Survey finds loyalty and gift card programs drive sales
August 01, 2013

Consumers look toward their favorite retailer's loyalty and gift card program to save money. According to a recent survey, the majority of businesses offer a loyalty program and are continually looking for ways to make their consumers feel valued and appreciated. Small and medium-sized businesses that accept credit card payments and have gift card programs may see consumers use their physical loyalty card at the point of sale while asking for digital coupons or mobile vouchers.

Physical plastic is rewarding for customers
While many loyalty and gift card programs integrate mobile technology or utilize digital advertising and rewards, a recent study from SVM, an incentive solutions provider, found many consumers still value using a card rather than their smartphone to participate in loyalty programs. Eighty-seven percent of the survey's business respondents reported they provide gift cards as part of their loyalty programs, and 84 percent of consumers said they prefer having a physical card rather than an electronic one.

The survey also found that the main challenges for retailers for loyalty initiatives are cost, measurement of rewards and perceived value. However, providing customers with physical cards linked to a loyalty program can not only attract new customers and generate additional business for SMBs, but can also help shoppers accumulate points and gain access to special discounts, increasing the value of the program. 

According to the study, the most important aspect of an incentive initiative is making customers feel valued by the company. When consumers perceive their loyalty is essential to the retailer, they are more likely to participate in the program and reach for their card as well as spend more at the business. Generating sales is a central reason many SMBs invest in loyalty and gift card programs, and driving sales depends on showing the customer that his or her business is important.

Many SMBs are beginning to integrate mobile marketing and invest in on-the-go payments to drive consumers to their stores, but including digital coupons can also be a great way to produce sales. However, balancing digital offers for loyalty program participants with rewards for using physical cards is important. According to Mobile Marketing Watch, online advertising measures can be valuable for driving customers to use their loyalty program cards or offers, but companies should remember the importance of physically swiping a card for consumer satisfaction. 

Nexus: G-WEBCD6