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Credit Card Wars & The Battle For Long-Term Loyalty

August 6, 2020 Melissa Ledesma

Even before COVID-19 reshaped most aspects of the consumer experience, nearly all generations from Baby Boomers to Millennials gravitated toward personal credit cards as their preferred form of payment. As consumer values continue to evolve, and the interest for contactless and electronic payment methods rise, the credit card wars have been reignited, and the battle for market share and long-term loyalty among credit card brands remains fiercely competitive. 

While consumer spending habits evolve, competition from alternative buy now, pay later (BNPL) fintech companies and online personal finance brands is growing. Banks and major credit card brands, like American Express, Capital One, Discover, Chase and Citibank, are pivoting their brand messaging, personal credit card incentives and charitable partnerships to meet the new needs of their target audiences. 

COVID-19 Closures Have Consumers Saving More & Spending Online

According to June data reports from the Bureau of Economic Analysis, consumers have had tighter than usual budgets in 2020, and the majority of Americans are spending less and saving twice as much. However, the heightened interest in saving is not solely supported by employment factors. Since March, most consumers across the U.S. have had fewer spending opportunities than are typically available. Higher-priced experiences, such as travel and entertainment, have largely been shut down for nearly six months, and options for dining out are limited. According to the U.S. Federal Reserve, revolving consumer debt is at its lowest level since the Great Recession, falling to $996 billion nationwide in May. 

Although brick-and-mortar sales in most industries fell in the first half of 2020, consumers spent $368.8 billion via online transactions. According to the Adobe Digital Economic Index, consumer online spending soared from March to May, and, even with a slight dip, still remained above typical holiday season spending in June. The Adobe report estimates $77 billion additional dollars were spent online during the period of March to June 2020, compared to 2019. And, of course, credit cards are the primary payment method for online transactions.

Credit Card Marketing Campaigns Shift To Match Consumer Values & Needs

As credit card brands compete to capture, engage and retain customers, they are aligning with consumer values and sentiments in new ways to reaffirm their understanding and connections with their target audiences. Here are some ways major credit card companies have repositioned their marketing messages and efforts to reach new audiences and maintain relationships with current customers during the coronavirus pandemic. 

American Express Partners With NBA To Replace Sport Jerseys

The moment a favorite player is traded can be incredibly frustrating for a sports fan, especially for fans that have jerseys with the traded player’s name on them. American Express created a solution to that problem just in time for the return of the basketball season, partnering with the NBA to provide a unique offer to cardholders. According to the NBA store, the jerseys purchased online at the NBA store website are now “trade resistant,” meaning any American Express cardholder who uses their AmEx to buy an NBA jersey can get a replacement jersey for free if their player changes teams within a year of purchase. The page promoting the NBA jersey replacement plan included the headline: “Don’t buy a jersey without it.” 

AMEX It's So Easy from fanatics on Vimeo.

Chase Connects With Home Chefs & Recent Grads 

Chase identified partnerships that were used to engage their existing and upcoming user bases:

  • Chase Sapphire Partners With Eater To Host ‘Nights In’ On Instagram Live

With most restaurant dining on hold, Chase Sapphire had to get creative to engage its new community of at-home chefs. Known for its double and triple dining-related rewards points, in May, Chase Sapphire re-established its connection to the food industry and partnered with food and dining website Eater to host a five-day programming series on Instagram Live. “Nights In” featured world-renowned chefs, food industry entrepreneurs and celebrity foodies. To aid food scarce communities and struggling restaurants, Chase committed to promoting the vital services offered by the World Central Kitchen, a not-for-profit that provides food relief during times of crisis or devastation. Eater committed to matching all donations made during the live stream and, through collective efforts, Chase Sapphire and Eater raised more than $2 million from May 4 to May 8 for the World Central Kitchen. 

  • Brand Ambassador Kevin Hart & Celebrity Friends Ask Grads To #ShowMeYourWalk

Because consumers must be at least 18 years old to get approved for their own personal credit cards, many young adults are first introduced to credit card offers while they are in college, as credit card brands aim to engage consumers early on in the hopes of building long-term loyalty. With virtual learning keeping students at home and traditional graduation ceremonies on hold, Chase created a memorable experience to connect their brand to young adult audiences. Hosted by brand spokesperson Kevin Hart, Chase brought together a group of celebrities to host a virtual graduation ceremony in May. Promoting the #ShowMeYourWalk hashtag, Chase encouraged grads to commemorate their achievements during a time of social distancing and send in videos of their graduation walks. Top submissions were featured on Chase’s Instagram, Twitter and Facebook pages. On Instagram alone, #ShowMeYourWalk was used more than 4,000 times as part of UGC posts. 

