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Co-Branded Credit Cards in the U.S., 8th Edition

  • ID: 5394052
  • Report
  • July 2021
  • Region: United States
  • 135 Pages
  • Packaged Facts

FEATURED COMPANIES

  • Amazon
  • American Express
  • Citibank
  • Delta Air Lines
  • Jetblue Airways
  • Marriott International
This report covers the U.S. market for co-branded credit cards, including retailer and travel cards, with an emphasis on credit card program features and benefits, marketing and loyalty program strategies, and growth trends.

The report analyzes the impact of COVID-19 on the retail and travel sectors and on the co-branded credit card market, the going-forward strategies of top co-branded card issuers, key retailer programs and initiatives, and consumer use of co-branded cards.

More specifically, the report provides analysis and profiles of:

  • Credit card receivables and purchase volume, including digital and contactless trends
  • Purchase volume for the top ten co-branded card programs
  • Retail, travel, and hospitality industry dynamics in the wake of COVID-19
  • Reward categories most popular with consumers
  • Leading co-branded card issuers: American Express, Capitol One, Chase, Citibank, and Synchrony Financial
  • Leading airline co-branded card programs: American Airlines, Delta Air Lines, JetBlue Airways, Southwest Airlines, United Airlines
  • Leading hotel co-branded card programs: Marriott International, Hilton Worldwide, InterContinental Hotels Group
  • Leading retail/e-tail store co-branded card programs: Amazon/Prime, Costco, Target
  • Co-branded card usage/monthly usage and cardholder demographics in comparison to major credit cards and to store cards overall, and also broken out by type (department store, warehouse club, airline/hotel, and Amazon/Prime).
Note: Product cover images may vary from those shown

FEATURED COMPANIES

  • Amazon
  • American Express
  • Citibank
  • Delta Air Lines
  • Jetblue Airways
  • Marriott International

CHAPTER 1: EXECUTIVE SUMMARY


  • Scope of Report
  • Report Methodology

MARKET OVERVIEW


  • Purchase Volume Trends for the Major Networks
  • Table 1-1 Purchase Volume for Mastercard, Visa and American Express, Quarterly, Q1 2020 - Q1 2021 ($billions)
  • Long-Term Payment Trends Accelerate
  • Credit Card Usage
  • Table 1-2 Share of U.S. Adults with Rewards Credit Cards: Overall and by Type of Reward, 2020 (percent)
  • Consumer Pay Down of Debt
  • Table 1-3 Revolving Credit - Change, Flow and Outstanding, 2016-Q1 2021
  • Credit Card Rewards Respond to Lower Transaction Volumes
  • Business Sectors Are at Different Stages of Recovery
  • Travel and Hospitality Industries Are Slower to Recover
  • Largest Co-branded Credit Card Programs
  • Table 1-4 Top Ten Co-branded Credit Card Programs by Purchase Volume, 2018-2020 ($billions)
  • Consumer Credit

THE ISSUERS


  • Industry Context
  • Table 1-5 Credit Card Receivables and Purchase Volume, Leading Issuers, Q4 2020 vs. Q4 2019 ($billions)

AIRLINE PARTNERSHIPS


  • Industry Context
  • Airline Loyalty Programs
  • American Airlines' Program Valuation
  • Delta’s Program Valuation
  • United Airlines’ Program Valuation

HOTEL PARTNERSHIPS


  • Industry Context
  • Co-branded Relationships
  • Hilton Revenues
  • InterContinental Hotels Group (IHG) Rewards Club
  • Marriott Bonvoy Loyalty Program

RETAILER PARTNERSHIPS


  • Store Cards and Co-branded Cards
  • Amazon Prime Credit Cards
  • Costco Anywhere Visa
  • Target RedCard

THE CONSUMER


  • 30% Have Co-Branded Cards
  • Co-branded Card Patterns by Type of Affiliation
  • Table 1-6 Co-branded Credit Card Usage Rates by Selected Types: Have in Own Name vs. Used in Last 30 Days, 2021 (percent of adults)

