The Cards Market Continues to Deliberate on the Future of Co-branding While Interchange Regulation Begins to Manifest, According to Auriemma Consulting Group Survey
(Thomson Reuters ONE) -
LONDON, Aug. 12, 2015 (GLOBE NEWSWIRE) -- 2016 is likely to be a pivotal year
for the UK's credit card market as issuers realise the full impact of
interchange reduction on profitability. In recent months, response strategies
have become clearer, and a number of issuers have cut-back or entirely removed
rewards programmes.
Consequently, within the co-brand market, there is a heightened sense of caution
as both issuers and partners work to maintain a compelling and profitable
customer proposition.
Despite the pressure of a reduced value pool, co-branding still remains an
important element of the credit card market. With a number of issuer programmes
having their benefits reduced, customers are increasingly likely to find better
value from retail propositions who have a lower cost of providing benefits than
traditional issuer led rewards.
"Customers highly value the rewards offered by co-branded cards and despite the
more testing economics, issuers and partners must work together to deliver on
customer expectations," said Mark Jackson, Managing Director of ACG's
International Partnership practice. "Engaged cardholders are much more loyal to
the partner's brand, buying more products over a longer period of time, while
improving the underlying performance of the partner's business. Those that can
retain a strong proposition and marketable customer base will be best positioned
to reap the benefits of a successful partnership."
Impending regulation could ultimately galvanise the industry and we may see a
number of issuers and partners positively altering the construct of propositions
rather than simply diluting rewards. A mindset shift is required to be able to
operate in the new environment - ACG recommends that partners discover the true
motivational factors that drive cardholder spend and focus their programmes
around this.
ACG constantly supports partners and issuers in navigating through the
regulation process with engagements ranging from strategic reviews and programme
launches to programme optimisation and new product development. Our range of
engagements allow us to deeply understand how different businesses are affected
by regulation and advise how individual programmes can adapt most effectively.
About Auriemma Consulting Group
ACG is a boutique management consulting firm with specialised focus on the
Payments and Lending space. We deliver actionable solutions and insights that
add value to our clients' business activities across a broad set of industry
topics and disciplines. Founded in 1984, ACG has grown from a one-man shop to a
nearly 50-person firm with offices in New York and London. For more information
about ACG's International Partnership practice, please contact Mark Jackson at
0207 629 0075 or mark.jackson(at)acg.net.
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Source: Auriemma Consulting Group UK, Ltd. via GlobeNewswire
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Unternehmensinformation / Kurzprofil:
Datum: 12.08.2015 - 17:49 Uhr
Sprache: Deutsch
News-ID 413285
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