Lately, it appears that several brands are considering introducing their own credit cards, in an attempt to gain new clients and retain more of their current ones for long periods.
Drugstore chain Wallgreens is the latest to join the trend, as they just announced their plans to unveil a lineup of cards later in 2021, as a result of a partnership with Mastercard and Synchrony Bank, as part of their plans to expand its core business.
How does this move help retailers?
Of course, this entire trend raised some question marks, as creating a credit card seems, at a first look, an odd choice for any brand that’s well known for its brick-and-mortar locations. However, in Walgreens’ case – and in many others’ – this is, in fact, not that strange.
More and more brands, including retailers, are now trying to align with customer loyalty programs and, with the whole digitalization process acceleration, this trend will surely continue.
To wrap it up, the argument in favor of such credit cards is simple: it’s an attempt to appeal to the modern customer in a world that’s still highly affected by the COVID-19 pandemic. Finding new ways of reaching customers are mandatory nowadays. And this is exactly where loyalty and credit cards come in.
Should you apply for one?
The biggest problem – and if we start like this, we bet that you already know the answer – is that these credit cards lack flexibility in most cases, in terms of both earning and redeeming. Sure, there are cards offering some really solid earning opportunities, across a wide range of categories, while the redemption process is also very easy, but, generally speaking, most retailer cards make it a bit difficult to earn and spend those rewards.
And all these somehow hinders the ability to compete with other cards! So, are they worth it? Maybe in just a few, very rare cases.
To wrap it up, it’s still early to tell if retailers’ credit cards are here to stay. But, at least for the moment, we won’t be surprised to see more big names joining this bandwagon, as the brand loyalty game keeps evolving and retailers will be looking forward to competing against cards coming from top banks.