A new start-up wants to help consumers tap into the free rewards promised by big brands - but rarely claimed
The technology entrepreneur behind many of the UK’s mobile banking apps is now taking on loyalty cards with a new start-up that aims to consolidate branded schemes on a single platform.
Mark Kanji, the founder of Apptivation, which designed and built apps for Halifax, Lloyds and Royal Bank of Scotland, launched Loyalive seven weeks ago and the app already boasts 30,000 users.
There are currently around ￡5bn in unredeemed points and rewards sitting in UK loyalty cards that could be spent on flights, holidays, days out, or groceries, according to research from Optimum, commissioned by Loyalive.
One in five UK loyalty card owners has not redeemed their loyalty points in the last year, and 7pc never have.
“There’s nothing out there that helps you understand all the points and rewards that you’ve earned across all your loyalty cards,” said Mr Kanji, who has invested ￡750,000 of his own money into the start-up. “We are now entering an era where people rely more and more on their smartphones to manage their finances. The next thing that should go mobile is loyalty cards.”
Loyalive allows users to see all their loyalty cards in its free app and supports 130 different loyalty card programmes, from Tesco Clubcard to Topshop and Nectar.
Signing up involves inputting your loyalty card information, which Mr Kanji admits “causes a little friction initially”. The business forecasts that 100,000 users will have registered by November this year. Around 40pc have signed up four or more cards.
Brands have not been “incentivised” to encourage their customers to redeem points to date, Mr Kanji claimed, but will soon look to these schemes for competitive advantage.
“Look at Sainsbury’s and Tesco; they are still seeing a flight of people to cheaper brands because they’re not using these loyalty schemes to make a point of difference and do what they’re supposed to do – make customers more loyal.”
The business is pre-revenue but once its reaches a high volume of users, it may allow smaller retailers to push loyalty schemes on the app for a fee, or feature advertising.
“Our next major push will be into the States,” said Mr Kanji, 36. “There are three billion active loyalty memberships in the US and each person has an average of 10 loyalty cards.”