I hate rebates

I meant to post this note in response to this Colloquy article on the debate on rebates back in May. However, 6 months later (now in November), I feel just as strongly as I did then.

I HATE REBATES. 

Not as a consumer, of course, but as a marketer and loyalty practitioner. Rebates encourage cherry-pickers. Rebates are for the 'penny-wise'. Rebates cannot encourage long-term brand affinity, patronage, or higher-margin product cross-sell/up-sell. Rebates kill your product CVP, your profits, your image, and eventually your business.

It's true.

Yes, I agree that rebates may work for certain category-goods, it certainly does not work in the long-term for payment cards. Then again, most banks fail to see the 'longer-term big picture'. So, we are back to square one.

And I categorically agree with everything the article says and advocates. Read it, please.

Virtual Currency may no longer be "virtual" anymore

Just a moment ago, Finextra tweeted an piece of Amex-related news: American Express has filed a patent for a system and method for using loyalty rewards as a currency.Any loyalty practitioner will find this statement odd. Loyalty rewards mostly operate on the concept of a 'rewards currency'. So, what is so different about this? Further reading reveals that 'currency' in question, is one that is 'virtual' in nature. By 'virtual', it refers to currency that exists in the 'virtual' or a.k.a. internet/online world.

For hardcore online gamers or even Facebook amateur players, the 'virtual currency' is 'virtual money' used in the purchase of all things, well, virtual; like a potion here and there, or a zombie to grow your garden. As with money in the real-world, you have to 'work' to 'earn it'.

Amex put in $30 million in September for a 4-year-old company Sometrics that helps gaming companies set up the infrastructure to enable virtual-currency. With this, they may have made the most far-sighed investment in new business yet.

As the social-cultural sphere is increasing entrenched within the 'virtual', so is the economy. The world painted in the movie series Matrix may be a teeny bit far-fetched, but who is to say that the clothes, food supplies, armour and magic potions you buy in the cyber world are less important or valuable that the tangible real ones in the world?

Food for thought.

Credit Card or Discount Card?

It's the Great Singapore Sale again, and there has never been a better time to enjoy credit card promotions. Every bank seems determined to out-do each other in bigger discounts and better deals for cardholders in their tie-ups with merchants.

Card marketing has never seen tougher times of competition. Aside from the stiff competition in funding and delivering all kinds of expensive-to-run promotions (consumers have even come up with a ever-so-helpful listing of all the great credit card deals this year), customer loyalty seems to be a thing of the past as more and

How many credit cards do you carry with you? 4? 5? 10?

It is a sad, sad state of things to see a credit card reduced to a retail discount card.

Accessing your rewards on a phone

In March 2011, OCBC Cards managed to complete the most large-scale loyalty platform implementation in recent memory. I was glad to be part of the project team to have made it happen.

In the time I have spent in customer loyalty, the primary focus had been on a few key elements, namely, the value of the reward currency, the relevance of the rewards earned, and the rate at which they are earned.

Back then, no one had anticipated the proliferation of social networking and the widespread use of the smart phone as a banking medium.

As these developments unfold in ever-increasing frequency and speed, it dawned on me, that a customer's view on rewards would also have altered by these changes. This is an epiphany that led me to think that the next battle ground in rewards is not in the 'earn', but the 'burn'.

While the rest of the card banking community tries to out-do each other in multiplier points earn, perhaps enabling a quick and easy way for customers to access their rewards currency anytime, anywhere, is the next big thing to disrupt the market?

I hope anyone who reads this will take a moment to visit the OCBC rewards mobile website: mobile.ocbc.com.

Although this is a mobile web-based service at the moment, I hope that in time, our recently released Android mobile banking app will incorporate rewards as a key functionality.

Meanwhile, have a look a a video on the much-talked about OCBC Android mobile banking app.

ZDNet interview of mobile banking product manager.