Having worked directly with card-linked offers, I’ve witnessed how crucial it is to keep pace with shifting consumer expectations.
And while the traditional click-to-activate model once offered a novel way to engage customers, today’s landscape demands more.
Seamless rewards — which are automatically applied at checkout — provide an elevated, frictionless experience that consumers now expect. Based on my experience implementing both models, seamless rewards have proven to be the superior approach for brands that want to enhance loyalty and maximize revenue. Time and again, I’ve seen companies gain upwards of 90% revenue lift across retail, wholesale, and quick-serve restaurant industries using CLO.
Below, I’m sharing why merchants may want to reconsider click-to-activate offers, the benefits seamless rewards confer, and how incorporating card-linked rewards into your marketing strategy can decrease CAC, boost AOV, and, most importantly, increase LTV.
3 Drawbacks of click-to-activate
Click-to-activate has been the standard for cardholder rewards for decades. But just because it’s been around a long time doesn’t mean it should be every marketer’s go-to.
Here are just a few of click-to-activate’s shortcomings:
- Friction. The need to manually activate an offer can disrupt a consumer’s shopping flow. They head to an e-commerce website, add items to their cart, then realize they could be using an offer. At that point, they have to open their banking app and search for a specific offer. Knowing this is a cumbersome process, some consumers may avoid click-to-activate offers altogether.
- Missed opportunities. I’ve seen how customers often forget to activate offers or are unaware of the requirement altogether, leading to missed discounts and lost sales for merchants.
- Limited reach. Click-to-activate narrows your audience to the folks willing to take an extra step, which, in my experience, limits the overall impact of campaigns and reduces conversions.
The case for seamless rewards
Card-linked offers eliminate all three main issues with click-to-activate, meeting consumers’ demand for a smooth experience that makes them want to continue using their card — and continue purchasing at their favorite stores.
Seamless card-linked rewards offer:
Unmatched convenience
Consumers want rewards without added complexity. Since card-linked offers are applied automatically, there’s no onus on the consumer — they instantly get a reward once they’ve made a rewardable purchase.
For example, a national electronics retailer could offer 10% cashback on all purchases over $100 through a card-linked rewards program.
After linking their card, customers don’t need to remember to activate offers or input codes — they simply shop as usual. The 10% cashback is automatically credited to their account after the transaction. This seamless process removes the friction for the customer, making it easy to earn rewards without any extra steps. Customers are more likely to continue using their card at this retailer, knowing they will always benefit from the offer.
Higher engagement and conversion rates
In practice, I’ve observed that more customers take advantage of offers when they don’t have to activate them. Higher participation translates to increased transaction volumes and potentially even increased average order values — direct wins for merchants.
Say a clothing brand offers 5% cashback on purchases during seasonal sales, and the reward is linked to the customer’s card.
Traditionally, customers would need to activate the offer through an app or email link, and many might miss the activation step. With card-linked rewards, once the offer is connected to their card, they automatically receive the 5% cashback after every qualifying purchase. Since customers don’t have to actively participate, more people take advantage of the offer, leading to increased sales and, potentially, larger orders.
Lower drop-off rates
In many cases, the extra step required for activation in the click-to-activate model leads to cart abandonment. Seamless rewards eliminate this issue by ensuring customers complete their purchases without unnecessary interruptions.
Paths to sustained loyalty
Seamless rewards don’t just simplify transactions—they create deeper connections between consumers and merchants.
A supermarket, for instance, could provide a 2% cashback on all grocery purchases over $75. With a card-linked offer, customers don’t need to track their spending or use separate apps — the cashback is automatically credited to their card statement after each qualifying transaction.
Over time, customers become accustomed to this effortless way of earning rewards. Feeling good about the value they’re getting from their purchases, they’ll be less likely to explore alternative grocery stores.
What sets Kard’s seamless rewards apart
In my experience, the case for seamless rewards has never been stronger. As customer expectations evolve, the frictionless nature of these rewards makes them an obvious choice for brands looking to drive higher engagement, loyalty, and revenue. While click-to-activate offers once met the needs of consumers, the modern shopper craves simplicity and efficiency.
At Kard, we’ve embraced the seamless rewards approach to meet the growing demand for frictionless experiences — and it’s paid dividends.
- In a recent Kard campaign, a leading wireless carrier hit $1.3M in total sales while meeting aggressive CPA goals.
- Another Kard campaign for a cloud-based storage provider delivered over $100,000 in subscription revenue at $4.7:1 return on ad spend.
- A national meal kit delivery service saw a whopping 81% increase in revenue in just two quarters with Kard CLO.
And thanks to Kard’s first-party transaction data, all three gained critical insights about their customers’ behavior along the way, helping them continue to tailor their program and position themselves for long-term success.
Ready to pursue CLO yourself? Get started today.
