Glossary
What is punch card?
A punch card is the paper ancestor of the digital stamp card, physically marked with a hole punch or rubber stamp at each visit.
Punch cards fail for three reasons that are hard to design around: customers lose them, which resets progress and kills motivation; they are trivially forged with any matching stamp; and they give the business no record of who its repeat customers are. A wallet-based stamp card keeps the same mechanic and removes all three failure modes.
Why do customers stop using punch cards?
Because losing the card resets their progress to zero, and a customer who has been reset once rarely starts again. The embarrassment of asking for the stamps back is usually enough to end participation quietly.
The loss rate is the part businesses never see. Cards live in pockets and wallets alongside receipts, go through washing machines, and get thrown out during tidy-ups, and none of that is ever reported back to the business.
How easy is punch card fraud?
Easy and effectively undetectable. A rubber stamp resembling any given business's costs less than two coffees, and a paper card carries no record of when each mark was made or by whom, so there is nothing to audit.
The signal, when it appears at all, is a redemption rate that does not match observed footfall. By that point you cannot tell which cards were real.
Is paper ever still the right choice?
For a very small or very new business with no interest in knowing who its customers are, paper is defensible. The threshold is a question rather than a customer count: the first time you wonder where a particular regular went and realise you have no way to find out, paper has stopped being enough.
See also
- Stamp card: A stamp card is a loyalty mechanic that rewards a fixed number of visits, one stamp per visit (buy ten coffees, get the eleventh free), and is the digital successor to the paper punch card.
- Wallet card: A wallet card is a digital card stored in Apple Wallet or Google Wallet (the same place people keep boarding passes, event tickets and payment cards) that can update itself remotely after it has been issued.
- Points expiry: Points expiry is the rule that unused loyalty progress lapses after a set period, and it should be set from how often the business's own customers buy rather than copied from a larger scheme.
- Loyalty tiers: Loyalty tiers are levels within a programme that unlock better benefits as a customer spends more, and they only mean anything once enough customers sit in each level for the distinction to be visible.
- Average transaction value: Average transaction value is the mean amount a customer spends per visit, and in a loyalty programme its variance, not its size, is what decides whether to count stamps or points.
Further reading
How to add a loyalty card to Apple Wallet
A step-by-step guide for customers and business owners on getting a loyalty card into Apple Wallet, and what to do when the Add button does not appear.
Why paper punch cards fail, and what to replace them with
Paper loyalty cards lose customers for three structural reasons. Here is what each one costs and how a wallet card fixes it.