Credit card/loyalty rewards – all-in-one card?
A recent Springwise newsletter described Perkler, a website that helps people (primarily Australians, given that it’s an Aussie company) manage their perks, loyalty reward card offerings, credit card offers, and even some potentially redeemable rewards (such as cashing in airline miles for some sort of gift certificate).
It’s an interesting application of an idea I had many years ago. I thought that it would make sense to take all of this same loyalty information and encode it in/tie it to a single uber-reward card. Either a standalone card or tied to a suitable credit card, e.g., American Express, the card when swiped or scanned would trigger access to a database that would query for the best possible reward given both your available options and a set of preferences you have set. For example, some people would prefer to maximize dollar value of rewards while others prefer dealing only in one “currency,” such as airline miles.
A similar concept to the “one card to rule them all” is the all-in-one discount card DIY tool [Ed. Added link via lifehacker.com]. This allows you to create a single wallet-sized card with several sets of barcodes/numbers on it to save space in the wallet/checkbook. I think it certainly beats putting all those tags on a keychain like some people do.
In any event, the issues with implementing the OneRewardCard are tied to privacy, database construction, and vendor incentives.
On the privacy front, I’m one of those people who uses basically a single credit card for everything (bad long-term budgeting as I was leaving the Army and heading to law school taught me some credit lessons that boil down to “don’t spend what you haven’t got – ever, except for houses and education”). AmEx already knows where I shop and quite possibly what I buy (I don’t know how much line-item detail gets sent upstream through the authorization process or whether it varies according to vendor). I wouldn’t be particularly concerned about them getting extra information, and they could certainly enhance privacy as an offering for interested consumers.
Database construction is the issue of getting up-to-date rewards information into the database so people can get relevant offers and choose accordingly. The current example of what this problem looks like without vendor involvement is the plethora of deal/coupon websites that track many old/expired/inappropriate discount or coupon codes. At one point, I resolved to search for discount codes anytime I used a new ecommerce website, particularly one I hadn’t been receiving offers for. After searching for coupon codes, I got fed up pretty quickly with the inability of Google to parse those various sites (and the carbon copy/leech versions that abound as well) and the inherent difficulty for the sites themselves to have a comprehensive listing of up-to-date relevant offers. Human involvement or AI searching/screening are two answers, but bringing vendors inside the circle of trust is another.
Vendor involvement depends on the value proposition for a vendor in offering a discount. For example, a vendor seeking to reward customers with a special discount for past loyalty will not want to share that discount with new customers who haven’t “paid their dues.” Similarly, a vendor seeking to attract new customers would prefer not to give discounts to people who would buy anyways at the normal price. On top of that, the actual number of redemptions of an offer might rise dramatically, for which marketers/sales teams would have to adjust. My suspicion is that the initial thoughts of vendors will be that this program would weaken their connection to the customer since the element of knowledge of the origin of the discount is dramatically weaker — if I get a discount on flowers under the OneCard paradigm, I don’t necessarily automatically learn that the discount came from my USAA membership or my Platinum card or from my Allegheny College alumni status. I don’t believe that this is an insurmountable problem, just one that has to be thought out. (Quick idea: the OneCard could in fact be a smartphone app that would give proper credit to the right vendor or channel partner.) The real underlying goal of vendor involvement from the consumer perspective is getting the fullest set of offers available. It might well be that in exchange for better targeting data, and the possibility of point-of-search (a la perkler) or -sale impact, the net redeemed value of perks would rise.
There’s a business here that I just don’t have the contacts, time, energy, or money to pursue. Good luck to someone; I’d like to be on your board.