Making Punch Cards Better

Nearly three years ago, I started thinking about Punch Cards.

Well, I'd been annoyed by them for decades; actually. I'd often lamented about how it seemed everyone conspired to put a card in my pocket. For a few years now, I have had an absolute policy of not enrolling in any loyalty or rewards programs or carrying any of their cards. I'd decided it was time to rebel; someone had to tell them enough is enough. Ridiculous; I know, but I like to get carried away.

Of course; passion of any kind can be a big wind behind anyone's back and over the years, partly to amuse myself, I came up with a few schemes and ideas that would allow businesses to enroll me in a loyalty program without making me carry yet another card around.

The problems with most of my ideas were either related to expense (e.g. custom hardware) or adoption (e.g. making customers install special software on their phone or training them to do some special action like scan a bar code). Although I didn't know it at the time; my focus on reducing the number of cards in my pocket was causing me to not give enough attention to the needs of businesses. I was ignoring the fact that businesses really like giving something to their customers that they'll carry around has their branding and message and that encourages them to come back. I was mainly thinking about what worked for me, as a customer, and not spending enough time thinking about what worked for the business (or even other customers).

Mobile software has similar advantages for businesses that cards do; and more (and less). A mobile application can, for instance, give a customer a timely alert that draws the customer back into making further purchases. But it's also true that there are significant number of customers who are reticent about installing and using mobile applications (and scanning QR Codes or using NFC, etc). For instance; Punchd said this about one of their showcase customers:

SLO Donut Company currently uses an equal amount of paper and virtual punch cards. Pickering said the only drawback is that “there are anti-smartphone people out there who can’t use the app.”

Some people just aren't that technology savvy or comfortable. It often takes time for people to adopt new technologies.

And then I realized there was a very simple solution to the issue of cards vs. mobile: do both.

By both I mean that businesses could hand out cards; identical to the cards they always have; except that the cards would have a QR Code on them and instead of being punched with a hole puncher or dabber; they would be punched with a mobile device (QR Code scanner).

And... technology savvy customers could scan their own card and convert to using a web/mobile app if they choose to.

By having the employee do the punching, it means the customer has the option to use their punch card, just like they always have, if they want to (i.e. the customer hands their card to an employee, who punches it and hands it back). But by providing the customer a path to switching to a mobile version of the card; everyone is happy.

But That's Still Not Enough

I have no idea who it was who said a product has to be ten times better than the existing product before it can be called an Innovation. But making cards that you could punch with a mobile device instead of with a hole puncher, by itself, doesn't make a punch card better. In fact; it makes it worse because at least the traditional punch card has holes or stamps that you can count. There are some small benefits with "registered cards" for customers (e.g. customers can lose a card and not lose their punches) but the biggest single benefit is to the technology savvy customer; who doesn't have to carry another card around.

Of course; the obvious feature for businesses is logging and reporting. One of the two biggest issues with the traditional punch card is that they largely go untracked. Possibly businesses are keeping track of redemptions, but probably not in a very detailed way. For the most part the cards just sort of go out into the wild and the business has no idea how many are being used, or how. However, with a connection to a central database you get to track all kinds of information automatically, or with small interface changes, that will let businesses all kinds of new information. And if you have employees stamping cards (or phones) with a mobile device you can use some of that data in real time (e.g. tell the employee the customer's name or vice versa).

The second big issue with traditional loyalty card systems is that they only reward one kind of customer behaviour: The "Buy 10 Get One Free" behaviour. But actually there are many behaviours that businesses would also like to encourage in their customers. And here is the real innovation: an application can be used to reward several kinds of behaviours impossible with traditional punch card systems.

Encouraging Other Customer Behaviours

There are many other behaviours that can be rewarded with an application that can better track and respond to customer behaviour. Many behaviours can be implemented in a way that requires no extra effort by the business, and others by adding small simple additions to a punching interface.

For instance; an application can know if the customer been back several days in a row, if the customer brought new customers (friends/family), shared the a special or event on Facebook, etc. (or reviewed on Yelp, etc.) or returned to the business after a long absence.

Web/Mobile applications can easily provide custom customer behaviours to businesses though an API which would enable businesses to, say, give customers punches for making purchases online, or through their POS. Or provide rewards the same way.

There's actually no end to where you can go; with a little imagination

Businesses can offer rewards behalf of other businesses.