Card-Linked Offers Are Still Unfamiliar to 37% of Cardholders

man with credit card

Card-linked marketing uses past purchase data to create targeted, relevant offers to potential customers that are often presented through mobile or online banking applications. By using their credit or debit cards to subscribe to these offers, consumers in exchange get rewards, discounts or special benefits associated with their favorite brands or merchants. This marketing practice has become so popular that a recent PYMNTS Intelligence survey has revealed that 4 in 10 cardholders in the U.S. have used one of these offers in the last 12 months. However, many consumers still do not use card-linked offers (CLSs) simply because they do not know how they work.

These are key findings explored in “Leveraging Item-Level Receipt Data: How Merchants Engaged Holiday Shoppers With Card-Linked Offers,” a PYMNTS Intelligence and Banyan collaboration that examines the use of card-linked offers during the 2023 holiday season, consumers preferences for personalized offers and their interest in switching to merchants that provide them.

graphic, card-linked offers

According to the study, more than half of cardholders who have used CLOs did so to get cash-back rewards and automatically applied discounts, evidence that price is the primary reason for their merchant selection.

Conversely, hesitancy to use CLOs stems from a lack of awareness. Data on card-linked offer usage indicates that 37% of cardholders who haven’t used such offers in the last 12 months attribute this to unfamiliarity with the programs. Moreover, this percentage has decreased by 3 points since August, suggesting an increase in consumer awareness.

Additionally, data shows that nearly 1 in 5 consumers found the offers they got were irrelevant to them. To enhance interest among the 79% of potential users and 63% of those who lack of familiarity with these programs, merchants and card issuers can focus on two key actions: raising awareness of card-linked offers and improving offer relevance through better personalization based on customer preferences and needs.

Nevertheless, the efforts are still limited, and many consumers may opt for switching merchants if the offers they receive are not relevant to them. The PYMNTS Intelligence study found that more than half of cardholders were interested in switching to merchants that participated in specific card-linked offers for their holiday shopping. And this was common to both loyal and new shoppers, per the study.

Hesitance around using card-linked offers stems mostly from a lack of information, suggesting that increasing consumer understanding could increase cardholders’ usage of these offers. Merchants that personalize and tailor their product-specific card-linked offers could attract a significant number of consumers looking to benefit from rewards and savings.