Affluent Consumers Carry the Most Credit Cards

Affluent Consumers Carry the Most Credit Cards

According to the STORES Magazine 2003 Consumer Credit Survey, conducted by BIGresearch, the average consumer has at least two credit cards in his wallet; affluent consumers have several more. The majority of consumers carry VISA (64%), and nearly as many carry MasterCard (54%). Ranked third was the Discover Card (24%), and 11 percent hold American Express cards.

Rick Gallagher, NRFVice President and Publisher of STORES Magazine, said "The study demonstrates that people are using debit cards responsibly, using them for consumables like grocery and gasoline," he said. "Consumers are clearly using debit cards as a replacement for cash and checks."

"Consumers are clearly changing the way they shop," said Phil Rist, Vice President of Strategy for BIGresearch. "Understanding how consumers choose to pay is the first step on the path to improved marketing campaigns, more precise targeting of rewards and understanding what motivates the consumer to make a purchase."

The study also addresses the effectiveness of incentives for consumers when choosing payment options such as lower interest rates, cash back, airline miles and rewards programs.

Key findings of the survey:

  • VISA is the most popular card to own (64%) and use (42%) for personal purchases.
  • Most consumers said they would be motivated to use a credit card if their interest rates were lower (62%). Cash-back (51%) was the second largest motivator and rewards/points programs (40%) were third.
  • Women are more likely than men to use debit cards.
  • Most consumers use a credit card (41%) when purchasing big-ticket items such as furniture or electronics.
  • The majority of consumers prefer using cash (33%) or their debit card (32%) when purchasing groceries.
  • Consumers were fairly split on how they buy apparel with 25 percent each choosing cash, debit card and credit card.
  • When paying utility bills, the majority (72%) chooses checks, with 9 percent choosing debit cards.

    The survey finds that the average consumer has at least two credit cards in his wallet; affluent consumers have several more. These shoppers, who report an annual household income of $50,000 or more, have more credit cards than the average shopper and tend to exercise those cards more frequently. Affluent shoppers are more likely than other customer segments to possess store credit cards.

    The research reveals that the largest share of affluent shoppers are between the ages of 35 and 54, a time that typically coincides with peak income. Specifically, 39 percent of consumers in this age group have household incomes starting at $50,000 and ranging beyond $150,000. Still, underestimating the wealth of consumers at either end of the age spectrum is a mistake. Twenty three percent of shoppers ages 18 to 34 and 23 percent of those 55 and older report household incomes between $50,000 and $99,999.

    Shoppers' proclivity for store cards suggests an opportunity for retailers to drive more frequent usage. Retailers often persuade shoppers to acquire a store card by offering 10 percent to 15 percent off a sale item. But it appears that all too often the relationship ends there. Shoppers are not re-using the cards, a reaction that may be linked to the high interest rates associated with store cards.

    Credit Cards Held
    50K+ HouseholdsAll Households
    American Express20%11%
    American Express Blue96
    Diners Club11
    Discover Card3124
    Master Card6654
    Store Credit Card3227
    Credit Cards For Business Expenditures
    50K+ HouseholdsAll Households
    American Express10%4%
    American Express Blue11
    Diners Club00
    Discover Card22
    Master Card87
    Store Credit Card01
    Don't Have Business Card6373
    Credit Cards Used Most for Personal Expenditures
    50K+ HouseholdsAll Households
    American Express1%1%
    American Express Blue96
    Diners Club00
    Discover Card99
    Master Card2523
    Store Credit Card23
    Don't Have Credit Card1119

    Source: BIGresearch, STORES 2003 Consumer Survery

    You can find out more here.

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