56% of store cardholders express interest in receiving tailored discounts and rewards based on their recent purchases, in contrast to only 44% of non-store cardholders who share this interest. This discrepancy underscores a significant opportunity for enhancing engagement through store card-linked offers.
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GLOCustomer engagement is crucial for maintaining a competitive edge in a fiercely competitive market. To achieve this, many retailers and brands have introduced loyalty and rewards programs, often linked to in-store or co-branded credit cards. While these initiatives attract customers to sign up, they fall short in motivating cardholders to use their store cards regularly.
While more than half of cardholders possess a store or co-branded credit card, a mere 12% have made a purchase using their store cards within the past 30 days. Incorporating item-level receipt data into their product development, marketing, and operations can empower merchants to create more pertinent reward programs and offers linked to these cards.
To boost the utilization of these programs, it’s crucial to offer personalized card-linked rewards. Surprisingly, 56% of store cardholders express interest in receiving tailored discounts and rewards based on their recent purchases, in contrast to only 44% of non-store cardholders who share this interest. This discrepancy underscores a significant opportunity for enhancing engagement through store card-linked offers.
These insights are part of the “Leveraging Item-Level Receipt Data: How Personalized Card-Linked Offers Drive Store Card Usage” report, a collaborative effort between PYMNTS Intelligence and Banyan. The report delves into how merchants can enhance their store and co-branded credit card programs with card-linked rewards and their impact on customer engagement and loyalty. A survey of 2,074 U.S. consumers conducted between August 14 and August 23 provided the basis for understanding consumers’ interest in these cards, their preference for personalized card-linked offers, and strategies for increasing store card use.
One effective strategy for increasing store card usage is to provide cashback programs and discounts tailored to consumers’ purchase histories. Cashback programs are particularly attractive to all cardholders, with 65% of them finding them appealing when making purchase decisions. Store cardholders, in particular, favor such programs, with 68% expressing interest.
This pattern holds true for other loyalty programs studied by PYMNTS. It emphasizes the potential for businesses to use these incentives to encourage store card owners to make more frequent use of their cards.
Among various types of store cards, consumers show the most interest in receiving personalized card-linked offers from grocery store cards. Sixty-one percent of cardholders express interest in such offers, with 44% indicating a preference for this type of card. This data indicates that consumers are more inclined to use store card-linked offers for essential items rather than discretionary spending.
Notably, almost one-third of cardholders would consider switching to merchants offering store cards with rewards and personalized discounts based on their purchase history. Overall, 27% of all cardholders are highly likely to switch to such merchants, and this number increases to 35% among existing store cardholders. Card users with children (43%) and new shoppers (40%) are the most likely to switch to businesses offering store cards with personalized discounts and rewards based on their product preferences.
While personalized card-linked offers pique consumers’ interest, merchants can benefit from targeting their loyalty programs to all customers, aiming to increase store card usage and expand their businesses. To gain deeper insights into how personalized and relevant card-linked offers can boost customer engagement, you can download the full report.
