Credit Card Companies to Market Cash Back Rewards

by Mercator Advisory Group 0

ComScore has released a new study on credit card shopping behavior and notes that 20% of existing credit card customers have begun searching for a new card. Perhaps reflecting the existing cardholder base, 40% say they are seeking a low APR/interest rate, a desire which may be difficult to fulfill in a post CARD-Act card pricing environment.

Sarah Lenart, comScore vice president of financial services, says “we’re also seeing a corresponding increase in retail and e-commerce spending along with increased card shopping, especially among those in the subprime sector.” However, consumers may be more cautious about the types of credit cards they sign up for after having experienced a period of financial difficulties. In addition, about 80% of consumers with household incomes of less than $100,000 say that inflation will impact their spending this year.

The study also notes the appeal of cash back rewards on credit cards, a motivation that has been consistently shown in Mercator’s CustomerMonitor Survey Series data in 2009 and 2010. Mercator’s data also show about a third of rewards participants trying to maximize their use of their most valued card reward program.

The importance of electronic channel marketing for credit cards is also noted in the comScore study:

Consumers use a variety of sources to search for credit cards, including search engines (36%), credit card website (28%), direct mail (19%) and credit card affiliate site (10%).

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