Booming bonuses: card-based customer loyalty programmes on the rise

Booming bonuses: card-based customer loyalty programmes on the rise

The elimination of Germany's rebate law and bonus ordinance will give rise to a veritable boom in card-based customer loyalty systems in retail. Bright prospects for card manufacturers, terminal providers, network operators, system outfitters and direct marketing companies! EuroShop, the world's largest fair for investments in retail, is right in tune with the times: From 23 to 27 February 2002, numerous international companies will feature innovative systems, products and trends surrounding customer cards as part of the fair's EuroCIS segment. The EHI – EuroHandelsinstitut's latest study fully confirms this boom, revealing that three-fourths of all retailers plan to establish expand card-based customer relationship management in the wake of new legislation.

Bonus point programmes, company-specific or otherwise (such as the popular "Payback" system) are leading the pack. Regardless of company size, retail companies throughout Germany are anticipating their own cards to bring in higher sales.

Marketing measures tailored to target groups and the individual customer, however, require a high-performance data processing infrastructure. High attendance figures from EHI's congresses on database marketing and data warehousing demonstrate that, clearly, retailers are eager to get in on the trend. As before, the retail industry will have to make considerable investments: A study conducted by EHI in 2000 discovered that just 50% of Germany's retailers use data warehouse systems. Suppliers of direct marketing solutions in particular are faced with considerable challenges , technical and otherwise, regarding target-group focused retail campaigns. More than ever, unique and clever ideas are called for.

But 'paying by plastic' remains a tricky topic. Financial institutions place value on brand identity, which will replace Europe's standard-issue ec-card with individual bank cards. This makes security an even hotter topic for discussion between retail and banks. Over the medium-term, new standards and international rules and regulations will require the creation of chip-supported systems. The international retail community, for its part, can gain some valuable insights into this sensitive topic at EuroShop 2002 in Düsseldorf.