What Is a Loyalty Card?

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Many retailers, including CVS, Office Max, Barnes & Noble, Toys 'R' Us and Kroger, offer customer loyalty cards that give benefits to their customers. Loyalty cards differ from membership cards required by retailers like Sam's Club or Costco for entrance to their stores. Customers wishing to sign up for a loyalty card are typically required to provide information such as name, address and phone numbers. While most cards are scanned at the register, some less high-tech companies apply a discount upon sight of the card.

Functions

  • Retailers "use the cards to keep tabs on what you purchase, how often you shop, and what your buying preferences are," according to an article in Consumer Affairs. Based on those consumer preferences, many retailers will send out mailings to their customers, encouraging future shopping trips and providing discounts.

Types

  • Most retailers offer customers one of two types of cards: a credit-card size card to be placed in a wallet or purse or a tag that's placed on a key ring. Both loyalty cards have a customer number recognized by the computer system.

Benefits

  • Since Kroger grocery store doesn't require a membership card to shop in its stores, deal-seeking shoppers should obtain a card to reap the most benefits. Using the card ensures the lowest price on items and also allows for certain coupons to be doubled. Kroger has a program in which customers can accrue one point for every $1 spent in the store. Points can be redeemed for discounted gasoline sales at Kroger stations. Additionally, by using a Kroger card, customers can "receive coupons selected just for you from Kroger and your favorite brands, giving you exclusive and unique ways to bring home the products you enjoy," according to the company.
    A new feature available to bargain shoppers is e-coupons that can be loaded directly onto a card. A benefit of shopping with e-coupons is not having to fumble with paper coupons at the registers. E-coupons discounts are taken off the total when the card is scanned. There are several e-coupon websites around, however www.Cellfire.com, www.shortcuts.com and www.pgesaver.com are a few of the more popular ones.

Features

  • While most retailers would prefer that you carry their card on yourself at all times, many allow you to use your phone number as an alternate account number.
    A bonus feature of carrying a card is that retailers can place the customer on a mailing list. Mailing lists often include exclusive coupons for favored customers or sneak-peaks at upcoming sales or events.
    Most grocery store and bookstore cards apply a discount instantly at the register. However some cards, such as those for CVS and Office Max, offer a benefit in the future, typically at the end of the quarter. CVS' "Extra Care Bucks" program returns 2 percent from certain purchases to the consumer, providing what is essentially a gift certificate to the customer.

Considerations

  • Some consumers suggest that customer loyalty cards are an invasion of privacy because they track every purchase made and can compile a list of purchases to external marketing firms. The obvious choice is to forgo using loyalty cards. As blogger Jane Hauntanen explains, "Now people will know [I] bought a roll of dental floss at 7:49 PM at CVS and paid two dollars for it. That is an invasion of my privacy. Of course if it bothered me that much, I could just pay cash and forget about the savings."

References

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