Back to the Future: How Store Credit Cards Can Capture Millennial Loyalty for Life
Customer loyalty is the holy grail for retailers. How to achieve that loyalty (and more importantly, sustain it) can be elusive. However, new research shows that a key driver lies within the unassuming power of traditional store credit cards marketed in untraditional ways, especially with millennial customers, who represent the largest generation in the U.S. and have tremendous spending power.
New research from Citi Retail Services indicates that store cards remain a popular option for U.S. consumers. In fact, 71 percent of consumers — and 84 percent of millennials — would be likely to get a store card if they found the right one. This trend is reflected within growth of spending in the industry overall: From 2016-2018, private-label credit card purchase volume grew at an average annual rate of 3 percent.
While this growth is encouraging, increasing store card adoption is just one step in the path to customer loyalty. When it comes to catering to customers’ evolving needs, it’s essential that retailers remain proactively engaged beyond the initial card sign-up. With millennial consumers in particular, there's enormous opportunity to engage individuals by understanding, and leveraging, today’s trend of being hyperconnected and “always on.”
From the outset, retailers can work with their credit card issuer to enable a two-way communication channel that integrates personalized credit offers within the shopper’s path during checkout. These individual offers can also be accompanied by relevant form filling of the credit application to ease the process and, upon approval, integration of the credit account number and credentials back to the retailer for the completion of purchases on the new card, which we’ve seen result in double-digit increases with regards to immediate use.
It doesn’t end there. Within the first 30 days of an account opening, it’s critical that retailers engage digitally with card members to build a deeper relationship beyond the initial customer interaction. Email is a proven powerful digital engagement tool, and by capturing an email address at the point of sale, retailers can implement effective engagement strategies, including sharing relevant content and offers.
But email isn’t the only way to engage. Eighty-six percent of millennials report using social media, which provides a valuable opportunity for retailers to integrate across digital platforms. Creating customer touchpoints across social platforms allows customers to consume and engage with content on their own terms. Social channels also provide the added potential to foster peer-to-peer sharing so that your customers are in turn amplifying your brand’s content within their networks.
Once retailers establish their preferred digital channels, it’s crucial to personalize those messages to ensure new cardholders’ continuous usage. According to a recent Infogroup survey, as many as 40 percent of millennials say that the most important thing a brand can do is ensure that its messages are personalized to their interests. From credit line increases to loyalty tiers and product upgrades, it’s key that retailers are providing customized offers within the path to purchase. Neglecting to customize communication risks not only annoying millennials but losing them as customers for life.
In 2020, millennial spending is anticipated to reach $1.4 trillion annually, representing 30 percent of total retail sales. With stakes so high, retailers can’t afford to not reach — and engage — this group in a meaningful way.
Leslie McNamara is chief marketing officer and head of workforce development for Citi Retail Services, one of North America’s largest providers of private label and co-brand credit cards for retailers.
Leslie McNamara is Chief Marketing Officer and Head of Workforce Development for Citi Retail Services, one of North America’s largest providers of private label and co-brand credit cards for retailers.
Named to this role in August 2018, Leslie’s role focuses on organically growing the business through Partner, Cobrand and Digital Marketing. Supporting these key growth areas and also reporting to her are Research and Insights, Strategic Communications and Workforce Development. Most recent Leslie served as Head of Business and Market Development for Citi Retail Services, from April 2016 until August 2018. The Business and Market Development group — which Leslie was instrumental in founding — was a new unit Leslie encompassing all market-facing activities for Citi Retail Services. Her responsibilities in that role included Business Development, Research and Insights, Strategic Communications, and Workforce Development. Before assuming this role, she was Citi Retail Services’ Managing Director for Partnership Management, a position she accepted in August 2011. In that role, she provided strategic direction and leadership for Citi’s retail partner private label and co-brand credit card programs. She also headed the company’s field sales and merchant services organizations, which provide day-to-day sales and processing support for the business’ partners’ retail locations.
Leslie is a winner of Citi’s Senior Excellence in Leadership Award and is active in the bank’s women’s leadership initiatives, including keynotes at Citi’s Women Leadership retreats. She serves as a Board Trustee on the Thomas Jefferson University Enterprise Board’s Inclusion, Community Engagement, and Diversity Subcommittee. She is also recognized leader in the payments industry, being a 3x honoree of PaymentSource’s Most Influential Women in Payments.
Leslie joined Citi in 2002, holding positions of increasing responsibility in Partner Management, Marketing and Customer Engagement. Her financial services experience is rooted in consumer lending, business development and marketing, with a concentration in cards and payment products. Her former employers include CoreStates Financial Corp, Mellon Bank, Qwest Interactive, and Proctor & Gamble.