Loyalty cards are powerful promotions to ensure return business and discourage customers getting the service or product you provide from a competitor.
Picture this scenario: John Example needs coffee every lunch and there are two coffee shops, Coffee Shop A and Coffee Shop B, each within 5 minutes drive of his work place.
Their coffee is equal, their service equal. Each day John Example chooses randomly which one he goes to.
But then Coffee Shop B starts a loyalty card promotion: Buy 4 coffees get the 5th free with a complimentary sandwich.
John Example now has an incentive, a reason to go to Coffee Shop B every lunch time because on Friday he’ll get a free coffee and sandwich!