Loyalty Cards

Loyalty cards are tools, either physical or digital, used by businesses to identify members of their customer loyalty program and track their activity. Historically, these took the form of physical plastic cards with a magnetic stripe or barcode, or even simple paper punch cards. When a customer makes a purchase, they present their card to be scanned, which links the transaction to their account, allowing them to accumulate points and redeem rewards. The primary function of a loyalty card is to serve as a unique identifier, bridging the gap between a customer’s in-store actions and their profile within the brand’s loyalty system.

In the age of e-commerce, the concept of a loyalty card has evolved significantly. While physical cards are still used in brick-and-mortar retail, their relevance online has diminished in favor of more seamless “cardless” systems. In a cardless loyalty program, a customer’s account is tied to their email address or phone number, eliminating the need to remember or carry a physical object. The modern digital equivalent is the mobile wallet pass, where a customer can store their loyalty card in their smartphone’s wallet (like Apple Wallet or Google Pay). This provides the convenience of a digital card for in-store use while maintaining the effortless, account-based experience online.

Loyalty Cards FAQs

What are loyalty cards?

A loyalty card is a physical or digital card that identifies a customer as a member of a brand’s rewards program, allowing them to earn points and access benefits.

How do loyalty cards work?

Loyalty cards work by being scanned or presented at the point of purchase, which links the transaction to the customer’s loyalty account to track their spending and accumulate rewards.

Are physical loyalty cards still relevant for e-commerce?

Physical loyalty cards are largely irrelevant for pure-play e-commerce, where loyalty is tied directly to a customer’s online account, making the experience “cardless” and seamless.

What is a digital loyalty card?

A digital loyalty card is a virtual version of a physical card that is stored in a customer’s smartphone wallet, which can be scanned in-store and often displays their current points balance.

What are the benefits of a cardless loyalty program?

The benefits of a cardless loyalty program include improved customer convenience (nothing to carry or lose), easier signup, and seamless tracking of purchases across online and in-store channels.

How do businesses track loyalty without a card?

Businesses track loyalty without a card by linking program membership to a unique customer identifier, such as an email address or phone number, which customers use to log in to their online account.