Mass merchants are following the airlines into integrating their rewards programs with financial accounts, credit cards and prepaid cards.
I'm a huge fan of the Kroger Rewards Card, a VISA card that tracks my purchases and offers 3% back on store-branded merchandise, 2% on everything else we buy at Krogers, and 1% on other charges to the credit card. The rewards come in the form of rebate checks that can be spent on anything at Kroger's, including alcohol. A gasoline discount program is included, and I participate, but I never know what discount I'm going to get.... Is that what 'surprise rewards' means? Occasionally, I receive coupons for things I regularly buy. That conveys personal recognition, which I appreciate. This loyalty program was invented for Kroger by a loyalty marketing firm named dunnhumby.
Now Walmart is getting on the band wagon with their own 3-2-1 rewards program, integrated with either a credit card OR a pre-paid card. Interestingly, the 3% back option is offered for only for online purchases. Instead of mailing rebate cards, Walmart is crediting the cardholder account, which would be TERRIFIC, Kroger! Are you listening?
Of course, any company which can afford to run these type of programs will accumulate a mountain of data about its customers. Some will use it wisely, and some will fumble. We're looking at you, Target.