A survey shows that 60% of members of German coalition loyalty card, Payback, are interested in its new Visa payment function.
German coalition loyalty programme operator Loyalty Partner, along with Visa and Landesbank Bade-Wuerttemberg (LBBW) has launched the Payback Visa loyalty payment card. According to a survey, some 60% of Payback's existing 15m cardholders expressed an interest in the Visa payment function. Customers can collect points for purchases from Payback's existing partners, and also on their monthly Visa balances.
The Payback loyalty programme was launched in March 2000. It is owned jointly by Lufthansa, Metro AG Group, Alex Rittweger and Roland Berger, and operates in Germany and Austria. It has 20 partners operating some 3,500 point of sale terminals.
Online and off-line
Payback operates both online and off-line. For off-line use, magnetic stripe cards are swiped through the partners' terminals and loyalty points are awarded, a hundred points being worth one euro. For online use, a membership number and PIN are used. Points are valid for 36 months and, when 1,500 points or more have been collected, they can be redeemed for cash, transferred to a bank account, spent on goods or donated to UNICEF.
Partners dictated by members
According to an interview that Rittweger gave to European loyalty guru, Peter Wray, "The combination of off-line and online collection for consumers and partner companies is crucial. We also feel that it is very important to build an attractive partner portfolio that is dictated by the sectors in which our members spend their money, rather than by any pre-conceived ideas of brand synergy. A programme such as Payback has to be present in all key industry sectors that are relevant to the consumer - from a perspective of both high frequency and high added value. Participating partners have to convince consumers through their sheer market size and premium image."
Big savings for partners
Rittweger told Wray that coalition programmes have a strong track record in Europe, with household penetration rates peaking at over 50%. He emphasised the importance of having a neutral third party manage a coalition programme: a party who can consider the needs of consumers while simultaneously acting as broker between the participating companies. A good coalition programme can save as much as 40-60% of the cost of running an independent programme.
For the full interview, visit Peter Wray's web site.