Special offer: now 20% off original price of $3,750
The market for co-branded and affinity cards is over two decades old. Issuers have worked to make payment cards more attractive to cardholders through value-adding initiatives such as rebates and rewards. This has been a major growth driver in the co-branded and affinity card space over the past few years, but there is some evidence that the pendulum has begun to swing in favor of proprietary bank reward programs. In the U.S., where the market for co-branded and affinity card is extraordinarily mature, experts interviewed by Packaged Facts estimate that between one quarter and one third of the plastic held by Americans are co-branded or affinity cards. And because co-branded and affinity credit, payment and debit cards have become such an integral part of the U.S. card industry, the growth of this market cannot be separated from the shift in consumer payment preferences from paper to plastic and electronic vehicles, and from the huge expansion in U.S. consumer indebtedness. Other forms of mobile payments, such as contactless cards, mobile phones and contactless watches are gaining traction. As the U.S. market matures-and possibly plateaus-issuers are seeking new growth opportunities in Europe, Asia and other regions. However, there are wide variations in the extent to which consumers, issuers and merchant partners in the various national markets have embraced co-branding. Scope of the Report Packaged Facts' 2009 report, Co-Brand and Affinity Credit Cards: The U.S. and Global Markets and Opportunities, 3rd Edition, examines how the market and players have changed over the past two years, and answers important questions including:
Read an excerpt from this report below. MethodologyPackaged 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. Packaged Facts' analysis of consumer behavior and demographics derives from the our Custom Online Survey of 2,606 adults, Experian Simmons Market Research Bureau's (New York, NY) adult consumer surveys, which are based on approximately 25,000 respondents age 18 or over. About the Author An expert in primary research, Therese (Té) Revesz is the principal of Revesz International LLC. 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 U.S.'s top primary researchers. Prior to founding Revesz International, 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-Brand and Affinity Credit Cards: The U.S. and Global Markets and Opportunities, 3rd Edition 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-Brand and Affinity Credit Cards: The U.S. and Global Markets and Opportunities 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 2012. This report will help:
Market Insights: A Selection From The Report Europe Co-branding Market: “Hugely Different from the U.S.” There are 60 million co-branded and affinity cards across Europe, Carol Stanton, Vice President and Head of Co-branding for Visa Europe told Packaged Facts in August 2009. The largest market is the U.K., which is based on the market in the U.S. The other big markets in Europe are Turkey, Spain, and Germany. These are Visa Europe’s top four co-branding markets in terms of card number and sales volume. It just happened that some small countries have high penetration of co-branded cards, but they just don’t have large populations. “In that group,” added the Visa Europe VP, “I would place Israel, Switzerland, and Ireland.” “Co-branding,” said Stanton, “correlates very strongly with the success of revolving credit; if you’ve got a strong market for revolving credit, co-branding tends to function well there.” But, she added, “it is not widespread across all of the markets in Europe.” This is not just a Visa view, payment card expert Roy Stephenson underscored that other than the U.K., “Europeans largely don’t use credit cards; credit cards have never achieved substantial market penetration or social acceptance” the way they have in the U.S. Very often what people refer to as a credit card in most of the European countries is actually a “deferred” or “delayed” debit.” Stephenson (co-branding consultant) continued, “Focus groups show that consumers in Germany, France, and most other European countries are very nervous about credit cards.” They are afraid users will not be able to withstand the “temptation” of the readily available buying-power. Furthermore, since credit cards are somewhat frowned upon there is question of “social embarrassment. What if they present a credit card to pay for their weekly groceries?” In the NewsIn a Maturing U.S. Co-Branded and Affinity Credit Card Market, Growth Remains for Issuers Exploring Untapped Segments and Emerging International Trends New York, November 5, 2009 — In a saturated U.S. market for co-branded and affinity credit and debit cards, issuers are exploring growth opportunities in relatively untapped segments and are finding inspiration in emerging global trends, according to Co-Branded and Affinity Credit Cards in the U.S., 3rd Edition, the latest report by leading market research publisher Packaged Facts. “As the U.S. market matures, issuers have been seeking new growth opportunities in Europe, Asia, and other regions to varying degrees of success,” says Don Montuori, publisher of Packaged Facts. “But opportunities still exist in the U.S. market. Growth has arguably slowed, but hasn’t stopped.” Two targeted growth segments are healthcare-related cards and chain supermarkets and drug stores. The millions of consumers enrolled in health plans represent a huge potential new audience for co-branded and affinity cards, one that typifies the kind of frequent-usage, benefits-oriented card holders base issuers are seeking. Supermarket co-branding is widespread in Europe, but has failed to catch on in the U.S. Nevertheless, industry experts cited in the report are confident that the U.S. could learn from the European example and decisively capitalize on the segment within the next five years. Other potential growth areas are the affluent consumer and the under-banked. Many co-brand programs are generally poised to take advantage of affluent consumers’ interest in being engaged in a rewards and loyalty value proposition that is relevant to their lifestyle, though issuers are also researching emerging needs of the affluent in hopes of developing or reshaping programs to surprise, delight and attract different sub-segments. The under-banked and the unbanked remain a greatly underserved group. While issuers are likely to find these consumers less than desirable in the present economy, some experts suggest serving the segment with options such as decoupled debit cards, in which the underlying checking account is separated from the card and the bank assumes some risk. In the short-term, Packaged Facts expects the combination of consumer caution and cutbacks in consumer credit lines and accounts will cause co-branded and affinity card transaction values to dip in 2009, before expanding as the economy recovers. Ultimately, Packaged Facts projects the compound annual growth rate (CAGR) on transaction values between 2009 and 2012 will approach 5%. Co-Branded and Affinity Credit Cards in the U.S., 3rd Edition builds on Packaged Facts’ 2007 report by exploring how the market and players have changed over the past two years; what new products co-branding partners are offering; which new segments offer the most opportunity; how international markets are evolving; how partners are coping with the world’s grim economic realities; and what advice experts have to offer. In addition, the report features the results of Packaged Facts’ 2009 proprietary consumer survey, which explores co-branded and affinity card usage, front-of-wallet, most desired card features, channels and card information sources. About Packaged Facts - Packaged Facts, a division of MarketResearch.com, publishes market intelligence on a wide range of consumer market topics, including consumer goods and retailing, foods and beverages, demographics, pet products and services, and financial products. Packaged Facts also offers a full range of custom research services. | |||||||||
Email a colleague
Printer format
Order by fax