Happy charging!

There’s never been a better or easier time to own a credit card. Heightened market competition has resulted in aggressive campaigns designed to make it more convenient for customers to apply for one. If you’re lucky, you may even get a pre-approved card in the mail.

But after giving you a credit card, the next challenge for the issuer company is to keep you happy and loyal and to encourage usage.

For housewife, Myrna Lopez, loyalty programs are one of the perks that come with managing her household’s budget. "I have to admit I would give my business to a company that rewards me for my loyalty. Even my friends do the same."

The need to be rewarded for loyalty is not confined to housewives. Male members of the family are equally susceptible.

Since receiving the latest rewards catalog from his credit card company, Ernesto Lim has been channeling all his spending to that card and has urged his wife, who holds a supplementary card, to do the same. "There are at least five items I want to redeem by the end of the year and I have nine more months to go," he said.

Model program

Citibank started it all in the credit card industry when it launched its rewards program in 1996. Introduced to spur usage for a growing cardholder base, the strong reception towards Citibank Rewards has made it a permanent feature of Citibank credit cards and a model for similar loyalty programs in the industry.

"Because it has been well thought out and has become so popular, the program’s features have remained basically unchanged since its launch," said Citibank Rewards program manager Jay Bengzon.

A Citibank credit cardholder earns one point for every P30 spent on his card. Accumulated points may be used to redeem premium items, annual fee waivers, and frequent flyer miles features in regularly updated catalogues.

"We choose items based on the relevance of our cardholder base," said Citibank assistant vice-president Liel Gonzalez. "The value of the item must be meaningful to our cardholders. We want to get good discounts on the items we feature so we pass on these discounts to our cardholders."

Unusual features

A number of features sets Citibank Rewards apart from those offered by other credit card companies.

For one, the points earned never expire. A cardholder may opt to collect points as long as he wants to allow him to redeem higher value items. Points earned in 1996 are still valid and may be used to redeem items in the 2001-2002 catalogue, which can be viewed in full at the Citibank web site (222.citibank.com.ph).

For another, Citibank offers a fast-track option for all of the Rewards items. A cardholder may redeem an item with half the required points plus a little cash. The cash payment is charged to his credit and earns him new points, making this a preferred option among cardholders.

Finally, Citibank Rewards offers free delivery of the tax-free redeemed products, including high-value items, to the cardholder’s home or office.

"We’re trying to find ways to make the items more affordable. We are also selecting items that reflect the hottest trends in the market," said Gonzalez.

Heightened competition has gotten the creative juices of marketers flowing, making them take all those extra steps to keep the customer, who is being given more and more choices, happy.