CHAPTER 2: MARKET OVERVIEW


  • Scope of Report
  • Report Methodology
  • Purchase Volume Trends for the Major Networks
  • Table 2-1 Purchase Volume for Mastercard, Visa and American Express, Quarterly, Q1 2020 - Q1 2021 ($billions)
  • Table 2-2 Largest Credit Card Issuers by Receivables and Purchase Volume, 2020 ($billions)
  • Long-Term Payment Trends Accelerate
  • Credit Card Usage Trends
  • Table 2-3 Share of U.S. Adults with Rewards Credit Cards: Overall and by Type of Reward, 2020 (percent)
  • Consumer Pay Down of Debt
  • Table 2-4 Revolving Credit - Change, Flow and Outstanding, 2016-Q1 2021
  • Debit Card Use Increased During the Pandemic
  • Credit Card Rewards Respond to Lower Transaction Volumes
  • Issuer Strategies Combatting Credit Card Churn
  • Digital Commerce
  • Contactless Cards
  • Business Sectors Are at Different Stages of Recovery
  • Figure 2-1 U.S Monthly Retail and Food Services Total Sales, 2020 (seasonally adjusted) ($millions)
  • Travel and Hospitality Industries Are Slower to Recover
  • Table 2-5 Number of Passengers Passing Through TSA Checkpoints on June 26th, 2019-2021
  • Largest Co-branded Credit Card Programs
  • Table 2-6 Top Ten Co-branded Credit Card Programs by Purchase Volume, 2018-2020 ($billions)
  • Consumer Credit
  • Table 2-7 Pandemic Unemployment Hit Leisure and Hospitality Industries Hardest

CHAPTER 3: THE ISSUERS

INDUSTRY CONTEXT


  • COVID-19 Pandemic Effects
  • Table 3-1 Credit Card Receivables and Purchase Volume, Leading Issuers, Q4 2020 vs. Q4 2019 ($billions)
  • Note on Other Banks

AMERICAN EXPRESS


  • Overview
  • Table 3-2 American Express, Interest and Non-interest Revenue, Q1 2020- Q1 2021 ($billions)
  • Achieving Acceptance Parity with Visa and Mastercard
  • Small Business Saturday and Lower Merchant Discounts

CAPITAL ONE


  • Overview
  • Table 3-3 Co-branded Credit Card Purchase Volume and Receivables, Capital One, 2018-2020 ($billions)
  • Key Program Partner: Walmart

JPMORGAN CHASE


  • Overview
  • Table 3-4 JP Morgan Chase: Co-branded Credit Card Purchase Value and Loan Receivables, 2018-2020 ($billions)
  • Snapshot of 2020 Consumer Lending
  • Table 3-5 JPMorgan Chase Income Statement, 2020 ($billions)
  • Table 3-6 JPMorgan Chase Credit Card Sales Volume and New Accounts, 2018- 2020
  • Table 3-7 Components of JPMorgan Chase Credit Card Income, 2018- 2020 ($billions)

CITIBANK


  • Overview
  • Table 3-8 Citi Branded Card Services Co-branded Credit Card Purchase Value and Loan Receivables, 2018-2020 ($billions)

SYNCHRONY FINANCIAL


  • Overview
  • Table 3-9 Key Synchrony Financial and Performance Metrics, 2019 and 2020 (in dollars)
  • Table 3-10 Synchrony Financial Co-branded Credit Card Purchase Value and Loan Receivables, 2018-2020 (in billions of dollars)

CHAPTER 4: AIRLINE PARTNERSHIPS

INDUSTRY CONTEXT


  • Largest U.S. Airlines
  • Table 4-1 Largest U.S. Airlines by Revenue, 2018-2020
  • Airline Net Income Plunged
  • Figure 4-1 Systemwide U.S. Scheduled Service Passenger Airlines Annual Net Income ($billions)
  • Revenue Dropped $76 Billion at Five Largest U.S. Airlines in 2020
  • Figure 4-2 Decline of Major U.S. Airline Share Price in 2020
  • Global Aviation Industry Lost $370 Billion in 2020
  • Figure 4-3 Global Air Passenger Traffic Falls by 60% in 2020
  • Airline Loyalty Programs
  • After Cash, Travel Rewards Are the Most Popular Credit Card Reward
  • The Power of Co-branded Credit Cards to Drive Behavior
  • Table 4-2 Average Miles Earned by Airline Credit Card Adopters, 2016-2018
  • Profits from a “Free” Award Ticket
  • Table 4-3 Issuer Profits from Travel Award Ticket
  • How the Airlines Steer Redemption of Miles
  • U.S. Airlines Are Mileage Marketing Companies with Loyalty Flights
  • Table 4-4 Market Value of Largest U.S. Airline Frequent Flyer Programs ($billions)

