January 31, 2007

A Move Towards Simpler Rewards

Many rewards cards offer generous redemption options and/or cash rebates, but they are often fraught with conditions. Depending on what type of dedicated card you have, you may get the maximum rebates only on specific purchases, such as gas or dining or office supplies. These offers work fine for some – especially if you can find a specialty card that suits your particular needs- but for others, a more general-use program is in order!

Card companies have, as ever, tapped the pulse of dissatisfaction coming from consumers, and are now clamoring to present the simplest rewards programs around. In recent years, a similar wave of consumer ambivalence towards the limitations of rewards offered led to a drastic reconstruction of rewards flexibility by most issuers. Progress seems to be the name of the game once again, as card companies tout simple cash back rewards of a fixed percentage on all purchases, all the time. Granted, these rebates tend to hover in the 1%-2% range, as opposed to the 3%-5% offered on specific purchases on dedicated cards, but these new programs seem to be a legitimate attempt to placate Joe Consumer. Rewards programs share many things in common, and one of them is card companies’ constant attempts to be unique! The credit business is competitive, and every cardholder counts – hence, the move to make the consumers happy.

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