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Co-Branded and Affinity Credit Cards in the U.S.


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Co-branding has entered its late adolescence and is a fixture of American marketing, and increasingly so, of the global payments industry. There are literally thousands of co-branded and affinity card programs on offer. According to some industry estimates, approximately 45% of the cards in the wallets of U.S. consumers are co-branded or affinity cards.

American consumers are moving away from cash and checks as the means to purchase the things they need and want, while increasingly using plastic for shopping, and electronic vehicles to pay their bills.

The use of credit and debit cards and electronic methods (pre-authorized and remote payments) is displacing the traditional paper (cash and checks), even as the dollar volume of payments and the number of transactions expand. Consumers are migrating to card-based forms of payment (credit, debit, pre-paid cards, gift cards, benefits cards and chip-based cards), motivated in part by their convenience, enhanced services and reward programs, as well as growth of the Internet channel.

Methodology

Packaged Facts’ study of co-branded and affinity cards is based on extensive secondary research and interviews with industry and regional experts. Secondary sources include data-gathered from relevant trade, business, and government sources, including card industry journals, trade and general press (print and electronic), annual reports and 10(k) filings, company literature, consultancy publications, Packaged Facts reports, websites and white papers.

Interviews were conducted with representatives of Discover, Visa, Visa Europe, Capital One, Kroll-Info Americas, Maritz Inc., Auriemma Consulting Group and other marketing and consulting firms operating in the co-branded and affinity card space.

About the Author

An expert in primary research, Té Revesz is the principal of Revesz International and Kentera Associates. She has conducted thousands of in-depth interviews with business, political and labor experts around the world. She was featured in Super Searchers Go to the Source as one of the US’s top primary researchers. Prior to founding Kentera Associates, Té headed the Healthcare and Industrial Practices of FIND/SVP’s Strategic Consulting and Research Group and was its International Practice Coordinator. She was also a Director of FIND’s Signia Partners division. Before joining FIND, Té served at Business International as Director of North American Publications, Editor-In-Chief of its global newsletter, and helped create BI’s global risk assessment product. She also worked at Prudential-Bache’s financial planning group and at Citibank’s Washington Representative Office.

What You’ll Get in this Report

Co-Branded and Affinity Credit Cards in the U.S. makes important predictions and recommendations regarding the future of this market, and pinpoints ways current and prospective players can capitalize on current trends and spearhead new ones. No other market research report provides both the comprehensive analysis and extensive data that Co-Branded and Affinity Credit Cards in the U.S. offers.

Plus, you’ll benefit from extensive data, presented in easy-to-read and practical charts, tables and graphs.

How You Will Benefit from this Report

If your company is already doing business in the co-branded and affinity credit card market, or is considering making the leap, you will find this report invaluable, as it provides a comprehensive package of information and insight not offered in any other single source. You will gain a thorough understanding of the current market for co-branded and affinity credit cards, as well as projected markets and trends through 2011.

This report will help:

  • Marketing Managers identify market opportunities and develop targeted promotion plans for co-branded and affinity credit cards.
  • Research and development professionals stay on top of competitor initiatives and explore demand for co-branded and affinity credit cards.
  • Advertising agencies working with clients in the banking and retail industries understand the product buyer to develop messages and images that compel consumers to use co-branded and affinity credit cards.
  • Business development executives understand the dynamics of the market and identify possible partnerships.
  • Information and research center librarians provide market researchers, brand and product managers and other colleagues with the vital information they need to do their jobs more effectively.


