Loyalty terms in plain words
The words you meet when you run a loyalty program, explained with examples from cafés, salons and restaurants.
A
Apple Wallet
Apple Wallet is the app on every iPhone that stores payment cards, boarding passes, tickets and loyalty cards in one place. For a local business it is a home for its loyalty card that customers already have, with no extra app to install.
Read the entryAverage ticket
Average ticket, also called average transaction value, is the amount a customer spends per purchase on average. It is total revenue divided by the number of transactions in the same period.
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B
C
Cashback
Cashback returns part of what a customer spends as credit for a later purchase. Spend €40 with 5% cashback and €2 goes onto the customer's account, ready for the next visit.
Read the entryCoupon
A coupon is a voucher that gives a discount or a free item when it is shown at the till. Unlike a loyalty reward, which a customer earns over several visits, a coupon is handed out to prompt one specific purchase.
Read the entryCustomer retention
Customer retention is a business's ability to keep the customers it already has. It is usually measured as the share of customers still buying after a set period, and for a local business it often matters more than winning new ones.
Read the entryCustomer segmentation
Customer segmentation means splitting customers into groups that behave alike, such as regulars, newcomers or customers who have gone quiet. It lets a business send each group the message that fits it instead of one message to everyone.
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D
Digital loyalty card
A digital loyalty card is a loyalty card that lives in the customer's phone instead of their wallet. It usually sits in Apple Wallet or Google Wallet, collects stamps or points when staff scan it, and updates itself after every visit.
Read the entryDouble stamp days
A double stamp day is a day when every visit or purchase earns two stamps on a loyalty card instead of one. Businesses use it to bring customers in on a quiet day and to move them faster toward their next reward.
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Digital loyalty program
A digital loyalty program is a loyalty program that runs on customers' phones instead of paper cards, usually with a card saved in Apple Wallet or Google Wallet.
See Digital loyalty cardDigital voucher
A digital voucher is a voucher delivered by email or saved to the phone instead of printed on paper, and checked at the till by its code.
See Voucher
E
G
GDPR
GDPR, the General Data Protection Regulation, is the EU law that sets how businesses collect, use and keep personal data. A loyalty program collects names, email addresses and visit history, so a café, salon or restaurant that runs one has to follow it.
Read the entryGift card
A gift card is a prepaid card loaded with credit that someone spends at a business, often bought as a present for someone else. The credit goes down with each purchase until it is used up.
Read the entryGoogle reviews
Google reviews are the star ratings and comments customers leave on a business's Google profile. They appear in Search and Maps, where many people choose a café, salon or restaurant, so they shape first visits.
Read the entryGoogle Wallet
Google Wallet is the Android app that stores payment cards, tickets, boarding passes and loyalty cards. For a café, salon or restaurant it is where Android customers keep the business's loyalty card, next to the cards they pay with.
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Gift voucher
A gift voucher is a voucher bought as a present: one person pays for it and another spends it on goods, a service or a set amount at the business.
See Voucher
L
Loyalty app
A loyalty app is a phone app that runs a loyalty program: customers install it to collect points, see rewards and receive offers. Large chains build their own; for a single café, salon or restaurant, a card in the phone's wallet often does the same job without the download.
Read the entryLoyalty card
A loyalty card is a card that records a customer's visits or spending and turns them into rewards. It can be a paper card with stamps, a plastic card with a barcode or a digital card in the phone, and it is the most common way a local business rewards its regulars.
Read the entryLoyalty program
A loyalty program rewards customers for coming back. Each visit or purchase earns something, such as stamps, points or cashback, which the customer exchanges for a reward. For a local business its job is simple: turn a first visit into a habit.
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M
Marketing automation
Marketing automation means messages that send themselves when something happens, such as a first visit, a birthday or a long gap since the last purchase. You write each message once and set the trigger, and it reaches every customer at the right moment.
Read the entryMembership card
A membership card shows that a customer belongs to a business's club and unlocks the benefits that come with it, such as a standing discount or early access. Unlike a stamp card, it is about status rather than collecting toward one reward.
Read the entryMobile wallet
A mobile wallet is an app on the phone that stores payment cards and passes such as tickets, gift cards and loyalty cards. On most phones it is Apple Wallet or Google Wallet, and it opens with one tap or straight from the lock screen.
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P
Personalization
Personalization means tailoring a message or offer to one customer, based on who they are or what they have done. For a local business it can be as simple as using a name, remembering a usual order or sending a birthday greeting.
Read the entryPoints program
A points program gives customers points for what they spend and lets them exchange the points for rewards. Unlike a stamp card, it rewards a large purchase more than a small one, which suits businesses where bills vary.
Read the entryPOS system
A POS system, short for point of sale, is the till where a business rings up a sale and takes the payment. Today it is usually software on a tablet or terminal that also stores every sale.
Read the entryProfit margin
Profit margin is the share of each sale a business keeps as profit after costs. Gross margin subtracts only what the product costs; net margin also subtracts rent, wages and every other expense.
Read the entryPush notification
A push notification is a short message that appears on a phone's lock screen without the customer opening an app. For a café, salon or restaurant it is the most direct way to reach regulars who keep the business's loyalty card in Apple Wallet or Google Wallet.
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Punch card
A punch card is another name for a stamp card: a card that gets a hole punched or a stamp added at each visit and gives a reward when it is full.
See Stamp card
Q
R
Referral program
A referral program rewards existing customers for bringing new ones, and usually rewards the new customer too. It turns word of mouth, which local businesses already rely on, into something they can encourage and count.
Read the entryRepeat purchase rate
Repeat purchase rate is the share of customers who buy from you again within a set period. It shows whether people come back, which matters more to a local business than how many try it once.
Read the entryReward expiry
Reward expiry is the date after which an earned reward, such as a free coffee or a stack of points, can no longer be used. A sensible expiry date gives customers a reason to come back soon and keeps old rewards from piling up as a cost.
Read the entryROI
ROI, or return on investment, measures what an investment earns compared with what it costs. It is written as a percentage: an ROI of 100% means you earned back the cost and the same amount again.
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S
SMS marketing
SMS marketing means sending offers, reminders and news to customers as text messages. Almost every phone receives them, but each message has a cost and customers must have agreed to receive marketing.
Read the entryStamp card
A stamp card is a loyalty card that collects one stamp per visit or purchase and gives a reward when it is full, such as a free coffee after ten. It is the simplest loyalty program to explain, which is why cafés, bakeries and salons have used it for decades.
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T
V
Visit frequency
Visit frequency is how often a customer comes back within a set period, such as visits per month. It is one of the clearest signs of loyalty, because a regular who visits more often is worth more than a new customer who comes once.
Read the entryVoucher
A voucher is a prepaid document that a customer exchanges for goods, a service or a set amount of money. Gift vouchers are bought by one person and used by another, so they often bring a new customer through the door already paid for.
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VIP membership card
A VIP membership card is a membership card for a business's best customers, often by invitation, with benefits such as a higher discount or priority service.
See Membership card
W
Wallet pass
A wallet pass is a digital card stored in Apple Wallet or Google Wallet, such as a boarding pass, an event ticket, a gift card or a loyalty card. It carries a barcode or QR code, shows live details and updates without the holder doing anything.
Read the entryWin back campaign
A win back campaign is a message or offer sent to customers who have stopped coming, to bring them back before they are gone for good. It usually goes out after a set time without a visit and gives a concrete reason to return.
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