MBNA Corp. is extending its reach from affinity and sports programs into the realm of home entertainment.
The No. 2 bank credit card issuer announced an agreement last week to issue a cobranded MasterCard for Thomson Consumer Electronics, owner of the RCA brand. The card offers discounts on RCA products and satellite broadcasting, among other things.
MBNA tipped off its promotion of the RCA MasterCard at the National Collegiate Athletic Association's basketball championship last weekend.
Home entertainment is a booming field, said industry observers who see credit card companies possibly lining up to find partners.
The no-fee RCA MasterCard has the advantage of being first to the market.
In January, Citicorp an-nounced plans to issue a Philips Magnavox MasterCard in the first quarter, but the card is not yet on the market.
"The concept of having a cobranded card with a manufacturer is an interesting one," said Stephen D. Drees, principal, Strategic Marketing Services, Westborough, Mass. "We really haven't seen one since the automobile cards"-the General Motors and Ford products that helped propel the cobranding trend.
An added benefit to MBNA could be access to Thomson's data base of 13 million customers.
The RCA card starts with an introductory interest rate of 5.9% for six months and then rises to prime plus 9.9%, currently 18.4%.
Cardholders earn one RCA Reward point for each dollar of purchases and a 500-point bonus on their first purchase.
A mail-in rebate coupon worth $25 is sent to cardholders after they attain 2,500 points. The coupon is redeemable on the purchase of an RCA electronics product worth at least $100.
Multiple coupons can be redeemed at once, and each coupon is valid for three years. The coupons can also be used to pay for programming provided by U.S. Satellite Broadcasting.
In monthly sweepstakes, cardholders are to have a chance to win an RCA consumer electronics product.
"We want to grow the program and are developing special offers for cardholders that won't be available to the general public," said Jennifer Tharp, manager of RCA credit card sales, Indianapolis.
Michele Turkel, president, Spectrum International Consulting Corp., Scarsdale, N.Y., said the rewards package doesn't seem very generous, considering the need to spend $2,500 just to get a $25 rebate coupon. In addition, she said, the package does not offer cash back, but just a discount on an RCA product, which is less beneficial to consumers.
"I don't know if RCA has the brand image that it used to have," Ms. Turkel said. "Most people think of Japanese products when they think of electronics. It remains to be seen whether the RCA brand can carry some affinity and if the value proposition is enough to get people to accept it."
"RCA is a great brand that has a wide product selection," said Mr. Drees of Strategic Marketing Services. "But the reward program is not terribly competitive. Compared to the dozens of other cards out there, this is one of the smallest rewards."
The cards will be offered at standard and platinum levels. Skipping the gold card tier, which has added great numbers, will help differentiate RCA's offering, said RCA's Ms. Tharp.
"Since platinum is relatively new, I think it has acquired some of the status that gold has lost over time," she added.
"MBNA and RCA have to be very astute in selecting marketing vehicles that are out of the ordinary, like special events in electronics stores," Ms. Turkel said.
