Over on creditcards.com, there is an interview with Amy Lenander, Capital One’s vice president of rewards program. Very often corporate personnel try to weasel out of saying anything interesting or insightful when they’re speaking on the record (and I don’t blame them, since the wrong comment can easily blow up and become a PR / career disaster), so I was pleasantly surprised to see some good stuff in this interview. For example:
Also, rewards credit cards usually come with extra features that can help you when you travel. The biggest one to pay attention to is foreign-transaction fees. In our Capital One Rewards Barometer survey, more than half of people with rewards cards (56 percent) said they were unaware that card issuers sometimes charge these fees.
Uninformed customers: a bank’s best friend!
Q: What does the recent survey data tell you about what consumers want from credit card rewards programs?
One of the big trends we’re seeing is that consumers are looking for more simplicity and flexibility, both as they earn rewards and as they actually use them. Consumers are realizing that it’s not just about that headline earn rate, but that they should also be paying attention to whether they can actually use their rewards.
In our survey, when we asked people what would make their card better, 52 percent said earning the same amount of rewards on everything they buy, every day.
Capital One is more data-driven than most banks, so I had assumed that their research was telling them a lot of people want simplicity, and it’s good to see that validated here. My own research, wherein I tell normal people about how awesome credit card rewards are and a lot of them aren’t interested, tells me the same thing. The interview continues:
People are busy. They want to live their lives, and they want to get rewarded for that, but they don’t actually want to have to change their behavior just so they can earn rewards on their credit card.
More and more, consumers are becoming aware of the things that sometimes can prevent them from using rewards. Blackout dates, the value of miles or points changing over time or expiring — these are all things that get in the way of customers using their rewards.
We hobbyists have in-depth discussions about how to get around various restrictions. For people who aren’t into this hobby, trying to redeem miles can be bewildering and/or infuriating.
And check this out:
In our Rewards Barometer survey, 11 percent of consumers with rewards cards believe all travel rewards gave the same value, which is not true at all.
Uninformed customers for the win!
Finally, the matter of sign-up bonuses:
Where do you see sign-up bonuses going?
They are still incredibly prevalent in the industry, and I don’t see them going away any time soon. I think they’ll continue to be at pretty high levels.
…Which may or may not have something to do with Cap One recently increasing the bonus on its Venture card.
And one more prediction for the future:
Q: For consumers, will the rewards be better and richer? Will they be scaled back? Or will they be pretty much the same?
I don’t see a trend toward decreasing rewards anytime soon. One of the things happening in the market is that rewards points and miles and cash-back are becoming commodities in the market. As banks and credit card companies seek to differentiate themselves and build loyalty with their customers, they’re going to look to other features in addition to points and miles and cash-back.
If I was forecasting what trends would happen, I would think we’d see more features and benefits being tied to credit cards, in addition to the miles and points.
Q: Such as?
In the travel space, we’ll see more travel-related benefits, such as accident insurance and rental insurance and fraud liability — that sort of thing. But even crediting checked-bag fees — every time the airlines add a new fee, it’s an opportunity for a credit card to credit that for customers as an extra perk.
More perks on the way! Sounds good to me.
Wow, great interview!