Credit Campaigning to the Rhythm of the Market … and the Consumer

Kris Carrera
Business Line Executive, Credit
Posted on February 14, 2017

Maximizing credit card usage at peak purchasing moments with new ways to repay

Have you contacted your credit card provider or processor for more ideas on how to better reach your customers?

Better deals, more flexible payment options, better-targeted offers and rewards, emerging mobile payment mechanisms and more are giving consumers more and more reasons to pay with something other than their established financial institution’s credit card. With so much competition for each consumer, how can a financial institution keep a relationship within the credit family?

Credit cards remain a staple, but providers must remain vigilant to the dangers of being sidelined by competitors. Here’s how issuers can work to reverse the current trend and keep credit card relevant.

Peak Performance

Credit card usage is not a constant stream of transactions; there are periods of large numbers of high-value payments offset by phases of relative tranquility. But given that the peaks are readily identifiable, financial institutions can leverage this to better time their campaigns and ensure that the offers of discounts and loyalty rewards are matched with the time of year.

Credit card providers do not reward normal behavior, they are looking to encourage new buys above and beyond the norm. By making special offers in the form of targeted discounts or other rewards that coincide with peak spending seasons, they can proactively encourage increased usage.

December, of course, is always a peak period for card usage as people prepare for the holidays, but there are others. Why not offer consumers big discounts at florists and chocolatiers during the weeks leading up to Valentine’s day? In the weeks before the Super Bowl or soccer’s World Cup, why not offer double rewards or extended reductions on big-screen TVs to ensure the purchase is put on the card? March and April – peak months for travel shopping – consider offering travel insurance reductions over to spur sales.

Of course, while many of these annual peaks in card usage apply across all demographics, some are customer dependent. The annual kids-returning-to-school peak only applies to family-oriented customers, so target them with offers rather than blanketing the market. The kids-going-to-university peak spending moment applies to those with children of the appropriate age – you have the customer data, use it!

Repayment Responsiveness

Hitting spending peaks is only part of the story; you also must rethink how cards can be used by customers, how debt is repaid and the incentives employed to encourage continued use. Traditionally, consumers either paid off their entire credit bill at the end of each month (transactors) or carried some percentage of the credit line into the next month (revolvers). But what if there were a third way to supply customers with credit?

Some items – cars, home renovations, high-end technology, even vacations – are simply too expensive for people to put on a credit card. Instead, they turn to personal loans to finance the transactions. But what if your credit card permitted clients to spread the cost of a big item across 12 monthly payments. Or what if the card holder permitted their clients to skip a monthly payment in order to bridge a temporary cash flow issue? This kind of flexibility, dependent on credit rating, has proven to be a very attractive option to many consumers. It bypasses the hassle involved in taking out a personal loan, and consumers can earn a huge number of loyalty points from such a large purchase. Meanwhile, you keep that consumer in the family, spending their credit lines maximally.

The Rhythm Method

What can banks do to optimize credit card usage? First, you must understand your customers so you can lock into their life rhythms and leverage the hype of seasonal peaks to maximize offers to spend when they are most receptive. Then, tie in marketing promotions to match these peaks, and create new (re)payment plans with interesting and relevant reward schemes.

If a customer leaves for an alternative payment mechanism for certain classes of purchase, or if they prefer an emerging alternative, they tend to stay there. That’s why it’s imperative to act before they go.

For instance, the millennial generation is notoriously averse to credit, and banks risk losing traction with this large, financially powerful demographic. Multiple gimmicks have been tried to add a “cool factor’’ to credit cards, including issuing designer cards made from metal. But it all can be simpler than that: stay relevant by mapping out the payment peak rhythms of the market, and introduce more flexible payment plans that will reposition the credit card as a safe, proven and practical choice to a changing landscape.


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Kris Carrera
Business Line Executive, Credit

With over 25 years of international payments experience, Kris was responsible for the launch of the first successful cobranded card program. A leader in risk-based pricing and target marketing using predictive data analytics, she specializes in merchant services, credit cards and home equity. Kris has received Best Travel Card, Best Cobranded Card and Best Private-Label Program awards.