  • Executive Summary
    • Players: Links in the Co-branded and Affinity Cards' Value Chain
      • What Makes a Successful Co-Branding Program?
    • The Market
      • Consumer Payment Preferences
        • Table Personal Consumption Expenditure (PCE) and Consumer Payments Methods, Share of Payment Volume, 2000, 2005 and 2010
      • Credit and Debit Cards in Force
        • Table U.S. Credit and Debit Cards and Transactions, 2001-2005
      • Sizing the Co-Branded and Affinity Card Market
        • Table Co-Branded and Affinity Cards: Cardholders, Card in Force, Number of Transactions and Volume, 2006
      • Are Co-Branded Cards Losing Front-of-Wallet Appeal?
        • Table Consumers' Preferred Credit Cards, 2000 vs. 2004 vs. 2006
    • The Consumer
      • Ownership and Use of Affiliation and Sponsored Credit Cards
        • Table Consumer Ownership and Use of A/S Credit Cards by Type, 2006
        • Table Trends in A/S Credit Card Ownership and Use (2004-2006)
      • Credit Card Debt
      • Delinquencies
        • Table Past-Due Payment Patterns
    • The Competitive Arena
      • Network/Brand Size and Share
        • Table U.S. Credit Card Market Network/Brand Shares as of June 30, 2006
        • Table U.S. Credit Card Purchase Volume, First Six Months of 2006 vs. First Six Months of 2005
        • Table Brand/Network Compound Annual Growth Rate in Purchase Volumes, 2002-2005
      • Industry Consolidation
    • Market Developments
      • Rethinking Under-Penetrated Consumer Segments
      • Ethnic Marketing
      • Lifestyles and Life Stages
      • Global Initiatives
      • Sports Enthusiasts and Supporters: "Fan Experience" Rewards
    • Advertising and Promotion
      • Direct Mail: Offers Increase as Response Rates Continue to Decline
    • Legal Issues
      • Issuers Move to Counteract Identity Theft Epidemic
      • Supreme Court Rules that Over the Limit Fees are Not Finance Charges
      • Going Forward
    • Where is Co-Branding Going?
  • The Market
    • Consumer Payment Preferences
      • Table Personal Consumption Expenditure (PCE) and Consumer Payments Methods, Share of Payment Volume, 2000, 2005 and 2010
      • Table Consumer Payments Methods, Share of Transactions, 2000, 2005 and 2010
      • Table Consumer Payment Preferences, 2005
      • Table In-Store Payments Mix, 1999-2005 (by percent)
      • Table The Internet Payments Mix, 2005
      • Credit and Debit Cards in Force
        • Table U.S. Credit and Debit Cards and Transactions, 2001-2005
        • Table Credit Card Applications in Response to Direct Mail Offers (2000-2005)
    • The Co-Branded and Affinity Card Market
      • Partners and Programs
        • Table Co-Branded and Affinity Cards: Cardholders, Card in Force, Number of Transactions and Volume, 2006
        • Table Rewards Card Penetration, 2002-2005
        • Table Characteristics of Rewards Cardholders
        • Table Consumers' Preferred Credit Cards, 2000 vs. 2004 vs. 2006
        • Table Incidence of Co-Branded Credit Card Ownership and Co-Branded Credit Cards by Frequency of Credit Card Usage
        • Table Co-Branded and Affinity Card Market, 2006-2011
      • The Global Co-Branded and Affinity Card Market
  • The Consumer
    • About Simmons Data
      • Index System
      • Ownership and Use of Affiliation and Sponsored Credit Cards
        • Table Consumer Ownership and Use of A/S Credit Cards by Type, 2006
        • Table Trends in A/S Credit Card Ownership and Use (2004-2006)
        • Table Demographic Characteristics Favoring Ownership and Use of A/S Credit Cards
        • Table Education-A/S vs. Regular Cardholders vs. U.S. Adults
        • Table Education-A/S Cardholders by Marketer
        • Table Household Income-U.S. Adults vs. All Cardholders vs. A/S
        • Table Household Income-A/S Cards By Marketer
        • Table Occupations-U.S. Adults vs. All Cardholders vs. A/S
        • Table Occupations-A/S Cardholders by Marketer
      • A/S American Express Credit Cardholders
