheme, shortly after its purchase of Power Supermarkets. SuperValu introduced their own loyalty club called Real Rewards. Others were: ** During the late 1990s—
Esso Esso () is a trading name for ExxonMobil. Originally, the name was primarily used by its predecessor Standard Oil of New Jersey after the breakup of the original Standard Oil company in 1911. The company adopted the name "Esso" (the phonetic ...
petrol program were: Tiger Miles, Maxol,
Texaco Texaco, Inc. ("The Texas Company") is an American oil brand owned and operated by Chevron Corporation. Its flagship product is its fuel "Texaco with Techron". It also owned the Havoline motor oil brand. Texaco was an independent company unt ...
and
Statoil Equinor ASA (formerly Statoil and StatoilHydro) is a Norwegian state-owned multinational energy company headquartered in Stavanger. It is primarily a petroleum company, operating in 36 countries with additional investments in renewable energy. ...
. Increasing oil prices ended these in 2005. **
Game A game is a structured form of play, usually undertaken for entertainment or fun, and sometimes used as an educational tool. Many games are also considered to be work (such as professional players of spectator sports or games) or art (suc ...
, a major computer game and hardware retailer, which merged with
Electronics Boutique EB Games (formerly known as Electronics Boutique and EB World) is an American computer and video games retailer. First established as an American company in 1977 by James Kim with a single electronics-focused location in the King of Prussia mall ...
's programme. ** Rewards From Us To You, a hotel loyalty program * Russia: MALINA, "the largest multicorporate customer loyalty program in Russia," was launched in 2006 by Loyalty Partners Vostok. Another is Mnogo.ru. * Switzerland: Loyalty programs are popular in
Switzerland ). Swiss law does not designate a ''capital'' as such, but the federal parliament and government are installed in Bern, while other federal institutions, such as the federal courts, are in other cities (Bellinzona, Lausanne, Luzern, Neuchâtel ...
, with the two main supermarket chains,
Migros Migros () is Switzerland's largest retail company, its largest supermarket chain and largest employer. It is also one of the forty largest retailers in the world. It is structured in the form of a cooperative federation (the Federation of Mig ...
and
Coop Coop, COOP, Co-op, or ''variation'', most often refers to: * A chicken coop or other enclosure * Cooperative or co-operative ("co-op"), an association of persons who cooperate for their mutual social, economic, and cultural benefit ** Housing co ...
prominent. The M-Cumulus card can be used at the Migros supermarkets, Ex Libris, SportXX, and other retailers. The Coop Supercard earns points on purchases at Coop and a variety of other associated stores. Other stores such as Interio, a furniture retailer, are also joining the market with loyalty cards and store-based incentivized credit cards. The only coalition loyalty scheme in Switzerland is Bonus Card with a network of over 300 independent retail partners. In recent years, online loyalty programs have also started to target the Swiss. First to make an offering in Switzerland was German-based Webmiles. Claiming to be Switzerland's first online bonus program, Bonuspoints was launched in early 2008 and offers incentives for shopping at 70 different online stores. * Turkey:
Pegasus Airlines Pegasus Airlines ( tr, Pegasus Hava Taşımacılığı A.Ş.) (), sometimes stylized as Flypgs, is a Turkish low-cost carrier headquartered in the Kurtköy area of Pendik, Istanbul with bases at several Turkish airports. History On 1 Decemb ...
has a loyalty program called Pegasus Plus which gives rewards for every flight. Passengers can spend reward points as a discount without waiting to cover a full flight.
Turkish Airlines Turkish Airlines ( Turkish: ''Türk Hava Yolları'') is the national flag carrier airline of Turkey. , it operates scheduled services to 340 destinations in Europe, Asia, Africa, and the Americas, making it the largest mainline carrier in the ...
has a loyalty program called Miles&Smiles. * United Kingdom: ''Passcard'' (later renamed ''Passkey'') was in the early 1980s.
Sainsbury's J Sainsbury plc, trading as Sainsbury's, is the second largest chain of supermarkets in the United Kingdom, with a 14.6% share of UK supermarket sales. Founded in 1869 by John James Sainsbury with a shop in Drury Lane, London, the company ...
'' Homebase Spend and Save Card'' was another early 1980s loyalty card. A later program,
Tesco Tesco plc () is a British Multinational corporation, multinational groceries and general merchandise retailer headquartered in Welwyn Garden City, England. In 2011 it was the third-largest retailer in the world measured by gross revenues an ...
's ClubCard, was criticized for not offering value for money. ''
The Economist ''The Economist'' is a British weekly newspaper printed in demitab format and published digitally. It focuses on current affairs, international business, politics, technology, and culture. Based in London, the newspaper is owned by The Eco ...
'' suggested that the real benefit of loyalty cards to UK outlets is the massive
marketing research Marketing research is the systematic gathering, recording, and analysis of qualitative and quantitative data about issues relating to marketing products and services. The goal is to identify and assess how changing elements of the marketing mix i ...
database potential they offer.
Morrisons Wm Morrison Supermarkets, trading as Morrisons, is the fifth largest supermarket chain in the United Kingdom. As of 2021, the company had 497 supermarkets across England, Wales and Scotland, as well as one in Gibraltar. The company is headq ...
is another program. Many stores have kiosks that, with the cards, print vouchers that can be used at the till.
Safeway's ABC Card was discontinued in 2000. Maximiles is an online coalition program.
Formerly operated by
British Airways British Airways (BA) is the flag carrier airline of the United Kingdom. It is headquartered in London, England, near its main hub at Heathrow Airport. The airline is the second largest UK-based carrier, based on fleet size and passengers ...
, Airmiles was the most popular flight-related loyalty program in the UK A re-brand of the program in 2011 from Airmiles to Avios caused controversy as members were now required to pay taxes and fees on flights they used for redemption. Co-operative Membership: the Co-op Group offers a 2% (previously 5%) refund to members on Co-op branded products with 2% also going to the cardholder's nominated charity. This is only available in Co-op Group stores. It replaced the dividend benefit previously used. Other Co-op chains continue with the dividend scheme, eg Midcounties Co-operative. Many of these accept other Co-operative loyalty cards but generally without the same benefits. For instance Midcounties Co-operative accept Co-operative Group cards but there is no charity donation or cardholder refund.


