The Impact of Loyalty

Even with all the buzz about digital wallets, statistics show that cards are still mighty important—and widely used—by U.S. consumers. Statistics provided by some loyalty program companies suggest that having rewards can be effective in promoting card use and deepening members’ relationship with their CUs.

Brian Day, manager/mobile products for CUES Supplier member The Members Group, Des Moines, Iowa, provides the following card use data for consideration:

• A third of U.S. consumers have one or two credit cards, and just under 20 percent have three or four cards, according to creditcards.com.
• Information about rewards vs. non-reward card programs is on p. 90 of this report about card adoption from the Boston office of the Federal Reserve.
• About 10 percent of customers switched their primary card in 2014; among those who switched cards, 42 percent did so for a better rewards program, according to JD Power.
• The average amount spent monthly on non-rewards credit cards was $333 among MasterCard survey respondents, compared to $800 for rewards credit cardholders.
• This report from creditcards.com provides interesting data on card growth trends.

Vantiv, Cincinnati, and CUES Supplier member PSCU, St. Petersburg, Fla., provided data about the impact of rewards on their clients’ members’ card use.

Vantiv reports the following:

• The average purchase ticket of a rewards member is 10 percent higher than a non-rewards member.
• The total number of sales per account is 43 percent higher with rewards.
• The total transactions per rewards credit card is 28 percent higher than for cards with no rewards attached.
• The total sales volume per debit card with rewards is 19 percent higher than one without rewards.

PSCU reports the following: Rewards card holdings spend

With 25 years of marketing and communications experience, Stephanie Schwenn Sebring established and managed the marketing departments for three credit unions. As owner of Fab Prose & Professional Writing, her focus is assisting credit unions and industry suppliers with their communications needs. Lisa Hochgraf is a CUES senior editor.

This is bonus from “Card Rewards” in the May issue of Credit Union Management magazine.