From July 15th to 16th, consumers around the globe will flock to Amazon to take advantage of the digital retailer’s fifth-ever Prime Day. Promising a “two-day parade of epic deals,” Amazon and its retail partners stand to win big, with transactions expected to reach over $1 billion. Card issuers also win big during Prime Day; last year, the number of Prime Day transactions inside the CO-OP credit card portfolio saw a 41-percent jump compared to the previous year, and we expect the trend to continue this year. (We’ll be sharing the data from this year’s Prime Day in a few weeks – stay tuned!)
Thanks to the rapid rise of e-commerce and the success of online shopping events like Amazon Prime Day and Cyber Monday, the competition for the default card spot on digital transactions has increased significantly. Particularly with Amazon, which leverages its patented “1-Click ordering” feature to allow consumers to bypass the checkout process almost entirely, card issuers, retailers and even Amazon itself are competing to land their cards in the default position. They do this through a combination of targeted campaigns, special rewards and cash-back offers. Target, for example, is offering its closed-loop cardholders an extra 5-percent cash back for online purchases made during the 2-day Prime window. This is on top of the 5-percent they already get.
Credit union card issuers are getting in the game, too. Several of CO-OP’s most progressive credit unions already are offering really exciting perks to Prime Day shoppers. In partnership with our SmartGrowth Consultant Services team, credit union card issuers have launched special rewards campaigns to encourage members to set their credit union card as the default payment, not only in Amazon but other e-commerce retailers, as well.
CO-OP Senior Portfolio Advisor & Card Marketing Strategist Kaitlyn Summitt-Nelsen says the key to default-payment campaigns is creating promotions that are rich and easily achievable.
For instance, one credit union card issuer is partnering with the SmartGrowth team to offer a Spend-and-Get campaign that returns $10 cash back to the cardholder for every $100 spent on Amazon during the Prime Day event. Another is offering 2-percent cash back on all online purchases throughout the month of July. A third credit union is offering to pay one lucky member’s entire Amazon purchase, every day during the month of July.
While it may be too late to kick off a Prime Day campaign this year, there are still things you can do to make the most of the upcoming “parade of epic deals” and also be well-prepared for future shopping events.
- Monitor your transaction data. Take a look how much Prime Day 2019 impacts your credit portfolio. Use that intelligence to strategize for upcoming shopping extravaganzas like back-to-school, Black Friday, Cyber Monday or Prime Day 2020.
- Socialize default payment strategies. Leverage Prime Day headlines to talk with your executives and board members about the importance of investing in data analytics, data-driven campaigns and other digital transformation strategies to help elevate your credit and debit cards in the minds of digital natives and others who are increasingly shopping online. Get them on board now to ensure you have the resources you need to go full-tilt with your digital wallet campaigns in the coming months and years.
- Engage your payments partners. CO-OP, for instance, is happy to connect our credit union processing partners with the SmartGrowth team to begin planning digital shopping promotional campaigns. Each engagement is customized to the credit union’s goals, as well as to the individual portfolio’s market positioning. By looking at the actual behavior of real members, the SmartGrowth team can make highly personalized recommendations to improve performance while also helping members make the healthiest financial decisions.
While Amazon Prime Day is fast approaching, there’s still some behind-the-scenes work you can do to get your credit union well-positioned to reach top-of-digital-wallet status. With smart planning, strategic data intelligence and your members’ best interests at heart, you have everything you need to secure that all-important default position.
We’ll be sharing the results of this year’s Amazon Prime Day – including some helpful strategies and tips to help you prepare for future shopping events – in the coming weeks.
In the meantime, learn how CO-OP SmartGrowth Consultant Services can help you analyze your member data and build customized campaigns to grow your credit portfolio. And discover how to optimize your credit card offering with our latest whitepaper: “How to Succeed in the Credit Card Business: A Blueprint for Credit Unions.”