Reward Cards Grow In Popularity

The reward card program has been a successful way for the credit card industry to reach consumers on a national level. Not only are credit card companies succeeding from the reward card program, but it is capturing the attention of consumers as well. Since there are at least a couple of credit cards per household, having a reward card offers new benefits for the cardholder to experience. A record high of 6.06 billion credit card offers were mailed out in 2005. However, only 18 million offers were actually answered and accepted. The low response from the public prompted the credit card companies to come up with better benefits for the credit card holder. So offering a credit card by promising rewards and rebates proved to be an immediate success.

 

In the mid-80's, the idea for a reward card came from Discover when they offered cash back with every purchase. Soon other major credit card companies were catching on and American Airlines teamed up with Visa and offered frequent-flier miles for every dollar that the cardholder spent. Since then, credit card issuers have created a wide variety of reward programs. Today the typical reward credit card offer is a penny back for every dollar that the cardholder spends. Whether in the form of cash, purchases on goods or services, the reward card gives back to the consumer. Thus the goal is reached for the reward card with the cardholder's spending and loyalty to the program.

 

Other than rewards, the credit card industry has used other techniques to get the consumer's attention. One techinique was to offer a choice of credit cards ranked by the color of the card; gold, platinum, and silver. This appealed to the cardholder because it suggested that the company giving a special status card, a reward. Another marketing tactic was to offer consumers a wide selection of "affinity cards". Each card features an image that consumer's like whether it's personal taste, to a hobby, and sports favorites as well. The affinity card remains popular with consumers but is even more popular when linked to a reward program.

 

Studies prove that more people choose a credit card with a reward program over any other feature including the credit limit and interest rate. The benefits of the reward card has the consumer satisfied and the credit card companies succeeding. With the variety of reward card offers to choose from, consumers can find the one that fits their lifestyle. It is no wonder that the popularity of reward cards has increased and should remain popular in the future.