The payment card industry is becoming ever more competitive due to substantial growth in challenger banks. This means that trying to get prospective customers' attention is becoming increasingly challenging. This is happening alongside the constant battle for customers' share of wallet.
One solution to strengthen your value proposition is using card-linking technology to offer loyalty programmes and rewards.
Card-linking helps you to enhance the relationship a customer has with their payment card as their card becomes an intrinsic part of their daily behaviours. By creating a friction-free, seamless experience, users can easily use loyalty programmes, removing the need for plastic loyalty cards.
With 40% of UK consumers finding carrying loyalty cards to be an inconvenience, you’ll quickly realise that many would be happy to join your business because then they only have to worry about using one card to earn rewards, and conveniently that card is their payment card.
What is your value proposition?
With the emergence of Fintech companies, financial institutions are under threat to strengthen their customer offerings beyond the financial scope. Younger generations (gen Z), have been raised under the roof of personalisation. They expect relevant, engaging messages and offers that suit their interests - not generic, random value propositions.
What do you currently offer to draw in and retain customers? Both US Bank and AMEX have tried to cover all bases, hoping to peak the interests and daily activities of their customers.
The US Bank Altitude Go Card advertises their welcome offer where you can earn 25,000 worth $250 when you spend $1,000 within the first 90 days of account opening.
You can earn 4x points from food delivery, takeout and dining, and 2x points at grocery stores, gas stations and streaming services. They also give you $15 credit for annual streaming platform purchases such as Netflix/Spotify.
AMEX offers a range of reward and cashback cards.
Their cashback credit cards allow you to earn 5% cashback up to £125 for the first 6 months of account opening. What also strengthens their value proposition is that they offer supplementary cards for a relative or partner, meaning their spending will count towards your cashback total.
Their Reward credit card has a welcome offer where new members can earn 5,000 points if they spend £2,000 in their first 90 days. For every £1 spent, 1 point is earned. You can then redeem your points at their partners, which includes Amazon, Boots and Currys PC World.
Why you should take personalisation further
You might be thinking that your approach is already quite personalised but as every brand around us is trying to do the same thing, it’s important to stand out in your methods of personalisation.
Therefore, personalisation has to be taken further to really connect with your customers and improve their experience.
What is the value of a card beyond its obvious utility as a payment method?
AMEX and US Bank target the daily behaviours of their consumers with rewards at brands such as Amazon as they understand the interests of their customers.
Why do customers come to your business? What do you offer that aligns with their needs and is there a way you can enhance this through rewards?
Focus on what makes you unique and utilise the data you currently have on customers to strengthen your value proposition and create great offers through card-linking technology.
Creating personalised rewards may seem like it’d be time-consuming, and rightly so if you're trying to do it any other way. But with card-linking, all frictions are removed. It actually creates a smoother user experience as it asks for minimal effort from customers.
Once a user links their card, you’re given permission to access personal data about how their money is spent in regards to your services, and in return, you’re able to pump out personalised experiences and offers to keep them incentivised.
At LUX, we use card-linking technology to make our rewards scheme seamless and incentivising as we‘re able to create the right offers for customers at the right time. This is important to LUX as we’re all about customer loyalty - users use LUX to gain points worth up to 10% of their bill at high-end restaurants, which can then be spent on rewards. For LUX to flourish, users must dine again and gain more points. By being able to target them with the right information, we can change consumer behaviour to ensure this happens.
As 75% of customers are happy to share personal data for personalised offers and rewards, card-linking technology can be seen to be a perfect route to strengthen your value proposition and drive your lifetime value.
How to strengthen your value proposition
You'll see many banks strengthening their value proposition with companies such as Amazon, Netflix, Uber etc. - this is obviously a well-known tactic as I'm yet to know someone who hasn't used these services at least once, but are they luxurious enough and are they unique?
The answer is no.
So what can you offer alongside or instead of, to really grab your prospective customers' attention and compete for share of wallet with challenging banks like AMEX?
You can integrate LUX into your card offerings.
By offering LUX, your customers gain free access to our membership app and will be able to earn up to 10% of their restaurant spend back in reward points. These points can then be spent on over 100 luxury rewards.
And with over 300 hand-picked, high-quality restaurants, bars, cafes and pubs across the UK, only the finest experience is promised.
Our premium rewards scheme will strengthen the relationship between your customers and their payment card as they must continue dining to be able to earn our rewards. And as we only partner with high-end restaurants, we're sure to bring the luxury to your value proposition.
If you're interested in knowing more about LUX or card-linking, please email email@example.com