Tips to Tap Into Credit Cardholders’ Preference for Points
What do consumers want when selecting a new credit card?
When do they want them?
That’s according to a the recently published 2016 Citi Cards Consumer Perspectives Study, where 67 percent of respondents said a rewards-points program was an important factor in their decision when selecting a new credit card. The Citi survey found rewards more popular than interest rates (54 percent) and sign-on bonuses (28 percent).
If your institution is not already offering some form of rewards to cardholders, run, don’t walk, to get your program off the ground.
If you already have a program in place, invest the time and tools to analyze patterns in card usage and redemption to drive real results. Here are a few tips:
Tips to Tap Into Preference for Points
Audit Your Auditing Capabilities: If you have limited visibility of cardholder behavior, upgrade your tools and tracking abilities, so you have access to the right data to make informed decisions.
Analyze Transactions to Understand Behavior: Sixty seven percent of respondents to the Citi survey, who redeemed rewards points, reported using them for everyday purchases, such as groceries, while 47 percent redeem points for cash and 37 percent opted for gift cards. Analyze where and when cardholders use their cards to incentivize them to use your card more often.
Seek Out Gaps in Card Usage: Struggling to grow card usage for certain transaction types? First identify the gaps then develop a rewards strategy to stimulate usage.
Add Questionnaires to Customer Touchpoints: The Citi survey showed that nearly 40 percent of respondents prefer to use their rewards for unique opportunities, such as entertainment events. Make it easier for them to connect the dots between their points and their preferences. Then your institution will be the one rewarded with higher card usage.
Monitor What Competitors Are Doing: Keep an eye on the latest programs from other institutions. But beware and always launch programs based on sound data and strategy, and not knee-jerk catch-up reactions.
Want to learn how you can add loyalty and rewards solutions to drive customer satisfaction and generate revenue? Request a free briefing with one of our Loyalty & Rewards Specialists.
* Source: 2016 Citi Cards Consumer Perspectives Study, July 2016, Citi.