Artificial intelligence has been part of credit cards for decades, particularly with tools that support underwriting and fraud management, but the big enchilada has always been to predict and influence buying behavior. That is getting better but it still has a ways to go.
- In the case of Maritz, HSBC sent marketing emails to 75,000 customers using Maritz’s algorithms. A portion of customers received an AI-recommended particular category of credit card reward – travel, merchandise, gift cards or cash back – while the rest received standard marketing emails.
- About 70 per cent of the targeted customers who ended up redeeming their points chose the recommendation generated by the computer, Mr Wolfersberger said.
Is there something here or is it like the studies where monkeys beat Wall Street investors? In the monkey study, which comes out of Princeton University, blindfolded monkeys throwing darts at newspapers either equaled or bettered educated investors in their stock picks.
- Other credit card companies have been using big data, or AI to predict where a customer will spend their money or market items to customers for a few years. American Express has a programme known as Amex Offers, which could be a coupon or additional reward points when a customer spends money at a particular merchant.
- Which American Express customer gets targeted for a particular offer depends on their spending behaviour, a company spokeswoman said.
No doubt, AI should and will serve the payment space even deeper than it does today. There is much to harvest at every touch point. But while experimentation is promising, what will the chimps think?
Overview by Brian Riley, Director, Credit Advisory Service at Mercator Advisory Group
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