Criminals ♥︎︎ Customer Loyalty Programs

iStock_000029097234SmallS&H Green Stamps set the foundation for the customer loyalty programs we see today.

Beginning in 1896, participating retailers purchased the stamps from S&H that were then passed along to customers in accord with the dollar amounts they spent in stores. Customers then redeemed their stamps once they had accumulated enough for the item or items they wanted.

Those who collected S&H Green Stamps frequently sought to do business with stamp-issuing retailers and the customer loyalty program was born.

As the only full-service point of sale provider — from software development to franchise incubator to ongoing support — part of Sintel’s commitment to our customers and industry is to share ideas and information. Whether you’re a first-time franchise hopeful, a small business owner or an established chain, it’s always smart to stay on top of the latest thinking in customer relationship management and loyalty programs to achieve financial success.

We saw the S&H Green Stamp history mentioned in a post by analyst Jeff Orloff, “Protecting the Point of Sale.”

Orloff looks deeper into the marriage of customer relationship management (CRM) and the point of sale (POS), where today’s loyalty programs take shape only after the customer spending habits have been collected, stored and analyzed.

It’s relatively easy for retailers today to offer some type of loyalty reward program to help retain customers, market certain items and sales with more accuracy and increase profit levels. However, the tight integration of CRM and POS systems that is so attractive to marketers is also a tempting target for highly skilled criminals who can steal payment card data and also valuable customer information stored in the CRM database.

“Although there are many other ways in which an attacker can compromise data used by the CRM solution, protecting from attacks against the POS system helps by closing one door,” writes Orloff. His post includes a list of ways to defend against point of sale attacks:

– Enforce a good password policy that encompasses password diversity, not just password strength.

– Keep point of sale software and the terminal’s operating system up-to-date.

– Use encryption for mobile point of sale solutions.

– Make sure antivirus software is installed and updated on all point of sale terminals.

– Restrict Internet access for computers running point of sale software.

– Educate users on the dangers of spear-phishing e-mails, and teach users how to spot these threats.

– Have a system in place so employees are able to report suspicious activity.

– Use the right technical controls, like firewalls and intrusion detection or prevention, to stop as many threats as possible.

Orloff notes that the data used by CRM solutions is an extremely lucrative asset to criminals who understand its value. He closes the post, writing, “Protecting the POS system alone will not keep CRM data safe, but it will serve as part of the larger security plan to keep customer data from being exposed.”

Read the full post here.

For more insights into loyalty programs, check out our related posts, Creating and Rewarding Loyalty, Touched By Transactions: Building A Successful Loyalty Program, How to Successfully Create and Reward Loyalty, Securing Point of Sale’s Points of Fail.

For more insights into the relationship between retailing and information technology, check out our related posts, Shape, Or Be Shaped By IT, and For Small Businesses Owners, An Ever-Growing Reliance on IT.

Just as we share our vast point of sale point of sale experience and expertise with startup owners in order to help them make the best decisions from the very beginning, we at Sintel Systems are happy to share articles, advice and commentary about the retail restaurant market.

If you are interested in learning more about Sintel’s POS systems and how our knowledge and support can impact your future success, call us for a complimentary phone consultation.

Sintel Systems is the only direct to end user full-service provider of tailored Point of Sale systems across retail, restaurant and service industries, including frozen yogurt shopspizzeriassushi restaurantscafés and retail stores.

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