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During a recent retail co-branded credit card client engagement, it became clear to me that retail co-branded credit cards are generally behind their bank credit card counterparts when it comes to the utilization of digital channels for the purposes of securing new cardholders. It is time for retail co-branded credit cards to take notice and actively explore and utilize digital channels to extend their reach to where their potential cardholders reside. It is increasingly important to communicate and reach out to consumer cohorts differentially, as seen in Bond’s Loyalty Report 2019.
Consumers continue to be bombarded with lucrative and enticing credit card acquisition offers from existing and new credit card players. But are those offers effectively reaching their intended audiences? Historically, credit card issuers have used traditional communication channels to reach prospects, such as—but not limited to—mass media, direct mail, email lists, merchants/partners, and experiential marketing. While many of these channels have been effective in the past, they have been overused and are less and less effective due to consumer channel apathy. Prospects, particularly digitally savvy prospects, are spending their time in digital channels, especially Gen Z and young Millennials. As such, retail co-brands need to consider diverting their credit card acquisition spend to marketing communication channels that are more relevant to their intended target audiences.
Brands that seek to expand their cardholder bases must begin to test new digital channels to reach prospects and optimize their COA. The following digital channels should be in every retail co-branded credit card issuer’s consideration set:
1. Paid Search:
Chase knows their Freedom card’s main value proposition is cash back, and they use it to drive search performance: Search for Chase Freedom or cash back credit card and try to find a first page result that doesn’t mention them. Here are several reasons why this digital channel is becoming increasingly important to acquire cardholders:
Key Success Factors
Discover Card uses social media by turning mundane topics into engaging content and by replying to DMs and comments within minutes. There are several good reasons to begin to harness social media to acquire cardholders:
Key Success Factors
Some credit card brands have begun to use podcasts to reach prospects. Chase provides business advice from the Chase Ink business card on the Shark Tank-esque show, The Pitch. Capital One talks about their card’s trendy restaurant rewards on the Millennial targeting, “How I Built This.” Test ads on a variety of shows to learn which audiences respond best. Use offer codes and custom URLs to test unique and time-sensitive offers. If podcasting drives acquisition, a long-term goal may be to work with Gimlet on a custom show. Some other current examples include MasterCard’s “Fortune Favors the Bold” and Interac’s “Earning Curve.” Explore podcast marketing for acquisition for the following reasons:
4. Influencer Marketing
Amex’s #AmexAmbassador program ties card benefits to curated accounts, like travel insurance while they’re away, or perks for in-demand theatrical shows. We know the power of influencer marketing, and credit card issuers are beginning to use this for acquisition and engagement. Here are the reasons why there is merit in this digital channel:
Key Success Factors
As you can see, there are several new digital channels that retail co-brand credit card marketers should be using. Retail co-branded credit card issuers need to work with their retail branded partners to find the optimal mix of digital communication channels by diverting acquisition dollars to test and learn in these new channels. It is vital that they work together in lock step and have a solid measurement plan in place to identify the efficacy of each digital channel in relation to traditional channels.
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