More than one-third of credit card holders have enrolled in some type of rewards program for five years or more, but nearly half of that group has never redeemed points for a reward in the respective program, according to a new survey. Nevertheless, the survey, conducted by Maritz Loyalty marketing, found that credit card rewards programs are still a "major factor when consumers are deciding on which card to use for a purchase, with 60% of those interviewed said earning points influences their decision.
The survey, based on 407 interviews, found that 36% of consumers have been enrolled in a credit card rewards program for five years or more, but nearly 50% had never redeemed any of the points.
"Credit card issuers recognize the popularity and value of these programs but are missing the boat when it comes to persuading the customer to redeem their awards,' said Gail Sneed, director of financial services market development for Maritz.
Why does it matter? According to the survey, when a consumer redeems points for some reward, the percentage of those indicating a rewards program influences their decision rises to 75%.
"Credit card issuers need to be more proactive when it comes to communicating with the consumer, especially about reward redemptions," said Sneed. "Customizing credit card rewards programs to fit the customer's lifestyle is one step toward increasing reward redemption."
Maritz said that when consumers were asked what types of rewards they prefer to redeem points for, they responded:
* Cash back (73%).
* Free merchandise (27%).
* Free travel (36%).
* Gift certificates (25%).
* Special members-only offers (12%).
* Special benefits or upgrades (10%).
* Free tickets to events (7%).
The survey found that more women (33%) prefer to redeem rewards for merchandise than men (22%), and that more women (29%) prefer gift certificates than men (21%).
