Providing market research reports, industry analysis, company profiles and country reports for strategic planning, competitive intelligence, marketing and business research.
Search for Market Research Reports:    

Product design in UK Plastic Cards - What can be learnt from Abroad?

Published by: Datamonitor

Published: May. 23, 2008 - 22 Pages


Table of Contents


Overview
Catalyst
Summary
Table of Contents
Table of figures
Table of tables
Product Design in the UK - What can be Learnt from Abroad?
Introduction
Account management is of increasing importance to issuers
One way of encouraging good account management is to reward on time payments
In the US, Discover launched the Motiva card, that rewards on time payments
In Australia, ANZ Bank has also launched a product that incentivizes the paying off of balances
Aside from reward programs, issuers can encourage disciplined account management through other product features
In the US, Wal-Mart has introduced a prepaid card to help families budget
Issuers can also help cardholders by making it easier to make payments
In the US, both Citi and Bank of America have introduced mobile banking services
Cards and Payments Team's view on cards that reward good account management
Issuers in North America have been innovative in linking card products to long-term financial commitments
One issue with this type of reward scheme is the compatibility of the mortgages of other financial services providers
In Canada, MBNA and MCAP launched a co-brand card
In the US, the largest mortgage lender has launched a credit card product
In a related move, in the US American Express has launched a product that allows cardholders to pay their monthly mortgage repayments from their American Express card
Cards and Payments Team's view on cards that are linked to mortgage products
Customer segmentation is an area in which UK issuers could learn from foreign issuers
Issuers in several countries have launched card products that are aimed specifically at men and women
In Greece, Citibank has launched a credit card aimed at male card owners
In Australia ANZ Bank has launched a website for its female customers
In the US, American Express has issued a series of cards based on location
Cards and Payments Team view on segmenting customers
The next step from customer segmentation is product individualization
Some foreign issuers allow cardholders to put a photograph of their choice on the card
Spanish and Nordic issuers have been particularly innovative in this area
Cards and Payments Team view on customizing card appearance
Issuers in the Middle East continue to have impressive personalized loyalty systems, assisted by chip based technology
Mashreqbank's WOW! Card rewards repeat purchases rather than transactional loyalty
Cards & Payments Team view on the individualization of loyalty products
A final way to customize a payment card is to allow cardholders to select their own pricing structure
In the US, Capital One's Card Lab allows cardholders to create their ideal card
Cards and Payment's Team view on products that allow cardholders to select their own price structures
Summary
APPENDIX
Definitions
Average transaction value
Balances outstanding
Charge card
Credit card
Interchange
Methodology
Primary research
Secondary research
Further reading
Ask the analyst
Datamonitor consulting
Disclaimer
List of Tables
Table 1: Current relevant Datamonitor publications, 2008
Table 2: Future relevant Datamonitor publications, 2008
List of Figures
Figure 1: The Discover Motiva card rewards on time payments, 2008
Figure 2: The ANZ Balance Visa rewards cardholders for paying off their balance, 2008
Figure 3: The Wal-Mart prepaid Visa card helps consumers manage limited funds, 2008
Figure 4: Credit cards linked to mortgage products can present a powerful proposition to homeowners, 2008
Figure 5: The MCAP card helps cardholders to reduce their mortgage terms, 2008
Figure 6: The Countrywide Visa can save cardholders more than $11,000 over ten years, 2008
Figure 7: La Caixa allows cardholders to personalize cards with their own photographs, 2008
Figure 8: Chips allow merchants to encourage repeat business, 2008
Figure 9: Chips can bring together a range of offers to make a compelling customer loyalty offering
Figure 10: Applicants can select their card features using Capital One's Card Lab, 2008


Abstract

Introduction

Part of the UK Plastic Cards 2008 series, this brief provides insight into some of the most innovative value propositions from card issuers around the world and examines how such products could be adapted by issuers in the UK. The brief examines products that encourage good account management, as well as customer segmentation and products that link payment cards to mortgages.

Scope

The brief looks at products in the US, Europe and the Middle East. Includes a detailed discussion on payment card account management, a particularly topical subject. Contains several examples of how issuers have used their cards to cross sell other financial products. Examines customisable credit cards from overseas markets, discussing how suitable such products would be in the UK.

Highlights

Issuers in the US and Asia pacific regions have created products that reward good account management. This has been achieved by designing reward programs around timely repayments in addition to transactional loyalty. In North America, several issuers have card loyalty schemes that help cardholders to pay off their mortgages by using cashback from transactions to make overpayments. While the long term benefits can be very valuable to the cardholder, there are several potential obstacles to overcome in order for an issuer to set up such a program. Card individualization has been taken to new levels by issuers in the US. Cardholders can customize the trade-off between rewards earned, interest rates charged and interest free periods to create their ideal card. However, there are pitfalls for such models, which could explain the withdrawal of the Accucard product from the UK market in 2006.

Reasons to Purchase

Find out what issuers are doing in other markets to attract and retain cardholders. Understand innovative product designs across the areas of account management, loyalty, and customer segmentation. Discover how innovations in other markets could be applied in the UK.


Get Full Details About This Report >>
US: 800.298.5699
Int'l: +1.240.747.3093
Buy this Report
Price and Delivery Options
Search Inside Report


 

About MarketResearch.com
MarketResearch.com is an online aggregator selling over 160,000 market research reports, company profiles and country profiles from over 600 research firms. Our reports will provide you with the critical business and competitive intelligence you need for strategic planning and marketing research. Coverage includes the US, UK, Europe, Asia and global markets.

 

© MarketResearch.com 2008