Abstract
Overview
Introduction
Co-branding is an increasingly popular option for both card issuers and
merchants across Europe and the US. This report provides an overview of the
market, examining how the partnerships work, the potential benefits and costs
for both parties and trends. It also provides a detailed review of many
programs in the market and concludes with a discussion on the future of
co-branding.
Scope
- Introduces and discusses different models of co-branding partnerships,
explaining the key motivations for entering into co-branding agreements.
- Examines recent trends in co-branding in Europe and the US.
- Several co-branding arrangements are examined in detail, segmented by the
construct of the loyalty proposition.
- Provides Datamonitor' s Cards and Payments team' s view on the outlook for
the co-branding by region.
Report Highlights
Through a co-branding relationship, customer acquisition costs can be as
little as 15 per cent of what they would be through direct mail or other
means. Issuing banks are also increasingly benefiting from the cross-selling
opportunities that stem from these relationships.
Despite the obvious advantages of entering into a co-branding agreement, there
are many pitfalls that should be avoided by both parties. From the issuer' s
perspective these include the risk of losing revenue from its existing
customers as they switch to the new program. Both parties face reputational
risk in the event of a failed program.
As a result of the success of co-branding partnerships in established areas
such as airlines and hotels, issuers are now looking to different sectors to
gain customers. These opportunities include web based retailers as well as
other retail sectors.
Reasons to Purchase
- Discover what makes for a successful co-branding relationship, and the
risks associated with them.
- Compare the product offerings of the most interesting and innovative
co-branded products on the market.
- Learn Datamonitor' s' Cards and Payments Team' s assessment of future
opportunities in co-branding in Europe and the US.
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