Study: Few Credit Card Holders Use Benefits

  • January 11, 2010
Although cardholders give positive marks to the concept of credit-card funded merchant discounts, very few actually use them, according to Cardbeat, a syndicated market research report published by Auriemma Consulting Group. The company surveyed 419 credit card users in November 2009.

"The gap between consumers' positive reaction to the concept and the lukewarm reaction to the execution suggests that issuers have not found the right combination of merchant brands and offers, or haven't communicated them effectively," says Nancy Stahl, editor of Cardbeat, in a statement.

Consumers place the highest value on discounts based on stores where they shop and for everyday items, such as gas and groceries. "However, few issuers seem to have cracked the code for how to turn the idea into a reality that actually motivates consumers the way co-branded reward programs do," she says.

Credit score information suffers a similar fate. Consumers like the idea of getting information about their credit score and how to improve it, but those who've used this benefit are not impressed with what they got. "With card profitability under pressure, issuers need to make sure they are getting the most bang for their marketing bucks," Stahl says. "Over-promising and under-delivering may be worse than not offering the benefit at all."--Tanya Irwin

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