CandyBar.co Blog

Loyalty Card Apps: How Small Businesses Can Boost Customer Retention

Darren Foong

So you’ve heard about loyalty card apps. Maybe your customers have asked if you give out loyalty rewards. Or maybe enough customers have asked about a loyalty program, but you’re wondering whether to do it with paper stamps or if you have to create an app from scratch.

Well don’t sweat it, we’ve got you covered.

After going through this piece you’ll know all there is to know about loyalty card apps and how they work.

Let’s dive in.

CandyBar's Guide to Loyalty Card Apps, Loyalty Card Wallets and Digital Loyalty Cards

 

What is a Loyalty Card App?

A loyalty card app is either of these 3:

  1. Loyalty Card Wallets: These are apps for consumers to store multiple physical loyalty cards digitally
  2. Digital Loyalty Cards / Mobile Loyalty Programs: These are apps for consumers from a single brand/business that replace physical cards
  3. Loyalty Card App: These are apps for small businesses to run digital loyalty programs

What is a Loyalty Card Wallet/App?

A loyalty wallet is an app that allows you to create or store multiple traditional physical loyalty cards digitally.

The idea behind this solution is that you don’t have to walk around with multiple paper cards in your physical wallet, for example, if you get physical loyalty cards from Walgreens, Best Buy, and Target.

You just need to upload the cards into the loyalty card wallet to store them digitally and in one place.

However, it has some disadvantages. For one, some locations have older devices that don’t work with loyalty wallet apps. The scanners may not be able to identify the card’s barcode on your mobile device’s screen.

However, many brands like Woolworths supermarkets have created loyalty programs that introduced better uploading methods using Google Pay and Apple Wallets to curb this problem. .

Woolworths Supermarkets switched from a card to a  loyalty program app.

What are the Best Loyalty Card Wallet Apps for all my Loyalty Cards?

1. Stocard – Mobile Loyalty Card Wallet

Stocard is amongst the leading loyalty card wallet apps available.

With Stocard, you can store all your physical loyalty cards digitally in one location. So when you’re out shopping, you can scan the respective store’s loyalty card barcode from your mobile device.

The app also permits you to browse discounts, coupons, circulars, and flyers.

2. Key Ring – Savings, Store Cards, Deals and More

Key Ring’s app makes storing traditional loyalty cards simpler.

Using the Key Ring app, you can keep all your loyalty cards on your phone. You’ll just need to scan the barcodes from your device when you get to the store.

Like Stocard, Key Ring app also lets  you search for circulars, weekly ads, and coupons on your smartphone..

3. Apple Wallet – Apple Card and More

The  Apple Wallet loyalty card wallet app

For all iPhone users, the Apple Wallet is a stellar option. This loyalty card wallet app goes way beyond storing reward cards and coupons.

The Apple Wallet can store all your movie tickets, debit, credit, and prepaid cards. Even boarding passes and student IDs. It also works on the Apple Watch, too!

What is a Digital Loyalty Card?

A digital loyalty card or mobile loyalty program is a brand-specific loyalty card app tailored for consumers to replace physical or traditional paper cards.

There are so many digital loyalty cards out there and we’ll be looking at a few to drive home the point; specifically, retailers who evolved their loyalty cards into app.

What are the Best Digital Loyalty Cards?

1. Starbucks Mobile App – Rewards and Stars

Starbucks Rewards is a billion-dollar loyalty program

The Starbucks Rewards loyalty program is the most well known and successful loyalty card app. The loyalty card app is a digital version of their plastic coffee loyalty card.

The Starbucks Rewards app stands as a case study for why businesses should run their own loyalty program and build their own app. In fact, In 2016, Market Watch reported that Starbucks had more cash in their loyalty card/app than some banks..

The Starbucks digital loyalty card program is a billion-dollar one. And as of march 2019 they had a whopping 16 million active users of their digital loyalty card app. Starbucks Reward is an example of a Tiered loyalty rewards program

2. Sephora Beauty Insider

Sephora Beauty Insider digital loyalty card

With a net worth of over $37.2 billion, they tag the secret of their success to the Sephora Beauty Insider digital loyalty card, which used to be a physical card as well.

Their mobile loyalty program offers tiered rewards dependent on the customer’s spend. And gives their customers great rewards like full product gifts to keep them engaged.

With 25 million members and counting Sephora’s digital loyalty card program is one to emulate.. They offer customers unique birthday loyalty rewards and also use in-app quizzes to identify customer behavior for personalized product recommendations.

Customers are also incentivized to join or upgrade their tiers via perks like free beauty classes and rewards.

3. Marriott Bonvoy – Benefits for Stay, Rewards Reimagined

Marriott Bonvoy mobile loyalty program

Like most examples of hotel loyalty programs, Marriott Bonvoy mobile loyalty program is separated into tiers depending on the number of night’s customers spend at Marriott properties all year round.

After a customer stays in a Marriott property for 10 nights in a year, they’ll hit the first tier – then the perks and rewards rise (think late check-outs and points bonuses).

The Marriott Bonvoy mobile loyalty program is the world’s largest hotel loyalty program. And offers huge rewards options (over 7,000 properties to redeem points on) like no other as it’s a combination of  the old Marriott rewards program,the Ritz-Carlton rewards and the Starwood Preferred Guest reward program

What is a Loyalty Card App for Small Businesses?

