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Card-linked Offers 101

6 minute read

Shopping habits have changed over the last several years in a way that no one could have imagined. As a result, customers are now looking to foster deeper relationships with brands, assuming they can offer convenience and seamless customer experiences. In turn, brands want to find better ways to connect with their audiences and provide superior value. That’s where card-linked marketing comes in. Card-linked marketing uses past purchase data to create targeted, relevant advertising that is presented through the consumer’s mobile and online banking application. It’s become so popular that in a recent survey by the Digital Commerce Alliance, 35% of respondents indicated that their card-linking programs grew by more than 100% in the last 12 months. 

In the past, retailers used to lean heavily on the use of printed coupons to drive short-term sales. Then card-linked marketing emerged. Card-linked offers are rewards that consumers automatically receive just by linking their debit or credit cards to an app, website or loyalty program. This approach offers impressive benefits, including being easy to track, cost-effective and backed by actual purchase data, which makes offers more relevant. Customers are also required to opt-in, so there are fewer privacy concerns. Let’s take a look at what card-linked offers are, how they work and what the benefits are.

What are card-linked offers, and how do they work?

Card-linked offers are digital offers from brands and retailers linked directly to a payment provider like a debit or credit card. Then the offer is redeemed by the consumer when the linked payment card is used at the point of sale.

The process essentially works like this:

Retailers and merchants create an offer like cash back rewards or a statement credit. Then, consumers discover offers on websites and apps that they frequent. From there, the consumer links their debit and credit cards to the website or app to earn card-based rewards. And, when the consumer pays with the linked card, they are immediately rewarded.

Some card-linked marketing channels include bank websites, mobile banking apps, airline emails, and browser apps that display card-linked offers anywhere consumers shop and search online. One example is Shell Fuel Rewards, where customers automatically earn a 5-cents-per-gallon discount on enrollment. Then they can use linked cards at participating dining locations to receive a 10-cents-per-gallon discount for every $50 spent as well as earn a 5-cents-per-gallon discount on every $50 spent through the Fuel Rewards Network online mall.

Advantages of card-linked offer programs

Given its many benefits, card-linked loyalty can be a huge competitive advantage for advertisers/brands. Unlike paper coupons or online promo codes, card-linked offers are frictionless— removing unnecessary steps at the point of sale. Card-linked offers also allow brands to understand consumer behavior better than ever by allowing access to detailed consumer purchase data and analytics. With traditional digital marketing efforts, brands pay for clicks or impressions without being able to track sales or in-store visits. With card-linked offers, advertisers can see the direct impact of their investment because every dollar is directly attributable to a sale. And the best part—these offers are purely paid for based on performance. Merchants and retailers don’t need to pay for the offer until after the qualifying sales occur, which allows for an overall higher return on marketing dollars.

From the consumer’s perspective, card-linked offers are relevant and personalized. They are also easy to redeem because users automatically earn discounts or cash back rewards without digging around for a promo code or coupon. Card-linked offers also use strict privacy protection, which gives users peace of mind. In addition, these offers are most often in the form of cashback rewards which literally puts dollars back in people's wallets. This benefit can be a motivating factor during challenging economic times when consumers tend to become increasingly cost-conscious. Another advantage is that there is something for every consumer. In addition to cash back, merchants can offer deals on a variety of everyday purchases, from travel perks to dining rewards.

Card-linked offers as part of an omnichannel strategy

An omnichannel strategy provides customers with a fully integrated shopping experience that unites user experiences across multiple touchpoints. The goal is to provide a seamless experience where your content and actions transfer from platform to platform. That way, no matter how or where a customer interacts, the shopping experience is the same. That’s why more merchants and retailers are adopting card-linked offers to connect online offers with in-store purchases. In addition, with card-linked loyalty, no transaction can be missed, which increases omnichannel engagement. As a result, card-linked offers are quickly growing in popularity. In fact, they are so popular that The Digital Commerce Alliance survey showed card-linked programs topping the list of the most preferred marketing channels—even surpassing social media for the top spot.

