Deal paves way for customer loyalty schemes

SMALL RETAILERS will be able to establish inexpensive customer loyalty schemes following a deal between AIB Merchant Services and Irish-based Zapa Technology. The exclusive agreement means merchants can use Zapa’s contact-less chip technology in their shops, removing the need for individual loyalty cards and systems.

Zapa uses near-field communications technology to produce a small sticker that can then be stuck to a customer’s phone or wallet. Users can then tap the sticker on a terminal at the point of purchase, registering it on the chip and gaining rewards in return.

One sticker can be used across any number of shops, with each business’s loyalty programme working independently of others.

“This is a merchant-specific scheme but the sticker works in multiple merchants,” said Chris Mason, managing director of AIB Merchant Services. “The points a customer earns across shops does not get consolidated into one place; each retailer can have their own scheme in place.”

However, it is also possible for a single loyalty system to be established across a number of shops, for example, allowing businesses in small towns to offer a centralised reward scheme to those who buy locally.

In addition to saving money by not having to roll out and manage an individual loyalty scheme, the Zapa system will give merchants access to more customer information, Mr Mason said.

“The merchant can go online to see how many points have been redeemed, how many customers have the tags and what they are doing. It offers a lot of information in terms of who’s been in their shops and how regularly they have done so.

“They would also have the chance to communicate with them through an SMS or e-mail campaign.”

In order to participate, retailers will have a special terminal installed, which will cost up to €30 extra per month depending on the number a retailer takes. Merchants will also be given a supply of Zapa stickers that cost less than €1 each, a cost the retailer is able to pass on to the customer if they wish.

Zapa was launched last year by Alphyra founder and former Payzone executive John Nagle. The company’s first venture was a loyalty scheme with the Insomnia coffee chain.