More Than Half of Co-Branded Card Holders Want Better Offers

Customer engagement is key to staying ahead of the pack in a highly competitive market, so numerous merchants and brands offer loyalty and rewards programs, many tied to store or co-branded credit cards. Although these offerings are enough to entice consumers to register, they are missing the mark in motivating store card holders to use the cards to make purchases on a regular basis.54%: Share of card users who own a co-branded or store card

More than half of card holders said they own a store and/or co-branded credit card, yet only 12% made a purchase using their store cards in the last 30 days. Integrating item-level receipt data into their product development, marketing and operations can enable merchant to provide more relevant reward programs and card-linked offers.

Card-linked offers that provide personalized rewards have the best chance at increasing consumer use of these programs. Fifty-six percent of store card holders said they are interested in personalized discounts and rewards based on recent purchases, while only 44% of card users without a store card said the same. This contrast illustrates that there is a bigger opportunity to increase engagement through store card-linked offers.

These are just some of the findings detailed in “Leveraging Item-Level Receipt Data: How Personalized Card-Linked Offers Drive Store Card Usage,” a PYMNTS Intelligence and Banyan collaboration. The report examines how merchants using item-level receipt data can enhance their store and/or co-branded credit card offerings with card-linked reward programs and their impact on consumer engagement and customer loyalty. We surveyed 2,074 United States consumers from Aug. 14 to Aug. 23 to learn about their interest in using these cards, their preference for personalized card-linked offers and what merchants can do to increase store card use.12%: Portion of card users who used a store or co-branded card to pay for a purchase recently

Merchants could increase store card use by offering cash back programs and discounts informed by consumers’ purchase histories.

Cash back programs are the most appealing type of loyalty program for all card holders — and store card holders are particularly receptive to the programs. While 65% of all card holders said they find cash back programs attractive when choosing how to pay for their purchases, 68% of store card owners said the same.

This pattern is consistent across other loyalty programs PYMNTS studied. It highlights the opportunity for merchants and brands to leverage such incentives to encourage store card owners to use their cards more.

Among all the different stores that offer store cards, consumers are most interested in receiving personalized card-linked offers from grocery store cards.

Sixty-one percent of card holders are interested in receiving relevant store card–linked offers from grocery store cards, with 44% saying they would be most interested in receiving offers for that type of store card. Data suggested that consumers are more interested in using store card–linked offers for essentials than for discretionary spending.44%: Share of consumers most interested in receiving store card–linked offers from grocery stores

Almost one-third of card holders would switch to merchants offering store cards with rewards and personalized discounts based on purchase history.

Overall, 27% of all card holders are highly likely to switch to merchants that provide store cards with personalized offers, as are 35% of current store card owners. Card users with children (43%) and new shoppers (40%) are the most likely to switch to merchants offering store cards with personalized discounts and rewards based on the products they buy. Merchants need to provide the card-linked offers and programs consumers are most interested in to limit the number that switch.

Despite consumers’ interest in card-linked offers, merchants could benefit from targeting their loyalty programs to all consumers to increase store card use and grow their businesses. Download the report to learn more about how personalized and relevant card-linked offers can drive customer engagement.