Opportunities Abound for Co-Brand Programs
MasterCard Advisors Says Opportunities Abound for Co-Brand Programs in Asia/Pacific
Niche Card Programs Targeted at More Sophisticated Consumers and Growing Small Business Market Will Proliferate, According to MasterCard Consultants
Auckland, 10 November 2003 Increasingly sophisticated consumers and businesses combined with the maturing credit and debit markets in Asia/Pacific have created an environment ripe for well-positioned, innovative co-brand card programs, according to MasterCard Advisors™, the rapidly expanding professional services business of MasterCard International.
MasterCard Advisors’ recent trend analysis has highlighted the exponential growth in the debit and pre-paid market in the region, with the number of cards and average transaction value doubling over the past two years. Credit cards have showed steady growth since the first quarter of 2001, with the number of credit cards in the region up by 40%. However, the average transaction values on credit cards decreased by 25% in the same period.
MasterCard Advisors presented its analysis and best practice solutions to 180 member financial institutions and partners from across the region at the 2003 MasterCard Global Co-Brand Partner Forum in Kuala Lumpur, Malaysia in mid-October.
“While the payments market has enormous potential in Asia/Pacific, our research has clearly shown that creating successful card programs will lie in effective market segmentation and a strong understanding of consumer needs,” said Jay Singer, vice president MasterCard Hong Kong.
“Consumers are becoming more sophisticated; they are interested in enriching experiences rather than simply owning things. Co-brand programs, with their strong core features, compelling reward platforms, and relevance to consumer lifestyles and spending preferences, serve as the foundation of a vital strategy,” added Singer.
Singer pointed out that in the near future, smaller, nimbler co-brand card programs for specific segments will come to the forefront, rather than large, mass-appeal programs. Highly successful programs for market segments including women and youth already exist and these will continue to proliferate in more specific, profitable niches.
Opportunities also lie in small and medium enterprises, which represent the growth engine of the Asia/Pacific region. Co-brand programs that expand their product offering to meet the needs of small business owners to maximize new account acquisition opportunities and broaden reach, are likely to flourish.
According to Singer, the payments industry in Asia/Pacific faces intense competitive, regulatory, and economic challenges—all of which have created tremendous pressure for business leaders and an opportunity for MasterCard Advisors to achieve successful outcomes.
Delivering End-to-End Solutions
With a highly focused payments expertise in consulting, outsourcing, research and information services, MasterCard Advisors helps clients improve the bottom-line profitability of their payments business.
Services provided by MasterCard Advisors include cardholder services, customer relationship management, information technology, marketing, operations, research, rewards, and risk management. Through these practices, Advisors delivers rigorous analytics and recommends strategic and/or tactical solutions, such as identifying disruptive trends or analyzing portfolio performance, and is able to design and implement useful strategies and tactics to impact bottom line profitability.
“In Australia and New Zealand, and across Asia/Pacific, Advisors deliver significant savings and efficiencies through their involvement and advice to MasterCard's members," said Leigh Clapham, senior vice president and general manager, MasterCard Australasia.
“This announcement represents a significant recognition of the depth of talent and expertise within MasterCard Advisors.”
At the core of MasterCard Advisors is a team of 160 dedicated professionals worldwide whose unique industry knowledge spans every payment system: from cash to emerging electronic payment technologies. To date, this team has completed more than 1,000 client projects, adding millions of dollars to its clients’ bottom lines. A number of success stories to date include:
- A large Australasian retailer and card issuer needed to develop two new co-branded credit cards to service both their prime and underserved customer bases. Of vital importance was the maintenance of in-store spend, as well as the expansion of the services provided to include the ability to shop outside of the retailer’s environment. MasterCard Advisors became a key member of the launch and project team and offered comprehensive consulting support which included: product and value proposition development, customer segmentation, rewards program structure and funding, communication strategy and material development, and operational and systems advice. The results were customer take up rates far exceeding the forecast and profitability requirements of the retailer. In addition, potential process and operational issues were avoided.
- A major international credit card company wanted to increase new card acquisition. MasterCard Advisors developed a creative direct marketing package to bring in new customers to the portfolio. The results in various markets around the world have been increased response rates of over 20% to 50%.
“As the business environment becomes increasingly competitive, companies in the payments business require ‘best-in-class’ solutions and independent research to help them make efficient, sound decisions,” said Singer. “MasterCard Advisors can deliver end-to-end solutions. We have a holistic understanding of our clients’ business and we know how to tactically deliver results. That is our commitment to being our client’s best business partner. We deliver solutions that drive success.”
About Co-Brand Card Programs
Co-branding is a partnership that brings together three parties: a global payments solutions provider such as MasterCard, an issuing financial institution and a partner. The three parties work in close collaboration to create a card program that is marketed to the partner’s customer base. Co-brand card programs offer the opportunity to reward existing customers with an expanded-utility payments vehicle that typically carries the partner’s logo/brand identity and offers distinctive cardholder incentives. Examples of successful co-brand card programs in Asia/Pacific include the MTV Card (Singapore), Virgin MasterCard credit card (Australia), Kartu Belanja Carrefour (Indonesia), Citibank Skypass MasterCard (Korea) and Core Pacific City Mall MasterCard (Taiwan).
About MasterCard Advisors
MasterCard Advisors is a global professional services group within MasterCard International Incorporated offering consulting, outsourcing, and information services. Through a worldwide network of payments industry professionals, MasterCard Advisors delivers highly focused expertise and customized solutions to help increase share and maximize profitability for its clients. MasterCard Advisors provides access to best-in-class payments expertise across cardholder services, customer relationship management, information technology, marketing, operations, research, rewards programs and risk management.
About MasterCard International
MasterCard International is a leading global payments solutions company that provides a broad variety of innovative services in support of its global members’ credit, deposit access, electronic cash, business-to-business and related payment programs. MasterCard International manages a family of well-known, widely accepted payment cards brands including MasterCard, Maestro and Cirrus and serves financial institutions, consumers and businesses in over 210 countries and territories. The MasterCard award-winning Priceless advertising campaign is now seen in 98 countries and in 46 languages, giving the MasterCard brand a truly global reach and scope. For more information go to www.mastercardinternational.com.