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Understanding Loyalty Cards

Points-based loyalty programs for customers and businesses

Dec 5, 2025

Loyalty cards are the core of points-based rewards programs. Customers earn points with each purchase, accumulate them over time, and redeem them for rewards.

What Are Loyalty Cards?

Loyalty cards are digital reward programs where customers earn points based on their purchases. Unlike stamp cards (which have a fixed goal), loyalty cards let customers accumulate points continuously and choose from multiple rewards at different point levels.

Think of them like:

  • Airline miles programs
  • Credit card rewards
  • Coffee shop points systems

How Loyalty Cards Work

For Customers

  1. Collect a card — Add a business's loyalty card to your wallet
  2. Make purchases — Shop at the business as normal
  3. Earn points — Show your QR code at checkout to earn points
  4. Accumulate — Points add up over time
  5. Redeem rewards — Exchange points for rewards when you're ready

For Business Owners

  1. Create a card — Design your loyalty program
  2. Set earning rules — Define how customers earn points
  3. Create rewards — Set up what customers can redeem
  4. Train staff — Show them how to award points
  5. Track performance — Monitor engagement and redemptions

For Staff

  1. Scan QR codes — Identify customers at checkout
  2. Award points — Enter purchase amount to calculate points
  3. Process redemptions — Fulfill reward claims
  4. View history — Check customer balances when needed

Points vs. Stamps

Loyalty cards (points) and stamp cards serve different purposes:

Feature Loyalty Cards Stamp Cards
Progress Open-ended Fixed goal
Earning Points per purchase Stamp per visit
Rewards Multiple options One reward per completion
Balance Accumulates continuously Resets on completion
Best for Long-term engagement Quick wins

Many businesses use both to maximize engagement.

Key Concepts

Points

Points are the currency of loyalty cards. Customers earn points based on:

  • Fixed amount: Every purchase earns X points
  • Percentage: Earn 1 point per $1 spent
  • Custom rules: Special promotions or bonuses

Rewards

Rewards are what customers redeem points for. Options include:

  • Free products: "500 points = Free coffee"
  • Discounts: "1000 points = 20% off"
  • Experiences: "5000 points = VIP event access"
  • Gift cards: "2500 points = $25 credit"

Tiers

Some programs have membership tiers that unlock better benefits:

  • Bronze: Standard earning rate
  • Silver: 1.25× points on purchases
  • Gold: 1.5× points + exclusive rewards

See Membership Tiers for details.

Getting Started

For Customers

For Business Owners

For Staff