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Are loyalty programs driven by credit or debit card rewards? Both, depending on your member preferences, age, and demographics. Loyalty programs come in many forms, including:
- Credit Card/Full-Scale: Merchandise, cash back, travel, rebates, enterprise points are based on services; points earned for any purchase any time.
- Credit Card/Partial: More limited redemption channels than full-scale; CU may impose restrictions on how or when member uses points; some can even be merchant funded.
- Credit Card Cash Rebates: Cash rebates only; more limiting, but members often prefer cash rebates.
- Debit Card Points: First introduced by the big banks, but now declining at the banks following the Durbin Amendment in 2010.
- CU-Funded Points: Rewards funded by CU, augmented by CU promotions, i.e. CU drives promotions with double points for certain purchases or retailers.
- Merchant-Funded Rewards: Member gets points for shopping at particular stores where merchants pay for the rewards points.
- Enterprise Relationship: Awards points based on the entire CU relationship (i.e. points awarded for a car loan, mortgage, e-statements, etc.)
- Charity-Driven: Use points to contribute to a member’s favorite charity
- Dual Rewards: Member receives cash back with a credit card purchase and when they make a payment on the account
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 (http://fabproseprofessionalwriting.com), her focus is assisting credit unions and industry suppliers with their communications needs. Lisa Hochgraf is a CUES senior editor.
This is bonus coverage from “Card Rewards” in the May 2015 issue of Credit Union Management magazine.
