The Washington Post recently wrote an article featuring a partnership between Bank of America and tech firm Cardlytics that brings forward a game changing idea. The new program will use past debit and credit card transaction data to offer B of A customers targeted discounts at relevant retailers. We have highlighted in the past that B of A needed to improve its approach to debit cards; this is a great innovation and a big step in the right direction.
Most retailers have a loyalty program or something similar to strengthen and grow the relationship with existing customers. Many offer cut-rate promotions made available to the general public, with the “deal of the day” being a recent extreme example. With these promotions, retailers offer huge discounts to anyone who signs up, yet a large portion of redeemers are consumers that will take advantage of the offer and never shop again.
By leveraging past purchasing information, B of A is providing something much more compelling. For example, an offer could be targeted just to consumers currently shopping with a competitor. By targeting those with a willingness to spend in the category, this is more powerful for merchants and will presumably make the offers more relevant for consumers.
There are several important factors to make this a success. (more…)