        • Table Demographic Characteristics Favoring Ownership and Use of American Express A/S Cards
        • Table Demographic Characteristics Favoring Ownership and Use of American Express A/S Cards, by Type
      • A/S Discover Credit Cardholders
      • A/S MasterCard Credit Cardholders
        • Table Demographic Characteristics Favoring Ownership and Use of A/S MasterCard Cards, Overall
        • Table Demographic Characteristics Favoring Ownership and Use of A/S MasterCard Cards by Type
      • A/S Visa Credit Cardholders
        • Table Demographic Characteristics Favoring Ownership and Use of A/S Visa Cards
        • Table Demographic Characteristics Favoring Ownership and Use of A/S Visa Cards*, by Type
    • Consumer Finances
      • Consumer Indebtedness Up, Savings Down (Again), Income Flat
        • Table Consumer Saving Rate, Saving as a Percentage of Personal Income, 1995-Q3 3006
        • Table Household Debt Outstanding (billions of dollars; seasonally adjusted)
      • Credit Card Debt
      • Credit Card and the Financial Obligations Ratio (FOR)
      • Delinquencies
        • Table Past-Due Payment Patterns
        • Table Delinquency Rates, All U.S. Banks, Quarterly 1999-2006
      • Bankruptcy Filings
        • Table Annual Non-Business Bankruptcy Filings by Chapter-1995-2005
        • Table Quarterly Non-Business Bankruptcy Filings by Chapter-2002 (Q4)-2006 (Q2)
  • The Competitive Arena
    • Overview
      • Network/Brand Size and Share
        • Table U.S. Credit Card Market Network/Brand Shares as of June 30, 2006
        • Table U.S. Credit Card Purchase Volume, First Six Months of 2006 vs. First Six Months of 2005
        • Table Brand/Network Compound Annual Growth Rate in Purchase Volumes, 2002-2005
        • Table Share of Credit Card Outstandings Mid-year 2006 vs. Mid-year 2005
        • Table U.S. General Purpose Credit Cards in Circulation and Card Accounts by Brand, Mid-2006 vs. Mid-2005
      • Bank Issuers
        • Table Top U.S. Bank Visa and MasterCard Credit Card Issuers by Payments Volume and Outstandings, Plus American Express, Mid-year 2006
        • Table Top Retailer Co-branded Visa and MasterCard Credit Card Issuers by Payments Volume and Outstandings, Mid-2006
        • Table Consolidation in the Credit Card Industry: Top 10 Credit Card Issuers by Outstanding Loans 1995 vs. 2005
        • Table Consolidation in the Credit Card Industry: Top 10 Credit Card Issuers by Outstanding Managed Loans 2006
      • Industry Performance
        • Table 2006 Operating ROA by Product Type
        • Table Return on Managed Loans Select Co-brand Issuers
    • Profiles and Strategies
      • MasterCard Worldwide: Rebranded and Restructured
        • Table MasterCard Worldwide, U.S. Results Mid 2006
        • Table Processed Transactions (in millions)
      • Visa USA: Signature Platform Hosts Co-brand Programs
        • Table Visa USA Quarterly Performance Data
        • Table Visa's Co-branded and Affinity Accounts
        • Table Examples of Visa Co-Branded Credit Card Programs
      • American Express: Network, Franchisor, Issuer, Partner
        • Table American Express, Results Year-end 2006
      • Discover: Back in the Game, but About to Be Spun Off
        • Table Discover, Selected 2006 Financials
      • Bank of America/MBNA: New Affinity Model
        • Table Selected Bank of America Card Services Financials, 2005-2006 1
        • Table Bank of America's New Affinity Banking Model
      • JPMorgan Chase: Emphasis on Major Co-brand Partnerships
        • Table Chase Card Services, Selected Financials, 2005 & 2006
        • Table Sample of Chase Co-Branded and Affinity Card Categories
      • Citigroup, Re-weighting Towards the International Consumer
        • Table Citigroup Card Services, Select Financials, 2005-2006
        • Table Citigroup Card Services, Key Indicators - Managed Basis (2) (in $ billions)
      • Juniper Bank/Barclaycard US: An Up-and-Comer