Capital One Is Serving Consumer Content To Build Financial Literacy

To resonate with the new needs of their target audience, Capital One launched the Learn and Grow financial literacy page in March, with content, including coronavirus-related financial scams and stimulus check best practices, promoted across social media channels. Furthering its commitment to increasing financial literacy, in June, Capital One announced its partnership with NFL linebacker Bandon Copeland as part of a cooperative goal to raise awareness of the impact of stress on financial decision making. 

Discover Encourages Equality For All With #EatItForward Campaign

Discover launched its latest campaign in July, bringing together sentiments from the COVID-19 economic downturn and America’s renewed focus on the importance for social justice and equality. When describing the motivation behind the “Eat It Forward” campaign, Discover’s Executive Vice President and President of U.S. Cards Julie Loeger said, “COVID-19 has wreaked havoc on businesses across the United States, and we want to help effect positive change by offering financial support to Black-owned restaurants, a segment of the economy that has been disproportionately impacted during this pandemic.” From July 13 through October 31, Black-owned restaurants have the chance to win $25,000 as part of the “Eat It Forward” campaign. To participate, consumers must use the #eatitforward hashtag and tag @Discover alongside the Black-owned restaurant or food establishment of their choice. Loeger noted that consumers who share the names of Black-owned food establishments on social media give small businesses essential marketing promotion at a time when they need to connect with new customers to maintain their businesses.

Citibank Promotes Access To Answers & A Seamless Online Banking Experience

Since March, Citibank reaffirmed its brand messaging related to its commitment to offering consumers easy access to their financial tools. With many businesses closed during COVID-19, consumers faced frustrations due to limited customer service and support options. On all of its social media pages, Citibank promotes the efficiency and simplicity of its mobile brand. Even though many brick-and-mortar Citibank locations were closed or shortened their business hours, Citibank wants consumers to still feel secure with the Citibank mobile app providing access to all of their credit card and banking functions. Graphics promoting the mobile app feature older consumer segments to reinforce that the app is not only useful to younger or tech-savvy consumers with the caption, “The speed you need with the simplicity you want.” In addition to increasing the promotion of their mobile app, Citibank encourages consumers to get answers quickly by tagging @AskCiti on Twitter and submitting their questions via tweets. 

From Relief To Relatability: Credit Card Brands Remain Focused On Maintaining Customer Loyalty

During the earliest months of the global pandemic, many major credit card brands took action and quickly altered their rewards programs to fit new shopping habits and instated relief programs to help credit card users feel financially secure. Being nimble and flexible was essential to credit card brands maintaining their customer relationships. As the effects of COVID-19 continue to shape many aspects of consumer behaviors, credit card marketers will need to go beyond rewards offers and promote messaging that aligns with the evolving needs of their target audiences. Consumers will likely remain loyal to the brands that have consistently displayed empathy and relatability and can continue to connect and engage target markets in the areas where they are interested, passionate and require assistance.

Whether a customer is an avid sports fan who spent months missing live games, a recent grad whose financial future feels uncertain, a budding at-home chef who is learning their way around a kitchen or simply someone looking for financial advice during an economic downturn — one thing is for certain: consumers want to feel heard and understood. Credit card marketers need to embrace the moment, listen to their customers and tailor their marketing efforts to convert credit card users into life-long brand advocates by aligning with their values. 

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About the Author

Melissa Ledesma

An innovative problem solver by nature, Melissa Ledesma is both experienced and passionate about the digital marketing industry. She has held a number of high-level positions within the real estate, mortgage, entertainment and digital advertising industries, including Director of PR and Business Development at NJ Lenders Corp. and Director of Communications & Government Affairs at Eastern Bergen County Board of Realtors. As Director of Content & Communications at Digital Media Solutions (DMS), Melissa demonstrates a strategic, creative and tactical approach when handling the thought leadership programs and marketing and communications efforts for DMS and its family of brands. She manages all conferences, sponsorships and event execution and plays a pivotal role in the creation of written, digital and video content for all campaigns. Melissa has consistently positioned the team at DMS as experts in performance marketing across multiple industries.

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