Rewards Play Major Role In Credit Card Customer Satisfaction
The inaugural J.D. Power Credit Card Satisfaction Study found that when it comes to choosing a credit card, it’s all about rewards. But just offering rewards isn’t enough: cardholders have to understand how to redeem them, as well.
Jim Miller, Vice President of Banking and Credit Card Practice at J.D. Power, said there’s more to building a satisfying rewards program than points, miles, or cash back offered. “Understanding how to redeem rewards—and having redeemed rewards recently—has a significant effect on satisfaction and loyalty levels.” He said credit card issuers need to educate their customers on how redemption works, and design their programs in a way that encourages them to redeem their rewards frequently.
Eighty-seven percent of credit card holders who participated in the J.D. Power study are enrolled in a rewards program; this includes the 48 percent of respondents who said they’d switched their primary card during the past year in order to have access to a more valuable rewards program.
Knowing how to redeem rewards is key
The study showed that 64 percent of respondents say they completely understand how to redeem rewards with their credit card program. Among this 64 percent, credit card satisfaction is 87 points higher than it is for folks who said they don’t fully understand how their rewards program works.
Satisfaction with their credit card program was strongly linked to how often cardholders redeemed their rewards, whether that was in the form of cash back, free flights, upgraded hotel stays, or other types of rewards. That said, cash back and airline tickets were the most popular rewards among those surveyed.
Those survey respondents who had redeemed rewards within the past month were the most satisfied with their credit card issuer, compared with those who had redeemed rewards three months ago, more than a year ago, or not at all.
Not all credit cards offer rewards
While rewards credit cards are popular, and customers enjoy perks like cash back, hotel points, and airline miles, some credit cards don’t offer rewards programs—and that’s okay.
People with limited or no credit, for example, may benefit from a secured credit card. This type of card does not typically offer rewards, but is helpful for those who are looking to build or repair their credit. They are increasingly popular among a wide variety of customers, and provide a necessary service as well as a stepping-stone to better credit—and approval for a rewards credit card.
Latest Credit Card Rewards News
This week, BlockFi, a crypto lending company, announced the upcoming release of its rather unusual credit card – the Bitcoin Rewards Credit Card. The card will become the first-ever credit card with cryptocurrency rewards. Until now, credit cards’ rewards programs could offer cashback, points, or miles. But earning credit card rewards in the form of […]
2020 can be safely called the weirdest year of the last decade. The pandemic has affected every corner of the world. And we can only guess what surprises await us in the last month of the year. However, something still remains the same (or almost the same) – Black Friday. It is not hard to […]
This week marked the launch of another credit card. This time we are talking about the new cash back credit card from Venmo, a mobile payment service owned by PayPal. The card got a very simple name – Venmo Credit Card. The company announced its plans to roll out its first credit card a year […]
Starting July 1, holders of Chase Freedom® credit cards can earn 5% cash back for purchases in special Q3 2020 bonus categories. The new quarter favors eligible Chase customers with enhanced rewards on Whole Foods Market and Amazon.com purchases. Chase states that all Whole Foods Market purchases made before October 1 will qualify for 5% […]
The coronavirus pandemic has affected everyone. Many people were to remain without earnings. To support people, many banks have developed relief programs and offer customers, for example, defer payments, temporarily reduce interest, increase credit limits, etc. American Express don’t stand aside either. But in addition to the Financial Hardship Program, the issuer also decided to […]
