Constructing store payment incentives with an eye for fairness

Recently, an article appeared on the Wall Street Journal warning credit card users against certain practices that seem too good to be true or are otherwise unfair to them. One of these involves a practice stores can take part in to encourage customers to use their card payment processors: using cards created specifically for the store, with certain incentives attached.

Though this may sound like a relatively clear-cut means through which to engage customers, the article warns consumers against it on the grounds that such cards can inadvertently lead to debt if users still maintain a high balance after a certain promotional period. 

This article might seem like bad news for merchants, especially those looking to create these kinds of cards to draw people in. But it can actually be a means of highlighting what works in these kinds of strategies, and what doesn't.

More transparency could perhaps allow for fewer surprises on the purchaser's end and lead to more trust of the business in question. And, it could ensure that the promotional nature of such an offer isn't lost once the discounted time wears off. This doesn't mean that chains can't use this kind of card as a tactic at all, only that it should be done with a long-term plan for keeping customers in mind.

It can be difficult to determine exactly which kinds of strategies are most worth keeping and which are all hype. As customers become more savvy, merchants too can adjust the features of what they offer to best please those whose business they're interested in, all while keeping a focus on processing credit card payment

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