North America

* Canada:
Canadian Tire Canadian Tire Corporation, Limited is a Canadian retail company which operates in the automotive, hardware, sports, leisure and housewares sectors. Its Canadian operations include: Canadian Tire (including Canadian Tire Petroleum gas stations a ...
's
Canadian Tire money Canadian Tire money, officially Canadian Tire 'money' or CTM, is a loyalty program operated by the Canadian retail chain Canadian Tire Corporation (CTC). It consists of both paper coupons introduced in 1958 and used in Canadian Tire stores as s ...
is the oldest loyalty program in
Canada Canada is a country in North America. Its ten provinces and three territories extend from the Atlantic Ocean to the Pacific Ocean and northward into the Arctic Ocean, covering over , making it the world's second-largest country by to ...
.
Air Miles Air Miles is a group of loyalty programs operated by different companies in each region where the brand operates. The programs are available in Canada, the Netherlands and the Middle East. Points are earned on purchases at participating mercha ...
is Canada's largest loyalty program. The food and beverage industry also has several companies with rewards programs. * United States: In the US, loyalty cards have a long history. Some are only online. Some partner with classic credit cards.
Frequent-flyer program A frequent-flyer program (American English) or frequent-flyer programme (British English) is a loyalty program offered by an airline. Many airlines have frequent-flyer programs designed to encourage airline customers enrolled in the program ...
s and, less commonly ''SeaMiles'' co-exist with programs that donate a percentage of sales to a designated charity. Some American retailers either have not implemented these cards, or eliminated them, in favor of discounts for all shoppers. Few states regulate club cards. As an example, supermarkets in
California California is a state in the Western United States, located along the Pacific Coast. With nearly 39.2million residents across a total area of approximately , it is the most populous U.S. state and the 3rd largest by area. It is also the m ...
are subject to the Supermarket Club Card Disclosure Act of 1999. * Mexico: ''Bonvoy'' is a hotel-oriented loyalty program.


