What is a Shopping Rewards Program ?

A shopping reward program is a special offer put forward by sellers to encourage buyers to buy more frequently from the same seller, that is, them. A shopping reward program is thus, a loyalty program where buyers get either discounts or some money back or maybe even get to make a contribution to charitable organizations if they buy goods from the same buyer frequently.

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A reward program or a loyalty program is beneficial for the seller as the seller usually makes the buyer divulge her or his personal contact details which the seller can then use to advertise more services and products. Also a reward program or a loyalty program works out well for the seller as the seller is ensured a greater sale and greater profits, thus even though the seller is offering a discount or some sort of cash back, the seller ends up making a profit. Some sellers claim that a loyalty program or a reward program is not too beneficial for the seller as the buyers who enrol themselves in such programs would have bought the products anyway. However, market statistics have shown that sellers have greater sales and make greater profits if they run a reward program or a loyalty program.

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Loyalty programs can be conducted in real time shopping as well as in online shopping. Physical shopping (as opposed to online shopping) and reward programs generally have a membership card which looks like a credit/debit card. This card is sometimes embedded with a computer chip which stores the amount of money that the buyer has spent on goods and services provided by that specific seller. Sometimes, this card is without the computer chip and had to be physically produced while buying goods in order to earn reward points or loyalty points. These points can then be redeemed for gifts.

In online shopping, each shopping portal runs its own reward program or loyalty program (if it has any in the first place). The buyer can either get discounts, or get cash back or earn points which can be redeemed for prizes. These points are sometimes entered into a sweepstake where the buyer receives pre-determined prizes irrespective of how much points the buyer has earned. Sometimes, loyalty program members are entitled to special offers - they get to look at a collection of goods first and make purchases before non-members, that is, the general public. Sometimes, there are special offers for reward program members - they get free stuff with the stuff that they buy.

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