A loyalty card app provides small businesses with a platform to manage and run their digital loyalty program.

Merchants get to provide customers with various offers and rewards, in exchange for  more data about customer activity and foot traffic.

In recent years, a lot of brands have gravitated towards using a loyalty card app, because consumers are more comfortable with smartphones and apps than with physical paper cards.

Most merchants using loyalty card apps for small businesses give simple offers, like punch-card style mechanics: buy 5 coffees and get 1 free style. Some loyalty apps require customers to download a rewards app, while others store a virtual card via SMS or mobile number.

 57% of consumers would engage with a loyalty program using a mobile device Via BondBrandLoyalty (PDF)

What are examples of Small Businesses using a Loyalty Card App?

It’s not just the big brands offering loyalty card apps. Here are some examples of small businesses offer loyalty card programs:

If you’re looking for more, check out our list of Small Business Loyalty Program Examples.

What are the Best Digital Loyalty Apps?

A digital loyalty app helps businesses to run a loyalty program virtually without the limitations of a traditional paper loyalty card.

So let’s see the best digital loyalty apps for your brand:

1. Fivestars

The Fivestars loyalty app requires customers to input a small amount of data during sign-up via an on-site device. The details required could be the date of birth, phone number, etc.

After this, the customer would be able to “check-in” whenever they visit your business by typing in their phone digits. And will receive personalized promotions or birthday rewards via SMS.

2. CandyBar

CandyBar is unique as there is no need for POS integration or an actual app – all you need to do is set up a device or tablet with the CandyBar login page at the counter.

After the customer signs up with their details, they input their phone digits whenever they visit your business, receive points, and redeem rewards.

How do you make a Loyalty Card App?

When it comes to making a loyalty card app, there are various ways to go about it.

The best option for you depends on certain factors like your business type, customer demographics, loyalty program goals, and the time and money you intend to invest in the app.

1. Use a Loyalty App Provider

It’s easy for your business to create and manage a digital loyalty program using a loyalty app provider.

App development is complicated, and can quickly consume time and money. If you’re a small business, you may simply want to pay an app provider for their service.

2. Build your Own App

Building your own loyalty card app can either be done by hiring a developer or agency to develop the app according to your specifications and manage it.

This would involve enormous costs to both create and keep the app running. If you’re a small business just starting, this isn’t recommended.

3. Use the Loyalty Module on your POS

If the manufacturers of your Point-of-Sales (POS) system offer a loyalty module, consider using it for your loyalty program.

On the one hand, the loyalty system integrates directly with your POS, making it easy to calculate rewards and costs. The flip side is that some attached loyalty modules can be basic and lacking in the features you are looking for.

Depending on your POS system provider, the cost of these modules may also vary from $0 to over $500 annually.

Why Use a Loyalty Card App for your Business?

If you’re still undecided on whether to use a loyalty card app for your business, or stick with paper, here a few reasons for you to consider:

1. Loyalty Card Apps are Easier to Manage and Track than Paper

There’s no effective way to track redemptions with a paper card – your cashier will have to take notes while issuing stamps and rewards.

Meanwhile, loyalty card apps compile the data in dashboards for your use. Plus, you get to track employee performance — which employees get the most new sign-ups?

That can be valuable data if you want to reward your staff.

2. Paper cards are Easily Recognizable and usable by everyone

Everyone knows what they are, including your customers.

So you won’t need much of an onboarding process. This means you’ll get more people to pick up the card as there is a minimal barrier to entry.

3. Loyalty card apps let you Stay in Touch with Customers via Push/Messaging

Customer engagement and loyalty go hand in hand. And with a loyalty card app, you get to stay in touch with your customers via perfectly timed messages using push notifications and SMS messaging.

4. You can’t update Paper Cards, change the Reward, or send reminder emails

Traditional loyalty cards are created to be streamlined. So customers can’t have diverse ways to earn rewards or redeem them.

A customer would have to buy the same item over and over, plus have just one reward option.

5. Customers Can’t Misplace your App

43% of customers say that physical cards are their biggest barrier to redeeming rewards. Physical cards are bulky to carry around and easily lost.

Instead, 71% of customers are likely to use a loyalty card if it’s on their phone.

The biggest problem isn’t your customers losing their phone – its your loyalty app getting lost in a sea of other loyalty apps on their phones.

How to Replace Loyalty Cards with an App?

The process to replace your physical cards with a loyalty card app is simple:

  1. Subscribe to a loyalty card app service or create one.
  2. Start promoting your new program to loyal customers. The best way is with signages in your actual store, and announcement on your socials.
  3. Train your staff and cashiers to remind customers to switch from paper cards to apps. You might even offer them a trade-in bonus, to let them keep the stamps or rewards accumulated.

Digital Loyalty Cards, Loyalty Card Wallets and Loyalty Card App Platforms

There you have it.

Loyalty card apps are essential to building a successful and loyal customer base. Loyalty apps appeal to customers a lot more than traditional cards. And they are more useful to your business.

If you’re interested in boosting your word-of-mouth marketing strategy, check out ReferralCandy and InfluencerCandy!