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Phoenix Synergistics: Reward Programs for Financial Services

Jan 2019 | Credit, Debit, and Relationship Rewards | Revenue and Relationship Building | Mobile Applications
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Survey Topics

  • General Reward Orientation
  • Credit Cards
  • Premium Credit Cards
  • Relationship Reward Programs
  • Debit Cards
  • Marketing Issues
  • Respondent Profile

Methodology

National Survey – The survey will include 1,500 online interviews with consumers age 18 or older.

Objectives

  • Examine the current reward orientation among consumer households. Measure participation in shopping, dining, and travel-related programs. Determine how this impacts shopping behavior.
  • Profile consumers’ usage of reward credit cards. Assess how this impacts card activity – particularly usage of multiple reward cards. Examine the role of premium or prestige cards in this market. Assess annual fee potential.
  • Explore the potential for reviving debit card rewards. Measure current participation in these programs and assess the appeal they have. Measure reaction to combined debit and credit card reward programs.
  • Assess experience with and potential for relationship-based reward programs tied to checking or banking activity. Gauge the effectiveness of these programs in terms of increased customer activity, new account openings, and relationship retention. Examine experience with preferred customer programs.
  • Examine the attitudinal and behavioral factors related to the design and positioning of reward programs. Measure the relative value of cash back, reward points, travel awards, and pricing discounts. Determine the perceived advantages and drawbacks of reward programs that should be addressed in positioning and communication strategies.
  • Measure the potential for innovative reward programs and delivery methods – including customized rewards, experiential rewards, and targeted messages or alerts based on shopping preferences. Assess receptivity to mobile apps for managing and optimizing reward programs.
  • Identify market segments for which specific reward programs have the most appeal. Determine if there are customer groups that represent wider potential revenue opportunities related to enhanced reward programs.

Key Dates

  • October 26, 2018 – Final acceptance of client comments on the questionnaire.
  • October 26, 2018 – Charter fee date.
  • December 2018 – Initial results available.
  • January 2019 – Project Report available.

Contact Mark Sutin at mark.sutin@phoenixmi.com or 609-261-6332 to learn more about individual pricing and our discounted subscription offerings.

Rewards have become an expectation among consumers, particularly when it comes to credit card products.  The types of rewards that are popular have fluctuated over the years, being influenced by economic factors and changing consumer opinions.  Are certain types of rewards now more popular to certain age and household income segments?

Rewards can be associated with credit cards, debit cards, checking accounts, preferred customer programs and other relationship factors.  Many are questioning whether debit card reward programs are still viable in today’s marketplace.  There are reward programs tied to balances, while others depend on frequency or volume of product or channel usage.  In addition, rewards may be customized or even combined based on usage of multiple financial accounts and services – such as usage of credit and debit cards.  Recent research by Phoenix Synergistics has found that mobile apps related to rewards are highly desired by consumers.  But what types of mobile app features are most wanted?

In developing reward programs, providers need to identify their objectives – fee revenue, account acquisition, or customer loyalty and retention.  This study examines consumer usage of and reaction to reward programs for financial services such as credit cards and debit cards, as well as relationship reward programs. This study from Phoenix Synergistics will help providers gain an understanding of consumer preferences, attitudes and expectations, as well as behavior patterns, which will assist providers in shaping their reward programs.

Key Finding from a Recent Report:

In the 2016 Phoenix Synergistics survey, Revitalizing Reward Programs, findings revealed that most participants in relationship reward programs and a majority of non-participants said they would be less likely to switch FIs as a result of a relationship reward program.

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