Meet 2018 Goals By Making Payment Solutions Your Next Loyalty Campaign

0aaJoe Ferguson Fortiva

Returning customers drive more than 22% of retailer revenue and spend 15% more than new customers on any given order, according to a study by StitchLabs. Given this obvious financial incentive, not to mention the high cost of attracting and activating new customers, investment in programs that drive loyalty and customer retention is essential. Today’s tech landscape and proliferation of e-Commerce offers more opportunity than ever for retailers of all sizes to leverage cost-effective retention strategies at one key element of their operations: the POS.

“We believe customers are first and foremost loyal to the solutions that solve their problems and we are passionate about that,” said Patrick Gauthier, VP of Amazon Pay. “Today over 50% of Amazon Pay buyers are Amazon Prime customers, demonstrating the benefit of providing familiar, trusted payment methods wherever they shop.”

Ensuring trust, speed and ease of access at the POS — whether in a store or online — is an important element of ensuring customer loyalty. This can include ensuring your payment solutions are up to speed across channels, or simply engaging consumer financing institutions for a well-integrated, far-reaching consumer credit program.


As retailers pursue their 2018 goals of better customer loyalty, leveraging the POS to retain customers is a great place to start.

Integrating For An Easy Way To Pay

“One main lesson is that you need to remove as much friction as possible for the customer,” said Gauthier. “For instance, one of our early merchants, AllSaints, reported that Amazon Pay shortened the average time spent at checkout by 70 seconds, which increased checkout conversion by 34%.”

A seamless, hassle-free experience at checkout can make an impact when it’s time for a customer to make their next purchase. The importance of omnichannel access is well-documented at this point, such as Centric Digital’s report of Macy’s 250% profit margin growth after initiating its omnichannel transformation, but many retailers still drop the ball when it comes to ensuring that their checkout processes are up to par with the quickest, most secure interface across the board.

To avoid a bad customer experience, it is important for retailers to demand the best out of their developers and payment vendors. This means ensuring that all third-party vendors are equipped to bring payment services together across various POS systems. This means working with established providers to ensure they are flexible and able to integrate with existing solutions, such as payment solutions like Amazon Pay or national consumer financing providers with adaptable technology. Retail software solutions also are available to bring different vendors together, such as STORIS in the furniture sector.

Consumer Financing That Inspires Loyalty

Consumer financing programs involving a line of credit and a branded store credit card are effective for bringing customers back by (1) Providing an easily accessible financial resource with which to make purchases, and (2) Putting your logo into their wallet as a constant reminder. Just as Amazon Pay makes it easier to make purchases by storing payment information, customers with an existing line of credit can easily complete their next purchases because their financing information was established during their initial purchase.

As discussed with POS above, the application process must be instant and seamless across channels. According to a 2017 survey by Vyze, respondents cited aversion to disclosing financial information to a store representative (26.9%of respondents) and a long application process (15%) as reasons they opted not to apply for retail credit. Instant, digital application kiosks in-store can resolve both of these issues, and integrating the application process across digital channels is vital to satisfy customers shopping online.

It’s also important that financing providers offer a revolving line of credit rather than strictly providing installment loans. Installment loans establish an end-date for the customer’s credit access, whereas lines of credit empower them to return for years to come rather than cutting them off once the initial purchase is paid in full.

Credit lines also enable stores to directly engage with account holders to bring them back, such as offering interest-free financing on televisions for existing credit card holders. Another approach is to remind customers they have credit available, which offers a huge communications advantage over marketing to convert a new customer.

Leading financing providers can provide further incentive for customers to revisit the store on their established lines of credit, whether by extending special offers to credit holders or simply reminding the shopper that they have the resources available to make important purchases. For example, a financing provider can work with major national retailers during peak shopping seasons throughout the year to proactively contact current credit holders to remind them that they can use their available funds to come back.

Reaching All Shoppers With Financing

It is common for branded store credit card programs to be supported by prime lenders like Wells Fargo or Synchrony, but these institutions are typically only able to provide credit to customers with FICO scores above 700. Unfortunately, this limits stores from obtaining the business and loyalty of the more than 43% of Americans that reports have scores below that benchmark, most of whom would be denied prime credit offerings. Because it can take more than seven years to repair credit, this can cause retailers to decline viable customers with solid cashflow, and because Vyze’s study found that 10% of respondents cited a fear of being declined as a reason not to apply, it is important that retailers offer a solution to assist these customers. Otherwise, they could lose them forever to a competitor that is able to comfortably satisfy their financing needs.

Second look financing providers approve customers with lower FICO scores by assessing other factors to determine a customer’s ability to pay. For example, at Fortiva Retail Credit, we are able to approve between 30% and 50% of applicants who were initially declined by a prime lender — with approvals down to 480 FICO scores.

When someone’s credit score doesn’t necessarily reflect their income or ability to make payments for a big-ticket purchase, having second look financing to back up prime financing options helps customers make important purchases they otherwise couldn’t afford, whether it’s a much-needed appliance, holiday gifts for their families or in-home repairs or upgrades.

Second look financing is a great way to ensure return business by helping customers who otherwise couldn’t make an important purchase, but to get the most out of your second look program, the same rules apply. The application process must be quick and seamless across channels. Beyond seeking second look providers that are technologically flexible, leading providers have established partnerships with prime financing issuers to enable an automatic application after a credit denial. Third-party partnerships with fintech solutions like Vyze and Versatile Credit’s Web Credit Cascade also enable leading second look providers to integrate the second look application with retailers’ POS solutions and prime issuers.

Lines of credit are potentially even more valuable for second look customers, as it eliminates the sometimes-stressful application process for a credit-impaired shopper when making follow-up purchases. Because they have already been approved and have available funds to spend, prime and second look lines of credit encourage shoppers to come back to the store for their next big purchases.


Loyalty programs come in many forms, but leveraging a well-executed payment program is an easy solution to ensure satisfaction with your customers so that they will return. Quick, secure checkout is important, but extending the ability to walk back in with financing at their disposal helps to create a frictionless experience every time they shop. Ensuring that this perk extends to the nearly half of Americans who otherwise can’t qualify can go a long way in creating an even larger and more satisfied base of returning shoppers.

Joseph Ferguson is the Director of New Business Development at Fortiva Retail Credit, the only second look consumer financing program serviced by a publicly traded company with decades of experience servicing credit-challenged consumers. (Fortiva Retail Credit accounts are issued by The Bank of Missouri, St. Robert, MO, Member FDIC.) He may be contacted at

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