MasterCard Will Run Rewards Programs for Banks
MasterCard International is readying a loyalty marketing service for banks.
MasterCard Rewards Services will develop and manage separate loyalty programs tailored to each bank’s product portfolio and its customer base. The service will launch in early 2007, leveraging MasterCard’s consumer spending data, its loyalty-marketing experience, and technology that enables the company to handle point scoring, tracking and fulfillment across multiple product lines for multiple banks.
Each bank can set the level of customization for its own program, letting consumers accrue points across the specific services it wants to promote. Rewards can be based on deposit or investment balances; transactions, such as card purchases, online bill payment and direct deposit; the number of the bank’s products that a customer uses; or one-time transactions, such as a mortgage application.
Possible rewards run the gamut from cash rebates and travel or gift certificates to matching contributions and experiential rewards. MasterCard can set reward programs up to let members pool points from personal and small-business products, so they can redeem points faster (and, ideally, use more of the bank’s services).
“By offering relationship-based rewards, MasterCard helps our [member banks] develop programs that are more relevant to the varied interests and preferences of their customers, and expand upon their share of financial services,” said Patricia Preston, MasterCard International’s group head of debit product management for the Americas, in a statement.
MasterCard is working with banks now to roll out programs in early 2007; lead times will vary, depending on each bank’s program, Shipley said. Banks pay MasterCard a fee, based on the size, complexity and service level for their program.
“We work consultatively to clearly understand goals, market position and expectations of our [bank] partners in order to suggest solutions that will meet their needs and achieve their goals,” Shipley told PROMO.
Earlier this month, MasterCard began tying its debit cards to Upromise, a coalition loyalty program that lets consumer members accrue rebates in a college-savings account (PROMO P&I, Nov. 1, 2006).
Four banks issue the cards tied to Upromise: BancorpSouth, BankAtlantic, BECU and Provident Bank. MasterCard and Upromise will provide the four financial institutions with marketing collateral for one year, then decide whether to offer the program to more banks.
