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PART III
SMART CARD APPLICATION EXAMPLES

Chapter 10
The Smart Shopper Smart Card Program
Chapter 11
The FlexCash Card: An E-commerce Smart Card Application

CHAPTER 10
THE SMART SHOPPER SMART CARD PROGRAM

In this chapter, you learn about a smart card merchant loyalty program using the 3K Multiflex smart card that comes with this book. This chapter begins by describing the program and the requirements its issuers have set for it. After that, the chapter describes and analyzes the data layout and access control architecture of the program’s smart card. Finally, the chapter walks through the specific parts of the application program that deals with the smart card.

The Story of Smart Shopper Cards

A loyalty program is a market development technique that generates repeat business by providing customers with rewards based on the total amount of business they do. Frequent buyer programs, such as the American Airlines AAdvantage Miles program, are examples of loyalty programs. Loyalty programs are very effective for merchants and very popular with customers.

As loyalty programs have grown in popularity, they have also grown in complexity and customer expectations. A small- to medium-sized merchant who decides to run a loyalty program may discover that there are many details of running an effective program with which he has neither the time nor the knowledge to deal. Furthermore, he will be interested in sharing the expense of running the program with other merchants who don’t compete with him. Thus was born the Smart Shopper loyalty program and the Smart Shopper card.

Smart Commerce Solutions Inc. is the imaginary card issuer for a multiple-merchant smart card loyalty program called Smart Shopper. Here’s how Smart Shopper works: Consumers join the program by purchasing a Smart Shopper card from any participating merchant. The Smart Shopper card comes in two sizes—a 5-merchant card that costs $15.00 and a 15-merchant card that costs $30.00. Smart Commerce Solutions is using Schlumberger’s 3K Multiflex (just like the one included in this book) for the 5-merchant card and Schlumberger’s 8K Multiflex card for the 15-merchant card. If the consumer participates in only a few, selected loyalty programs, she would purchase the 5-merchant card. If the consumer is a professional shopper who collects frequent buyer points wherever she goes, then she would purchase the 15-merchant card.

After purchasing a Smart Shopper card, the consumer can ask the merchant from whom she purchased the card—or any other merchant participating in the Smart Shopper program—to put his loyalty program onto the card. As soon as this is accomplished, the customer is participating in the merchant’s loyalty program.

Each merchant loyalty program is allocated 450 bytes of nonvolatile memory on the Smart Shopper card. In this space, the merchant can provide customers with one or more of the prebuilt loyalty schemes provided by Smart Commerce Solutions. The following are examples of the predefined schemes that the merchant can use to define his own loyalty program:

  Frequent buyer points—Accumulate points toward rewards based on the total amount of purchases made with the merchant.
  Cumulative purchasing—Keep track of the total amount of purchases of a particular product in order to qualify for volume purchase discounts.
  Want list—Store lists of desired but infrequently available items such as particular book or video tape on the card that the merchant can instantly match against current inventory.
  Personal preferences—Store personal preferences and requirements such as colors, sizes, and brands on the card so that the merchant can quickly tailor product offerings to the customers’ demands.
  Revisit coupons—Store discount coupons on the card that can be redeemed at points in the future to encourage the customer to return.

Besides selecting options such as rewards for total purchases versus frequent visits in the various programs provided by each merchant, consumers purchasing the Smart Shopper smart card can, at their option, enter personal profile data that can be used by all merchants. Such data can, for example, include the cardholder’s name, home address, business address, telephone and fax numbers, email address, and even credit card account numbers and sizes.


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