The customer loyalty space has evolved over the last few years from predominantly coupon driven rewards to including card-linking offers (CLO) embraced by the online-to-offline (O2O) industry. Card-linked offers enable consumers to receive a discount or cash back automatically when they pay with a debit or credit card that has been linked to an offer. Increasingly large national brands and SMBs are adopting the card-linking approach to connect online offers with in-store purchases.
From Coupon Clipping to Card-Linking
Promo codes, paper and digital coupons have been moderately successful at increasing sales and average order value. They have been a tried vehicle for generating brand loyalty and improving overall revenue. However, the benefits of card-linking is that it’s completely hassle-free. Customers do not have to cut or print coupons. There is no need to load coupon apps to get the rewards and the consumer does not have to mail-in rebates. With card-linking you are still getting all of the incredible benefits of coupons but it’s an effortless process for the customer at checkout. Consumers just link their credit or debit card with a publisher that promotes the offer, and they get automatic cash back when they pay at the store without the retailer needing to jump through any integration hoops. Card-linking successfully answers consumer’s coupon concerns…
If you weren't paying close attention you may have missed that some of the largest websites and apps on the planet have launched or are working on card linked programs from Facebook to Uber to Microsoft. We here at Empyr power many of these programs and are happy to announce a handful of new partnerships. Before I announce them I'd like to take a moment to explain why card linked programs are hitting critical mass.
So why all the fuss around card linking? It comes down to a simple premise, websites and apps are constantly searching for the best way to monetize their user base without detracting from the great user experience they provide which got them the users in the first place. Card linked programs do exactly that, they help provide a new revenue stream and they provide a new frictionless benefit to users that make them more engaged and loyal.
Let me explain how it works. Websites and apps are using Empyr's API to give their users access to offline offers like 10% cash back at a restaurant. To get the offer consumers link up any credit or debit card to the website/app (using Empyr's API) and the consumer simply pays with that card. Instantly the consumer earns cash back or points and the website/app earns a commission on the sale, both paid by the merchant in return for the customer they received.
"One of the great ironies about the mobile revolution has been that while digital ad impressions are easy to track, using that data to determine mobile ads’ efficacy has proven a challenge. Many brand marketers are still left wondering how much retail lift the ads actually achieve — and as a result they are perhaps a little more conservative with their budgets than if they could see the direct relationship. A number of companies in the local space have spent the last couple of years working on this attribution problem, and some believe their efforts are starting to come to fruition."
The unfulfilled promises of online to offline have left us all a bit deflated. It seemed like such a perfect fit, everyone is online and 93% of commerce is still offline, just connect the two worlds and a massive O2O industry will be born! We've heard this message at every conference since Hootie and the Blowfish were actually popular. So why hasn't this taken off; what's the holdup?
In order to understand what has gone wrong you have to understand the three core elements that need to be done right in order to create a massive O2O industry.
- The Offer - Something that motivates consumers to make a purchase at an offline business.
- The Tracking - How the consumer redeems the offer and how the offline business tracks where it originated from.
- The Monetization - How online companies make money by driving consumers to offline businesses.
