Loyalty and rewards is the part of marketing technology that pays customers to come back. It covers points for every purchase, tiers that bring bigger discounts, and gift cards for referring a friend. It also covers what the loyalty programme leaves behind: a record of who bought what, basket by basket.
The idea appears in many places. An airline gives miles for each flight. A supermarket gives regular customers a lower price. A credit card gives reward points for spending. A company gives gift vouchers to the dealers who sell the most of its products, and to its own employees.
The zone has three products. Loyalty programme software runs the programme itself. It records the points each member earns and spends, moves members up or down tiers, and sends offers to each member. Points earned in one programme can sometimes be spent in another, through a loyalty points exchange. Points of this kind are a form of virtual currency: they have value, but they can be spent only where the programme allows.
Retail media and customer analytics reads the baskets that a loyalty card records. A retailer uses this analysis to set its prices and promotions, and to decide which products each store stocks. It also sells brands the chance to advertise to its own shoppers, inside the retailer's app and website.
A rewards and incentives platform supplies the rewards. It offers one catalogue of gift cards, experiences and cash payouts. A company uses it to reward its customers, its channel partners and its employees.
Here is why loyalty has become a data business. Consider a shopper who pays at a supermarket in Bhubaneswar by UPI or in cash. Without a loyalty card, the supermarket knows what was sold, but not who bought it. When she gives her phone number at the billing counter, each basket is linked to her. Over a year, the supermarket learns how often she shops, what she buys and when she switches brands. This is first-party data, which the retailer collected itself. It is often the most reliable record a retailer has of its customers, and it is the basis of the work done in this zone.