Credit Cards Now Loyalty Cards

Starting this week, consumers will be able to make their credit cards into loyalty program cards at retailers, eliminating the need for a separate card that tracks purchases and doles out rewards, according to Jeff Lipp, CEO Plaid of Chockstone, a loyalty marketing and technology company.

The new Chockstone initiative--supported by major credit card issuers including Visa, MasterCard, American Express, and Discover--aims to boost traffic for retail loyalty programs while spurring greater use of credit cards in place of cash. For the launch, participating retailers include Subway, Plaid Pantry, CC's, and Boston Market. Lipp described most Chockstone clients as "very large merchants with a lot of physical locations and a large amount of foot traffic on a daily basis."

According to Lipp, the new "Single Swipe" program will "allow customers to tie their favorite merchant loyalty programs to their existing credit or debit card" by going to the Web site of participating retails and registering the card. When they use the card at a Chockstone retailer's location, the retailer will automatically tally the purchase in the customer's loyalty program towards an eventual reward.

Of course, such loyalty programs allow merchants and card issuers to track purchase patterns more precisely; that, in turn, allows them to offer tailored offers and special promotional deals to customers in real time at the point of purchase, while the transaction is in progress. Lipp summed up Single Swipe by saying it will "enable real-time payment and loyalty program identification in a single transaction."

Lipp said retailers will promote the program with email announcements, ad campaigns, and in-store displays, as well as through personal interactions with sales staff at the cash register. The credit card issuers will also playa major role in marketing the new service, as "it will further accelerate the conversion from cash to credit cards, and that's what they're really excited about," according to Lipp.

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