Bill Hanifin
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Sitting in a Chase branch the other day, my gaze paused on an advertisement for the Chase Sapphire Preferred card. My first thought was “there’s just another rewards card”, thinking the beautiful photography depicting a far-away destination was meant to distract me from a benefits set about as exciting as a walk to the corner store. “Ho hum”, thought I.
Reading down the ad copy, it was obvious the card is positioned as a travel card. It offered 2X points on travel and dining and 1X additional point when travel is booked through Chase’s Ultimate Rewards travel desk. But as I continued to survey the benefits, I saw a card that was created not just to load the frequent traveler with more rewards currency (points) but one that could impact the traveling experience, particularly for international travelers.
It might be the first credit card rewards program that I could qualify as a good example of Contextual Loyalty.
Let me tick down a list of frustrations for US residents traveling outside the country and you’ll see why this is important:
- Foreign transaction fees can add up and create an unpleasant surprise when statements are rendered.
- Panic can set in when cards are lost or other disaster strikes when traveling outside the country.
- Maybe the most problematic for US travelers going abroad is the simple act of completing transactions with a good-old magnetic stripe card.
If you’ve been to a country (just about anywhere these days) that have moved to the EMV standard for card acceptance and processing, then you know the feeling of presenting a card at point-of-sale and watching the cashier return it to you, asking you to insert the card (dip) and enter your PIN to complete the transaction. “But we Americans swipe”, you say. Yes, and “you Americans still don’t know what a kilometer is either”, they say.
The Chase Sapphire Preferred card addresses each of these issues and more, in the process making itself a practical partner for international travel. The card has many benefits which you can see here, among them the Chip and PIN function that facilitates transactions outside the US, while also offering the customary mag stripe method of payment making the card useful anywhere you shop at home.
Contextual Loyalty has several components, not all of which will be evident in market examples like the Chase Sapphire Preferred Card. In this case, Chase thought about the human needs of a specific segments of its credit card base. It identified a gap in the market and filled it with a payment product that not only delivers useful rewards, but also the flexibility of points that can be easily transferred between programs. It also created a card that impacts the experience of international travel and meets those unique needs head on.
The elements of mobile and proximity based reward aren’t present here, but they aren’t required and maybe would not be relevant to the ideal user of this product. On the other hand, we could stretch and say that by creating a card that takes friction out of the international travel experience, Chase has served the intrinsic needs of a particular customer type. Carrying the Sapphire Preferred Card could invoke its own status and level of recognition as folks enjoying this card are recognized as those who must put a lot of stamps in their passports.
It’s good to see there is life in the credit card rewards category, and that smart planning that borrows on the tenets of Contextual Loyalty can have real impact on customer experience.