      • GE Money: Targeting Retail Conversions
        • Table Dual Card Launches and Assets, 2003-2006
      • HSBC: Moving into Retail
      • U.S. Bancorp: A Strategy of Customization
  • Market Developments and Product Strategies
    • Rethinking Under-Penetrated Consumer Segments
      • Capturing Affluent Consumers
        • Table Co-branded Luxury and Other Auto Cards
      • Casting a Wider Net
      • Ethnic Marketing
      • Lifestyles and Life Stages
      • Alumni Cards Develop Reward Programs
      • Sports Enthusiasts and Supporters: "Fan Experience" Rewards
      • Airlines: Mature Category Looks to Stay Fresh
      • The Changing Retail Space
        • Table Private Label Cards Declining Share of the Card Market, 2000-2005
      • Co-Branding in the Workplace
      • Co-Branded Cross Selling
      • Global Initiatives
  • Advertising, Promotion and Acquisition Channels
    • Direct Mail: Offers Increase as Response Rates Continue to Decline
      • Table Number of Mailed Credit Solicitations and Response Rate (1990-2006)
      • Promoting Proprietary Rewards vs. Co-Branded Rewards Cards
        • Table Percentage of Mailed Credit Card Solicitations Containing Rebate or Reward Offers (2001-2006)
        • Table Consumer Attitudes Towards Solicitations and Consumer Financial Discipline
        • Table Attitudes Regarding Opt-Out Law and Government Prohibition of Credit Card Solicitations, 2004
      • Telemarketing
      • The Search for Alternate Channels
        • Table Bank of America's Card Sales Mix By Channel
        • Table JPMorgan Chase's Card Sales Mix By Channel
        • Table New Accounts, Chase Brand vs. Partner Cards
      • Media Spending
        • Table Advertising Spending in Measured Media by Top 5 Credit Card Issuers 2005)
      • Television Advertising
        • Table Advertising Spending in Measured Media by Top 5 Credit Card Issuers (by Share of U.S. Market in 2005)
      • Print Advertising
        • Table Top 2005 Card Ad Spenders by Media: Print
      • Co-Branded Credit Card Ad Spending
        • Table AmEx Co-branded Ad Spending in Measured Media* (2003-2005)
        • Table Citigroup's Co-Branded Ad Spending in Measured Media* (2003-2005)
        • Table JPMorgan Chase Co-branded Ad Spending in Measured Media* (2003-2005)
        • Table MBNA Co-branded Ad Spending in Measured Media* (2003-2005)
      • Advertising Intiatives
  • Legal Issues
    • Issuers Move to Counteract Identity Theft Epidemic
      • Table Top Identity Theft Targets (Total Incidents, 2001-2003)
      • Bankruptcy Abuse Prevention and Consumer Protection Act of 2005
        • Table Annual Non-Business Bankruptcy Filings by Chapter, 1995-2005
        • Table Definitions of Bankruptcy
        • Table Quarterly Non-Business Bankruptcy Filings by Chapter-2005-Q2, 2006
      • Federal Reserve Report on Act's Impact
      • Bottom Line for the Credit Card Industry
      • What Consumers Know and Think of Mandatory Disclosure Requirement117
        • Table Credit Card Solicitations: Opinions on Helpfulness of Disclosure Information, 2004
      • Supreme Court Rules that Over the Limit Fees are Not Finance Charges
      • Going Forward
  • The Future of Co-Branding
    • Where is Co-Branding Going?
      • New Co-Branding Frontiers: Healthcare, Virtually Virgin Territory
      • Small Business
      • Co-Branded Debit Cards
      • Contactless Technologies-The Great Enabler
        • Table Spending at Quick Service Restaurants, Cash versus Plastic
      • Next: Contactless Payment via Mobile Phone
      • Birth of the Credit-cum-Membership Card: Technology Enables Automatic Affinity Discounts
      • On-Line Fraud and Identity Protection
      • Small Payments and Smaller Payments
        • Table Small Payment Market Potential
      • Wither Rewards Programs?
      • New Rewards Constructs
      • Proprietary Bank Programs versus Co-branded and Affinity Programs
      • Best Practices

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