Card-linked offers as cookieless marketing

Another advantage to card-linked offers is that they are a solution for precision targeting that doesn’t rely on third-party cookies. Because of consumers' growing demand for privacy, Safari and Firefox have already disabled third-party cookies. And Google Chrome, which represents close to half of the U.S. browser market share, will stop using them by the end of 2024. Given that Epsilon research estimates that about 80% of advertisers depend on third-party cookies, it’s time to find a new way to reach customers and prospects online. By leaning into first-party data, you can minimize the impact of a world without third-party cookies. Card-linked marketing uses actual transactional data and purchase history, which is more accurate than cookie-based measurement. In addition, consumers have much greater privacy on their devices without third-party cookies.

Using card-linked offers to power loyalty programs

Retaining existing customers while attracting new ones is becoming increasingly difficult. Fortunately, card-linked offers provide many advantages for retailers and merchants. For one thing, customers don’t need a separate loyalty card. Instead, they are identified by their card transaction, which also saves on the cost of loyalty card production and replacement. Card-linked offers are also incredibly flexible. Rewards can be automatically applied to the customer’s card, with the total value of their loyalty tracked over time. And they’re versatile enough to be used as part of any industry’s loyalty program. That’s because the process results in a frictionless customer experience while giving merchants granular insight into transactional data and shopping behaviors. With this understanding of the customer, it’s possible to enable highly targeted and personalized communications. As a result, brands have an opportunity to create even stronger loyalty and engagement in the future.

How to measure success with card-linked offers

Detailed reporting makes it very easy to measure the success of card-linked offers. For example, card-linked offers are proven to increase the number of transactions. According to the 2018 Cardlinx survey, 62% of brands that use card-linked offers saw transaction volume more than double over the past year. And with card-linked offers, merchants can track customer behavior easily by seeing the average order size, as well as the number and frequency of purchases.

Some other valuable success metrics include:

  • Number of net new customers: a measure of how many new customers are acquired compared to old customers who leave
  • Number of repeat customers: number of customers who have made more than one purchase
  • Repeat purchase rate: the ratio of customers who made more than one purchase over a set period compared to the overall customer base
  • Average spend per customer: total transaction amount from non-subscription payments divided by the number of customers Engagement rate: how much your audience is actively engaged with content

This knowledge allows brands to incentivize customers to make repeat purchases and reward their best customers for their loyalty.

Cardlytics for card-linked marketing

Cardlytics is not only a leading advertising and technology company, but we are also the pioneer in card-linked marketing. Through our partnerships with financial institutions like Wells Fargo, Bank of America, and PNC Bank, We see 1 in 2 purchases in the U.S., allowing us a complete view of consumer spending. This Purchase Intelligence™ is the foundation of how we target and measure all our campaigns. Our technology provides valuable insight into consumer purchase behavior for approximately 70% of U.S. households across all stores and categories. Our advertising platform helps you reach real customers at the right time when they are thinking about how and where to spend their money. With targeting based on past purchase history, ads on our platform provide real value to customers and act as the critical tipping point for a purchase.

Over the last several years, card-linking has transformed from an emerging technology showing record growth to an efficient tool that brands regularly rely on. And the proof is in the numbers. Card-linking has become a significant revenue stream for merchants worldwide. In fact, 65% of those surveyed as part of the Digital Commerce Annual Industry study reported sales of more than $1 billion attributable to card-linked offers.

Card-linked marketing will only continue to gain popularity as an independent marketing channel. That’s because, with minimal effort, brands can integrate rewards across customer touchpoints to drive sales. And as an added benefit, these offers allow advertisers to gather broad transactional data to learn about customer purchasing behavior, which they can use to create more effective marketing strategies. That means card-linked offers will help advertisers create personalized promotions that continue to draw consumers into stores and keep them coming back for more.

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