Oceania

Flybuys is the largest loyalty program in both
Australia Australia, officially the Commonwealth of Australia, is a sovereign country comprising the mainland of the Australian continent, the island of Tasmania, and numerous smaller islands. With an area of , Australia is the largest country by ...
and
New Zealand New Zealand ( mi, Aotearoa ) is an island country in the southwestern Pacific Ocean. It consists of two main landmasses—the North Island () and the South Island ()—and over 700 smaller islands. It is the sixth-largest island coun ...
. * Australia: Contenders include
Woolworths Woolworth, Woolworth's, or Woolworths may refer to: Businesses * F. W. Woolworth Company, the original US-based chain of "five and dime" (5¢ and 10¢) stores * Woolworths Group (United Kingdom), former operator of the Woolworths chain of shop ...
,
Myer Myer (stylised MYER, sometimes known as Myers) is an Australian mid-range to upscale department store chain. It trades in all Australian states and one of Australia's two self-governing territories. Myer retails a broad range of products ...
's MYER one program, the Priceline Club Card,
Amcal Allied Master Chemists of Australia Limited (Amcal) is an Australian pharmacy retailer and was founded by Major General C. H. Simpson on 13 July 1937, starting a movement that was to greatly influence pharmacy in Australia. The founding group ...
Club, Millers Retail Club, and the
BB Retail Capital Brett Blundy (born 1959/1960) is an Australian billionaire businessman. He is the founder and former chairman of BB Retail Capital, which owns companies such as Sanity Entertainment, Bras N Things, and Aventus Property Group. He is part-owner ...
Pulse Rewards program. * New Zealand: Other programs include the New Zealand Automobile Association AA Smartfuel programme and
Countdown A countdown is a sequence of backward counting to indicate the time remaining before an event is scheduled to occur. NASA commonly employs the terms "L-minus" and "T-minus" during the preparation for and anticipation of a rocket launch, and ev ...
supermarket's Onecard. Kachingo was a short-lived "card free" programme.


Mobile loyalty programs


Mobile online loyalty programs

There has been a move away from traditional magnetic card, stamp, or punchcard based schemes to online and mobile online loyalty programs. While these schemes vary, the common element is a push toward eradication of a traditional card, in favour of an electronic equivalent. The choice of medium is often a
QR code A QR code (an initialism for quick response code) is a type of matrix barcode (or two-dimensional barcode) invented in 1994 by the Japanese company Denso Wave. A barcode is a machine-readable optical label that can contain information about t ...
. Some prominent examples are Austrian based mobile-pocket established in 2009, the US-based Punchd (discontinued from June 2013,), which became part of
Google Google LLC () is an American Multinational corporation, multinational technology company focusing on Search Engine, search engine technology, online advertising, cloud computing, software, computer software, quantum computing, e-commerce, ar ...
in 2011. and an Australian-based loyalty card application called Stamp Me which incorporates iBeacon technology. Others, like Loopy Loyalty (HK), Loyalli (UK), Perka (US), and Whisqr Loyalty (CA), have offered similar programs. Passbook by Apple is the first attempt to standardize the format of mobile loyalty cards.


