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The Challenge in financing loyalty

For many large companies, loyalty is just a side-effect of financing. The store or gas credit card naturally allows the company to collect transaction data and issue benefits.

Coupling loyalty programs with can give companies a blind spot with regard to customers who walk into a store with their own financing. Customers may prefer to accumulate their spending bonuses with their favorite credit card. (I usually charge purchases on my Kroger-issued credit card to direct my benefits toward grocery purchases, freeing up more of my income for spontaneous discretionary spending.)

GE Capital is announcing a new Integrated Multi-Tender Loyalty product that promises to help small retailers incorporate customer data from social marketing platforms. But it is not clear that it can pick up data about customers that don't use the credit card GE Capital wants to provide the store.

Payments Journal: GE Launches Integrated Multi-Tender Loyalty Product, 2014-Jan-17 by Michael Misasi

The timing of this product launch is interesting for a couple of reasons. As a potential positive, the new product could cause investors to ratchet up growth projections for GE’s card business in advance of its pending IPO. Alternatively, consumers’ interest in loyalty programs could remain muted for some time given the recent data breaches at major retailers.

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