Walgreens has announced that customers who have signed up to its Balance Rewards loyalty program can now redeem their rewards with Apple Pay, making it the first retailer to take advantage of the new feature integrated into Apple's mobile payments system with the release of iOS 9.
The development eliminates the need for Walgreens customers to scan their physical Balance Rewards loyalty card or a QR code to be able to earn and redeem loyalty points by simply swiping their Apple Pay-equipped iPhone or Apple Watch over the point-of-sale terminal.
"We're excited to be the first to provide our customers with increased ease of access to their Balance Rewards account and information when using Apple Pay," Sona Chawla, president of digital and chief marketing officer at Walgreens, says in a statement. "This offering supports our commitment to removing friction and enabling a simple and convenient customer experience."
Users will need to add their Balance Rewards card into Apple Pay via the Wallet (formerly Passbook) app, in the same way they add their credit and debit cards. When making a purchase they simply have to swipe their iPhone over the credit card reader with a finger over Touch ID to redeem their rewards, before swiping again to pay for their purchase. Apple Watch users will have to click the device's side button twice, tap the Balance Rewards card and swipe the face of the watch over the terminal.
The process is not exactly exciting or revolutionary, and where customers previously had to swipe once, they now have to swipe two times. It's not exactly hard to do either though, and it takes Apple Pay one more step closer to becoming the ultimate digital wallet, allowing customers to replace their credit cards, debit cards and cash, and now their loyalty cards, with a smartphone or a smartwatch.
The question, however, is whether customers will pick up their iPhones to redeem their Walgreens rewards. More than 85 million people are part of the drugstore chain's loyalty program, but only 14 percent of U.S. households with credit cards have signed up for the mobile payments service, according to marketing research firm Phoenix Marketing International. The firm adds that while Apple Pay continues to grow, the growth rate has declined over the last few months.