How Facebook, Microsoft, Bank of America, Discover, Mastercard, and other banking and technology heavyweights are getting together to change the way we do discounts.
On October 7th the scions of Silicon Valley and the big bulls on Wall Street got together at this year’s Money2020 Expo to announce The CardLinx Association, a new, cross-industry group aimed at promoting card-linked offers. What’s particularly interesting is the seemingly diverse litany of brand name companies involved in the venture – Facebook, Microsoft, Bank of America, and MasterCard just to name a few – and the coherence of their concerted effort to push what could, quite possibly, do away with coupon clippings and punch cards for good.
Good For Consumers, Great For Businesses
The way we do business is changing. The emergence of online promotions in particular, along with the rise of mobile computing and the proliferation of smartphones, have fundamentally shifted the way consumers interact with, engage with, and make purchases from most vendors. At the same time, traditional means of promoting business are failing.
The ocean of conventional promotional materials (i.e. paper coupons, mail-in rebates, etc.), most of which are tossed in the trash, have become an enormous burden on time-pressed consumers. In other words, the archaic nature of many “offers” programs is physically limiting growth in a rapidly digitizing society. CardLinx referred to these limiting factors as a form of “friction” preventing the easy acquisition and redemption of relevant offers. For the average consumer, time and convenience is the new currency.
Traditionally, the act of driving consumer action, promoting customer loyalty, and collecting personal information for behavioral clues are handled as three separate processes. From a business’s perspective, this often means that the establishment in question would have to implement independent advertising campaigns, loyalty programs, and data farming apparatuses – all expensive, all with their own support requirements, and all completely disconnected from one another.
Card-linked offers promise to do all three with a single simple, integrated system.
Users simply sign up, purchase a digital coupon, which is then linked directly to their debit or credit card, and make a qualified purchase at a participating business. The discount is directly applied to their statement in real-time at the point of sale. No printing coupons. No swiping loyalty credentials. No waiting for the rebate to take effect. No hassles for both sides. Better yet, by parsing personal purchase history, vendors can craft deals relevant to each individual and deliver them directly.
Consumers get the exact deals they want, when they want them. Businesses get a unified architecture for promoting customer loyalty and delivering promotions. That’s a win-win.
Best Next Thing
Location-based, real-time offers were not a part of the retail experience just a few years ago. Yet, as consumers continue to demand, and ultimately acquire, more and more flexibility and agency in the way they approach the buying process, the drive towards this type of marketing innovation will only continue. The truth is, card-linked offers could be the best next disruptive technology to fundamentally change the way we buy and sell.
Businesses with the ability to adapt these market-shaping technologies stand a very good chance of better serving their customers, differentiating themselves from the competition, and gaining a critical key market advantage. LivingSocial certainly seems to think so. The much lauded online purveyor of daily deals, which has taken a beating in recent times, is a key CardLinx founding member and is betting that card-linked offers are indeed the way of the future.