Mobile off-line loyalty programs

With the introduction of host card emulation (HCE) and near field communication (NFC) technology for mobile applications, traditional contactless smart cards for prepaid and loyalty programs are emulated in a smartphone.
Google Wallet Google Wallet (or simply Wallet) is a digital wallet platform developed by Google. It is available for the Android, Wear OS, and Fitbit OS operating systems, and was announced on May 11, 2022, at the 2022 Google I/O keynote. It began rol ...
adopted these technologies for mobile off-line payment applications. The major advantage of off-line over the online system is that the user's smartphone does not have to be online, and the transaction is fast. In addition, multiple emulated cards can be stored in a smartphone to support multi-merchant loyalty programs. Consequently, the user does not need to carry many physical cards anymore. The term also is used regarding linking rewards for online and offline purchases.


Disloyalty cards

In three cities, some independent coffee shops have set up experimental 'disloyalty card' programs, which reward customers for visiting a variety of coffee shops.


Criticism

Evidence for the effectiveness of loyalty programs is controversial. Many companies are unsure whether and how to use customer loyalty programs profitably. Many programs (regardless of location, size, or industry) are run without the appropriate metrics or target parameters. Some companies complain that loyalty programs discount goods to people who are buying goods anyway. Moreover, the expense of participating in these programs rarely generates a good return on investment. The Forte Consultancy Group regards loyalty programs as
bribes Bribery is the offering, giving, receiving, or soliciting of any item of value to influence the actions of an official, or other person, in charge of a public or legal duty. With regard to governmental operations, essentially, bribery is "Corru ...
. In the case of infrequent spenders, loyalty fees provide a means of subsidizing discounts. A 2015 study found that most supermarket loyalty cards in the United States do not offer any real value to their customers. Furthermore, commercial use of customers'
personal data Personal data, also known as personal information or personally identifiable information (PII), is any information related to an identifiable person. The abbreviation PII is widely accepted in the United States, but the phrase it abbreviates ha ...
– collected as part of loyalty programs – has the potential for abuse; it is highly likely that consumer purchases are tracked and used for
marketing research Marketing research is the systematic gathering, recording, and analysis of qualitative and quantitative data about issues relating to marketing products and services. The goal is to identify and assess how changing elements of the marketing mix i ...
to increase the efficiency of marketing and advertising, which is one of the purposes of offering the loyalty card. For some customers, participating in a loyalty program (even with a fake or anonymous card) funds activities that violate privacy. Consumers have also expressed concern about the integration of
RFID Radio-frequency identification (RFID) uses electromagnetic fields to automatically identify and track tags attached to objects. An RFID system consists of a tiny radio transponder, a radio receiver and transmitter. When triggered by an electromag ...
technology into loyalty-card systems. One may view loyalty and credit-card reward-plans as modern-day examples of kickbacks. Employees who need to buy something (such as an airline flight or a hotel room) for a
business trip Business travel is travel undertaken for work or business purposes, as opposed to other types of travel, such as for leisure purposes or regularly commuting Commuting is periodically recurring travel between one's place of residenc ...
, but who have discretion to decide which airline or hotel chain to use, have an incentive to choose the payment method that provides the most cash-back, credit-card rewards or loyalty points instead of minimizing costs for their employer.


See also

* Geomarketing * Identity management *
Incentive In general, incentives are anything that persuade a person to alter their behaviour. It is emphasised that incentives matter by the basic law of economists and the laws of behaviour, which state that higher incentives amount to greater levels of ...
*
Incentive program An incentive program is a formal scheme used to promote or encourage specific actions or behavior by a specific group of people during a defined period of time. Incentive programs are particularly used in business management to motivate employees ...
*
Loyalty marketing Loyalty marketing is an approach to marketing, based on strategic management, in which a company focuses on growing and retaining existing customers through incentives. Branding, product marketing, and loyalty marketing all form part of the cu ...
*
Premium (marketing) In marketing, premiums are promotional items — toys, collectables, souvenirs and household products — that are linked to a product, and often require proofs of purchase such as box tops or tokens to acquire. The consumer generally has to pa ...
, e.g., "premiums" * S&H Green Stamps * Trading stamp


References

{{DEFAULTSORT:Loyalty Program Pricing Nudge theory