Catuity comments as Target drops chip-based loyalty
The loyalty software provider, Catuity Inc., has confirmed that one of its major customers, Target Corporation, has indicated that it is to phase out its smart chip technology programme.
Catuity was notified by Target that it has elected to phase out its use of smart chip technology over the next 12 months. This technology was the first to be used on a nationwide basis by a major retailer, and contained the Catuity software as part of an e-couponing smart loyalty application.
"We are disappointed that this specific programme will not be going forward. Catuity is fortunate that its loyalty software supports a variety of consumer identification devices; while, in this instance, it was smart chip technology, the system works equally well for magnetic stripe, contactless, RFID, or bar codes, and we are hopeful that we can continue to work with Target in the future," said Michael Howe, president and CEO for Catuity.
Howe said that Catuity is now evaluating the impact of this announcement on its 2004 forecasted revenue and net income, adding: "We believe at this time that it will be material. The company will provide additional information in its Form 10K filing in mid-March."
Catuity provides loyalty programme management and e-coupon software to merchants, card issuers, and processors, to establish and administer loyalty and e-coupon programmes that immediately reward profitable customer behaviour at the point of sale.