How Does Having A Loyalty Card Benefit The Customer & The Business?

May 26th, 2021 | Gift & Loyalty

Customer loyalty is one of the biggest elements that contributes to the success of your business. Customer retention is up to 5 times less expensive than marketing to gain new customers, so it’s worth building up the loyalty you see from your regular customer base. The customer loyalty ladder theory can help you increase customer loyalty, but it’s also important to implement other strategies such as customer loyalty schemes.

The benefits of having a customer loyalty scheme may seem obvious, but there’s more advantages than meets the eye. The main reason that businesses invest in a loyalty card reward programme is because it’s a solid strategy to increase your customer retention. It works because customers love to know their loyalty will be rewarded. It’s important to recognise the other benefits it has, however, for both businesses and customers.

Benefits Of Loyalty Cards For Businesses

  1.     Helps Customer Retention

Retaining customers is crucial to your business growing and becoming a success. This means you need to create some strategies to make sure your customers keep coming back for more after their first visit. By the time they make a purchase, customers trust you, so afterwards you need to increase that trust and help create a loyal relationship  that customers can have with your brand.

Signing a customer up to your customer loyalty scheme encourages them to return and make more purchases, giving you a chance to build on trust even further.

  1.     Increases Profits

Studies show that customers who are members of loyalty schemes within a business spend between 5% and 20% more than non-members, and loyalty programmes can increase overall revenue by 5-10%.

It’s not all down to loyalty schemes, though ­- increasing the customer retention your business sees can boost revenue massively, as a 5% increase in customer retention can increase the profits of your business between 25% and 95%.

  1.     Autonomous System

After the initial set up, your loyalty scheme won’t require much effort from you or your staff to run. Once your loyalty cards are designed, printed, and in your hands, all you need to do is offer them to your customers when they come through your shop – and, of course, stock up on your loyalty cards before you run out.

You can tweak your loyalty card reward programme after you’ve set it up but it’s unlikely that you’ll need to, so all you need to do is scan your customers’ cards when they make purchases. Other than that, your loyalty system will handle everything else.

  1.     Get An Edge Over Your Competitors

There are likely several businesses in your local area with the same offerings as you. You need to stand out to customers and give them a reason to visit you over your competitors, and then encourage them to stay instead of defecting to someone else.

Having and advertising a customer loyalty scheme encourages your consumers to shop with you over your competitors. Enrolling a customer onto your loyalty scheme means they’re less likely to go somewhere else as they’re already collecting loyalty points with you.

  1.     Continuous Improvement

Your loyalty system collects information so you can generate reports on a range of topics, including:

  •       Point transactions
  •       Best customers based on visits
  •       Best customers based on points saved
  •       Best customers based on points redeemed
  •       Transactions

And much more. Using this information can allow you to tweak and improve several different elements of your business plan to generate better results. Implementing a loyalty scheme allows you to identify opportunities where your business can grow.

CR80 card and fob loyalty card

Benefits Of Loyalty Cards For Customers

  1.     Getting A Better Deal With Rewards They Want

One of the biggest reasons that customers join a loyalty scheme is that they feel when shopping with a certain business they’re getting a better deal. Getting a reward or a discount with loyalty schemes makes customers feel like they’re getting more for their money.

It also helps if your customers are working towards rewards that they want. If your loyalty scheme is designed well, you should know exactly what your target audience wants. Make sure that your rewards are aligned with what your customers want so they want to  earn loyalty points.

  1.     Loyalty Is Rewarded With Low Effort

Consumers actively seek out shops that have loyalty reward schemes in place. 83% of customers are more likely to choose a business with a loyalty scheme in place over one that doesn’t. The average UK shopper holds and regularly uses three loyalty cards.

What makes loyalty schemes so popular? Customers like to be rewarded for doing actions they see as low effort. Consumers prefer experiences that are low effort, and loyalty card transactions are just that – they’re likely going to make the purchase anyway, so all they need to do is bring their loyalty card with them when they shop with you. It’s as simple as that.

  1.     Instant Rewards

Customers who have signed up to your loyalty scheme will spend more and spend more frequently so that they reach their rewards quicker. Gaining loyalty points is instant gratification, as the points are loaded onto the customer’s account as soon as the transaction is complete. They can see their loyalty being rewarded in real-time.


Learn more about how a loyalty rewards system can benefit your business and your customers or contact one of our experts today on 020 8266 1600.

Written by Lucy Wenham

Lucy is a customer loyalty expert, with experience in loyalty schemes for small independent stores, right through to our town and city-wide loyalty schemes.

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