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Understanding the Loyalty Points Bank

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By: Wise Marketer Staff |

Posted on March 7, 2023

A definitive treatment of the topic by Charles Ehredt, CEO Currency Alliance

Editor’s Note:

Charles Ehredt, CEO Currency Alliance shares the first article in a two-part series on the core microservices that enable loyalty marketing in modern enterprise architectures. The second article is titled the Loyalty Rules Engine -the module that varies pricing and rewards based on the context of the transaction, enabling the types of promotion that are familiar from every major loyalty program.

Understanding the Loyalty Points Bank: A Definitive Treatment of the Topic

The Points Bank in a loyalty program is the central module of technology platforms used to operate currency-based loyalty programs. The structure and organization of the Points Bank is critical to program success. It not only protects and manages the enormous financial investment by brands in their customer loyalty programs, but it also provides confidence to customers that their hard-earned equity in the loyalty program is safeguarded at all times.

To be fair, loyalty program members may never become familiar with the term “Points Bank” and they should not have to be. Our global financial system is built on trust. People believe the bank will manage their money properly and their resources will be available to them when they are needed. It is just the same in the customer loyalty game. Customers have made a decision to join a program, they have invested time and money patronizing their “favorite” brand, and they have expectations about the resulting points/miles/widgets they have earned in the program.

The Points Bank is working perfectly if the program member never becomes aware of its existence. That means the Points Bank is working well and doing its job.

In this article written by Charles Ehredt, CEO Currency Alliance, you will find learn that you may be operating in a monolithic platforms and have never considered how this module empowers (or limits) your overall loyalty program. As awareness grows of the benefits of API-first microservices, some forward-thinking loyalty marketers are beginning to ask whether their points bank is up to the job in delivering the customer value and customer freedoms that are necessary to keep pace with evolving market challenges this decade.

This article answers those questions, breaking down the discussion this way:  

  1. Explaining the core functionality of the points bank and how this varies in different generations of the software.
  2. Illustrating how a modern SaaS points bank differs from those typically included in a monolithic platform.
  3. Detailing the major improvements around security and accounting standards which newer platforms have introduced – and why blockchain is not needed for either.

Chuck wraps up the discussion describing where the loyalty industry is heading in the next 10 years and explains why an API-first points bank will be needed if brands are to keep up with the major developments and customer trends that are already underway.

You can find the complete article at Currency Alliance here.