This year’s market review finds that merchant-funded reward programs have not delivered the results many financial institutions had expected. The last two years have indeed been a learning experience for all parties involved in this emerging industry.
Mercator Advisory Group’s most recent research report, Merchant-Funded Rewards: Issuers Regroup After Disappointment, reviews legacy models and emerging technology solutions for card-linked merchant-funded reward programs, diagnoses the causes of the industry’s underwhelming performance, and explains how financial institutions can still get value from these programs.
“Payments and commerce are becoming more intertwined every day,” comments Michael Misasi, senior analyst at Mercator Advisory Group and author of the report. “Card-linked offer programs combine elements of payments, digital advertising, rewards, and loyalty. Cross-industry collaboration will be crucial for financial institutions and payment services providers to realize the opportunity inherent in this emerging business.”
- A comparison of several issuers’ merchant-funded reward programs
- A review of the card-linked offer vendor landscape
- An analysis of how new players might upset the transaction-driven offer model
- Estimated and projected U.S. consumer credit volume driven by card-linked offers