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  • Writer's pictureAndrew Gazdecki

Ditch Your Punch Cards To Win Over Millennial Loyalty

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For decades, businesses have relied on the punch card as the backbone of their customer reward program. That seemingly ageless loyalty program, however, might not be as timeless as was once thought. With mobile technology exploding in popularity and usage -- and millennial audiences always on the lookout for the best customer experience -- the classic punch card loyalty system may be headed the way of the dinosaurs.

Millennials make up roughly one-fourth of the U.S. population (77 million). This year, they will have the most spending power of any generation. Attracting millennial business is undeniably crucial, but understanding how to retain this audience's loyalty is not so clear.

We do know that:

A brand that wants to earn the business of Gen Zers and millennials needs to show them loyalty, since 63% feel there are so many choices of where to shop.

Compared to other generations, millennials are more likely to stick with a brand due to its loyalty rewards (22%) and its reputation or philosophy as a company(15%).

Rewards for purchases made in a store, via a website or on a mobile device appeal to 80% of millennials, who also like the option of selecting various types of rewards.

Several factors motivate or discourage millennials, and you can use what drives them to elevate your loyalty program to something superior and more engaging for all customers.

Be Fast Or Forget It

Your millennial audience (almost) doesn’t remember a time without the internet. The lifetime of a millennial has been filled with instant access to, well, just about anything. The idea of instant gratification is a valuable insight when approaching millennial customer loyalty. It has to be fast. Ideally, you want to limit the number of steps it takes for a customer to participate in your rewards program. Every action creates an obstacle that could cause a millennial to abandon their efforts altogether. The best forms of loyalty programs are the ones that create value, in the eyes of the customer, with few or no steps.

Be Bold, Be Different

A punch card system is easy to implement; however, as one of the oldest and most widely used loyalty programs, punch cards have essentially become victims of their success. They've reached a point where it's no longer an exciting experience for the customer.

Millennial audiences, in particular, like to experience new things, and they take notice when businesses engage with them in unique, fresh ways. Thus, winning over this generation requires your loyalty program to be different and better than the tired punch cards and loyalty points.

There are two parts to any loyalty program: the rewards and the actions required to reach that end goal. First, you can offer more exciting rewards than just simple discounts.

For example, an Italian restaurant in New York, Vino Vidi Vici, gives rewards like having the customer's name engraved into a table or a free Ferrari with pizza delivery (after a million purchases). The ludicrous nature of these rewards makes it more fun for the customer than just a 5% discount. Alternatively, you can make it more fun to earn points and reach the reward. In fact, fun is a critical loyalty driver among 60% of millennials. So don't be afraid to get creative and bold with your program. It may be just what your business needs to stand out.

Get Charitable

Millenials have an unfair reputation of being self-involved and entitled, but they are one of the more charitable generations. Eighty-four percent of millennials made a generous donation in 2014, and 70% donated at least an hour of their time toward volunteering for a cause that is important to them.

This increased importance of charity extends to the brands that millennials choose to shop from. Not only does your company have to be socially and environmentally responsible, but it also, ideally, should be charitable and actively involved with particular causes.

You can elevate your loyalty program by allowing customers to use their points toward a charitable donation. Even the millennial customers who don’t participate in your loyalty program will take notice of your charitable initiative and will hold you in higher regard over competing brands.

Use Today’s Technology

It's no secret that millennials (and just about everyone else) use their mobile smartphone devices a lot. Again, members of this generation grew up on the internet, and their attachment to and reliance on the latest and greatest technology is evident. If you want your loyalty program to succeed in the eyes of this audience, it needs to be enhanced with the tech tools that millennials love to use.

In many cases, this means creating a mobile loyalty program through a mobile app or an easy-to-access, mobile-friendly webpage. This allows millennials to engage with your loyalty program in an environment that they are comfortable using.

Not to mention, technology offers the opportunity to make a better loyalty program. For example, a mobile loyalty program means customers can check their progress toward their reward goals at any time. This helps keep them on the hunt and returning to earn more points toward those goals. You can even encourage their progress through personal push notifications, as personalization is a top priority when it comes to loyalty and millennials.


As the millennial audience continues to mature, it's becoming increasingly important to know how to attract and retain their loyalty. These insights will help you get into the mindset of millennial customers and understand what motivates them to be brand-loyal. Your loyalty program should be easy to access, different from other programs, optimized with the latest technology and charitable to some degree.

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