Department stores had the right idea when they started using in store credit cards as their customer reward program.
. They built a database. Without knowing about their customers lives they would not know how to get that customer into the store. This is one of the places where the credit card perfect. In order to get a store credit card the customer must fill out an application. Using this application the store is able to enter the customer's information into their computer. It is also the perfect time to enter the clients name and address onto the company mailing list. A really smart manager makes sure that the person handling the application process is a warm cheerful person. Normally the application process takes about fifteen minutes. That's about twelve more minutes then the average customer is going to spend with most casiers. In the customer's mind this person who is currently recording all their financial history will become the face of the company. When the customer thinks about the store she will be thinking about this person. It is important that the employee projects a pleasantly competent image.
A store has a computer system all set up and ready to go. They are ready to start handing out cards in order to get customers entered into their data banks. All they have to do is convince the customers that they need the card.
Most people who shop at department stores typically already have at least one credit card, most of them have several. The last thing any of these shoppers needs or wants is another credit card filling up the spaces in their wallet. They certainly do not want another monthly bill stacking up inside their mailbox. So the store sweetens the pot. The store spreads a rumor that something very nice will happen if the customer applies for a card. They may take an extra twenty percent off some of their purchases. Maybe they will be mailing coupons to cardholders. In store raffles are brilliant ideas. Not only do they get the customers name into the database but it also gets the customer into the store on a given day. With a little luck they will by something as they wait for a name to be drawn.
It is not enough that a customers name is in the database. Now the store has to come up with a way to get them back to store again, and again, and again. The best way to do this is add graduated rewards to credit card. An example of this would be that for every hundred dollars a cardholder charges to the card they get five dollars back. If they spend five hundred dollars they get a ten doller return on their investment. By offering this type of incentive the cardholder is very likely to become a regular customer. If the department store is lucky this loyal customer might bring a friend and the whole process can start again.
Another way the store can encourage customers to come back is to offer discounts on the stores products. A lot of bookstores and coffee shops do this. They give you a punch card and every time you buy a book or cup of coffee they punch your card. After you buy five books or ten cups of coffee you get one free or half price. This kind of behavior keeps customers in their store versus their competitor down the road.