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What Happens To Loyalty Programs In A Mobile Wallet?

December 15, 2014 - eCommerce, Mobile -

Whether with ApplePay or someone else, the mobile wallet and the idea of paying for things without reaching for a credit card are clearly here to stay.

So, the next question is, what about everything else I’m currently carrying around with me? Specifically, what about all my loyalty programs?

I carry an iPhone and so I’m already used to accessing some of my loyalty cards (including airlines, hotels and my favorite, my AMC Stubs card) through the Passbook app on my device. But it’s far from a complete set.

A report issued last Spring from the Federal Reserve observed that there are a significant number of smartphone owners who see the device as an ideal venue for receiving deals, discounts and loyalty incentives, noting that “tying these services to a mobile payment service would increase the attractiveness of mobile phones as a means of payment.”

But they also note that very few mobile wallet providers up until now have focused any attention on integrating brand-specific loyalty programs into their solutions. Rather, their efforts have gone single-mindedly into the payment piece. (Even ApplePay does not work with corporate credit cards or certain co-branded cards tied specifically to loyalty programs.)

Cracking this nut will be critical if one app seeks to become a true single-wallet experience. As mobile becomes the home for loyalty, continuing to use standalone apps for every different program will simply be untenable. The ability to manage all loyalty efforts from a single place, in the same way people now anticipate consolidating their payment options, will require not just an intuitive solution but some level of cooperation or standardization between programs.

While this cooperation may seem like a pipedream, there are already brands embracing the idea. Starbucks, for example, talks about a loyalty network where brands cross-merchandise their programs, enabling them to build greater loyalty by giving their customers a broader array of branded rewards.

And the brand that can look at loyalty as one interconnected cohesive program that acknowledges all of a customer’s favorite brands, and delivers it in a seamless mobile experience, will be a brand that is here to stay.

Which loyalty programs do you wish were cooperating?

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