Consumer Credit Card Rewards Value to Reach $67.9 Billion by 2023, as Credit Spend Recovers Post Pandemic
Rewards value to increase by 12.5%
Hampshire, UK – 4th August 2020
: A new study from Juniper Research
has found that global reward values for consumer credit cards will grow from $60.4 billion in 2020 to $67.9 billion in 2023, as consumer credit spend recovers post-COVID. Digital reward schemes encourage brand loyalty by increasing the value proposition of repeat spend.
The research estimated a 13% reduction in credit card spend in 2020 owing to the COVID-19 pandemic, with industries including travel, tourism and hospitality being the most heavily impacted. However, the study argued that digital reward schemes will be instrumental in encouraging spend in the economy during these uncertain times; predicting that credit card spend will return to growth in 2021.
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Issuers and Payment Networks Must Leverage Existing Technology to Drive Loyalty
With the number of credit cards in issue anticipated to exceed 3 billion worldwide by 2023, there is potential for brands to leverage card ownership and foster loyalty using rewards. The research found that credit cards can play a critical role in extending a brand’s ecosystem, such as Apple Card. Issuers and networks must focus on enabling brands to effectively use cards, combined with app-based digital loyalty solutions, to foster improved customer retention. This approach will allow issuers and networks to boost their payment volumes, while also forming valuable brand partnerships.
Research author Susannah Hampton explains: ‘Card loyalty scheme providers should leverage digital platforms already used for payment security to better target and engage consumers via apps and push notifications, thus differentiating themselves from the competition and generating customer advocacy’.
App Loyalty Use to Grow in Major Retail Markets
The number of app coupons redeemed will see growth of 42% between 2020 and 2025 as mobile apps dominate the shopping experience, particularly in markets such as China and the US. The study predicts that businesses will increasingly leverage high smartphone penetration rates in developed regions to exploit the full potential of mobile apps to offer enhanced loyalty programmes for consumers.
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