Attract New Customers and Increase Loyalty with Payment-Linked Offers

A recent study by PYMNTS found that “79% of consumers have established some form of commerce relationship with the brands they purchase from—a membership, a retail subscription or a loyalty program—and 17% of consumers have all three types.

”Even better, 95% of consumers who participate in rewards programs—and feel close to those brands—state they will purchase more products from them. Ultimately, consumers reward businesses that reward them by spending more.

Now let’s look at how payment-linked offers (also known as card-linked offers or CLOs) make rewarding customers even easier.

The transformative power of payment-linked offers

At its core, payment-linked offers (PLOs) use past purchase data to create targeted, relevant offers to potential customers through a mobile or online banking application. In fact, PLOs are revolutionizing rewards programs by seamlessly integrating them with your customer’s preferred payment methods and tailoring rewards at the point of sale.

Unlike traditional rewards programs, payment-linked offers operate within existing payment infrastructures. This means no new apps or devices are needed. Instead, customers simply link their debit, credit, or charge cards through the card issuer or third-party provider and use this card to shop as usual at participating merchants.

The beauty of PLOs lies in their personalization

Payment-linked offers are intelligently curated based on each shopper’s purchasing history. This ensures customers receive rewards that truly resonate with their interests and preferences. From automatic discounts to cash rebates and rewards points, PLOs enhance the shopping experience while rewarding customers for their engagement.

In the 2023 holiday shopping season, nearly two-thirds of cardholders used payment-linked offers—and more than 50% of cardholders were interested in switching to merchants that provided product-specific PLOs, making them a smart way for merchants to engage today’s shoppers.

Here’s why PLOs are a win-win for everyone involved: 

• Retailers attract new customers and engage and retain current customers by providing delightful customer experiences
• Card issuers benefit from higher card usage, fostering stronger engagement among users who actively seek out and engage with new rewards
• Consumers unlock a treasure trove of special offers, enriching their shopping experiences with exclusive discounts and incentives tailored to their preferences.

This symbiotic relationship fuels the expansion of payment-linked offers, creating a dynamic ecosystem where businesses thrive and customers reap the rewards.

PLOs empower retailers with data-driven insights

Payment-linked offers provide businesses with invaluable access to customer purchase records, unveiling the effectiveness of rewards and offers. By understanding shopping trends, preferences, and patterns, businesses gain the ability to tailor special offers, craft targeted marketing campaigns, and innovate products that resonate with their audience.

Harnessing insights on buying frequency, location, and preferences empowers businesses to make data-driven decisions, engaging target customers more effectively and driving higher sales. What’s more, nearly 63 million consumers were highly interested in using PLOs, giving merchants and card issuers with appealing offers a competitive edge.

PLOs reduce invasive digital advertising tactics

Payment-linked offers provide a non-intrusive marketing approach, eliminating the need for third-party cookies and invasive tactics. Shoppers can now seamlessly engage with PLOs through familiar channels like mobile banking apps or banking websites—with no extra downloads or setups required.

This user-friendly marketing method is warmly embraced by shoppers, ensuring businesses maximize returns on their marketing investments. By embracing the power of PLOs, merchants can use third-party transaction data to help enrich a first-party-based view of their customers—while still protecting their privacy.

Specifically, payment-linked technology uses robust security measures such as tokenization and encryption to protect sensitive consumer information and reassure card users that their data is kept safe. This data is also anonymized, meaning no one can access the purchasing history of a particular shopper. These significant data security measures allow merchants, retailers, and financial institutions to prevent personal consumer data from being lost or stolen.

PLOs offer cookie-free personalization

As consumers grow increasingly wary of privacy-invading third-party cookies, payment-linked offers are a game-changer. Merchants can gather valuable data without relying on these intrusive cookies, ensuring a more privacy-friendly approach. 

Since PLOs operate within established payment channels, they prioritize data privacy and security. Now customers will have control over their data and be able to choose whether to participate in offers without compromising their privacy.

In this cookieless world, payment-linked offers become the beacon of personalized marketing, giving marketers the edge they need in an evolving landscape while protecting consumers’ valuable data.

PLOs bridge the gap between online offers and in-store transactions

With payment-linked offers, shoppers can use their linked cards to pay online and in brick-and-mortar stores. This means businesses that incorporate PLOs into their omnichannel marketing strategy can deliver a more integrated customer experience across all touchpoints. 

The simplicity and ease of redeeming the discounts fosters a positive shopping experience, encouraging customers to frequent participating merchants more often. 

When customers repeatedly visit a merchant and receive more personalized offers, this cultivates an even deeper sense of appreciation and loyalty, incentivizing shoppers to keep returning. 

A business with a payments-linked rewards program has a competitive advantage over a company that does not have one. According to YouGov survey, most US consumers prefer brands that have loyalty programs, especially if the offers are personalized:

PLOs make shopping and saving easy

With payment-linked offers, shoppers don’t need to clip paper coupons, search for promo codes, carry multiple loyalty cards, or register their emails or phone numbers for each business’s rewards program. Instead, both earning and redeeming rewards are simplified. Payment-linking technology also gives shoppers access to a huge network of deals from a single app whereas a paper coupon or a digital promo code limits customers to a single business. 

Deals are available from many retailers, restaurants, and brands, so consumers can find offers that align with their current needs. They can participate in relevant rewards without having to alter their spending plans to get rewarded for a purchase.

Ultimately, payment-linked offers reward everyone

Payment-linked offers are the ultimate win-win. Tailored to each card user based on their spending history and location, PLOs grant immediate access to personalized rewards. Some payment-linked programs even extend travel incentives, like earning miles for flights or rentals, enticing consumers to explore more with specific retailers.

Users can also contribute a portion of their purchase to a charity, unlock free upgrades, or dive into new experiences. The diverse range of offers ensures that every user finds rewards that deliver real value. During challenging economic times, discounts and cash back offers empower budget-conscious consumers to save more on their purchases.

By partnering with the right PLO provider, companies can gain powerful consumer insights and drive measurable results without changing existing infrastructure. In the end, payment-linked offers revolutionize how businesses attract customers, personalize marketing, and build customer loyalty.