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The Sticky Card: Credit Unions Can Influence Which Cards Their Members Choose To Make Purchases


Most consumers have at least three credit cards from various sources. In addition, many people also carry one or two debits cards and a mix of gift and loyalty cards. A recent Gallup poll showed most Americans foresee the death of cash in their lifetimes, meaning all purchases will be made with credit and debit cards, as well as other forms of electronic payment. For the big issuers, this is rosy news, but for smaller institutions like credit unions, it can be stormy.

Credit Union Card Services

Millennials especially have warmed up to credit cards, with more than 83% of those aged 25 to 34 using them. Subsequently, card transactions continue to grow at a healthy clip, with much of that growth being traced to recurring payments to businesses like Netflix, iTunes, Amazon, Uber, membership fees, political contributions, and online services like Blue Apron, Stitch Fix, and Photoshop.

This is great news for financial institutions that saw fee income dry up during the financial crisis. During the recovery, interchange fees became a reliable and important revenue source for institutions, including credit unions. It might be tempting to think that the upward trend in credit card use will continue to spread the wealth across the board. But, just as assets have been consolidating at the largest financial institutions, it’s worth considering that those same issuers are poised to receive a greater share of the revenue pie.

Top of Wallet

Top of wallet has long been the mantra credit card issuers lived by, looking for ways to ensure their card was the one customers consistently pulled out of their wallets at the time of purchase. As online payments and digital wallets gain popularity, it’s a concept that is becoming obsolete. Top of app is now the call to arms and the bigger issuers have taken an early lead in the digital battle.

It’s easy to find examples of where they’ve been successful. Costco’s switch from Amex to a Visa card (which also doubles as the new membership card), means customers are more likely to use that card when paying for purchases in store or online. And Citi offered its customers credits when they entered its cards at the iTunes store. Credit unions must find a way to stay in the race.

Encourage Sticky Behavior

One effective strategy is to encourage customers to use their cards in such a way that, once they see the perks that come with loyalty, they’ll be more likely to stay with your card. Types of “sticky” behavior include automatic bill payments, online purchase platforms, and mobile apps and wallets.

  • Autopay is a time-tested strategy for improving card stickiness. Today your credit union card services must include some type of rewards program if you want it to be the one your customers choose.
  • Online payments for services like Amazon, iTunes, and PayPal should be encouraged, with a reminder of the rewards users will earn via their online purchases.
  • Mobile app and wallet use is increasing at a rapid pace. The platforms often allow for multiple designated cards, with one card set as the default payment method. Drive sticky payment here by encouraging customers to make your card that default payment method. While earning rewards is an effective motivator, you also want to discourage switching to another card by developing ongoing incentive offers that are regularly sent to your cardholders.

Digital technology will continue to evolve, and there will be a coinciding increase in the number of opportunities that encourage card stickiness. It’s imperative that your credit union card services stay ahead of the curve, educating your cardholders as to why your card should be their preferred choice.

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