AMERICAN AIRLINES


  • American Airlines' Program Valuation
  • Table 4-5 American Airlines’ Selected Operating Data, 2019-2020

AAdvantage Loyalty Program

DELTA AIR LINES


  • Delta’s Program Valuation
  • Delta SkyMiles and Flyer Loyalty Are Cornerstone of Revenue
  • Delta Looking for 2021 Revenue
  • Table 4-6 Categories of Delta Air Lines’ Operating Revenues, 2018-2020 ($billions)

JETBLUE AIRWAYS


  • Overview
  • Partnership with American Airlines
  • Enrolled vs. Elite Status
  • JetBlue’s Barclay’s Co-branded Credit Card
  • Illustration 4-1 JetBlue Card
  • Goldman Sachs Vies for JetBlue’s Co-branded Card Business
  • JetBlue Introduces Marcus Pay

SOUTHWEST AIRLINES


  • Overview
  • Southwest and the Pandemic
  • Even Southwest Lost Money in 2020
  • Table 4-7 Categories of Southwest Airlines Net Income, 2018-2020 ($billions)
  • Table 4-8 Categories of Southwest Airlines Operating Revenues, 2018-2020 ($billions)
  • Southwest’s Rapid Rewards
  • Rapid Rewards’ Response to Pandemic
  • Rapids Rewards Pivots in June 2021
  • Chase Visa and Southwest

UNITED AIRLINES


  • United Airlines’ Program Valuation
  • United Airlines’ MileagePlus Program
  • Figure 4-1 average Revenue per United Mileage Plus Member, 2015-220
  • United Introduces New Cards for Summer 2021
  • Illustration 4-2 United Personal Credit Cards

CHAPTER 5: HOTEL PARTNERSHIPS

INDUSTRY CONTEXT


  • Largest Group of Partnerships
  • Co-branded Relationships

HILTON WORLDWIDE


  • Table 5-1 Hilton’s Balance Sheet, Reflecting Point Presale to American Express, 2020 ($millions)
  • Hilton’s Response to COVID Pandemic
  • Hilton Honors Members Fill Rooms
  • How the Rewards Program Works for Hilton
  • Hilton Honors as an Engine of Revenue
  • Illustration 5-1 Hilton Honors American Express Cards
  • Key Hilton Honors Members Benefits for Booking Directly
  • Enhancing Member Benefits
  • Illustration 5-2 Daily Food and Beverage Credits for Hilton Guests

INTERCONTINENTAL HOTELS GROUP (IHG)


  • Overview
  • IHG’s Priorities for Growth
  • Employees
  • IHG’s Response to COVID-19
  • Pandemic Adjustments for Rewards Members
  • IHG Rewards
  • Illustration 5-3 IHG Rewards Club Mastercards Issued by Chase

MARRIOTT INTERNATIONAL


  • Overview
  • Marriott’s Response to COVID
  • COVID Drove Corporate Borrowing and Pre-Sale of Loyalty Points to Issuers
  • Sharp Rebound in Hotel Occupancy, But Still Far to Go
  • Table 5-2 Recovery in Marriott’s Business and Group Travel Business
  • The Marriott Bonvoy Loyalty Program
  • Illustration 5-4 New Marriott Bonvoy Co-branded Credit Card Promotions
  • Bonvoy Promotions
  • Illustration 5-5 Marriott Bonvoy Cross-Markets with Uber, 2021
  • Table 5-3 Purchase Volume, Marriott Co-branded Credit Cards, 2018-2020 ($billions)

CHAPTER 6: RETAILER PARTNERSHIPS

INDUSTRY CONTEXT


  • Store Cards and Co-branded Cards

AMAZON


  • Overview
  • Amazon Membership Surge
  • Amazon and Prime Member Loyalty
  • Income and Net Income Defy Pandemic
  • Table 6-1 Consolidated Income Statement for Amazon, 2018-2020
  • Amazon Prime Credit Cards
  • Table 6-2 Co-branded Credit Card Purchasing Volume and Receivables, Amazon, 2018-2020 ($billions)

COSTCO


  • Overview
  • Marketing Strategy
  • Loyal Shopping Members
  • Costco Anywhere Visa

TARGET


  • Overview
  • Target Was Ready for 2020
  • Figure 7-1 Prime Demographics for Co-branded Cards by Type of Affiliation (indexes)
  • Table 7-5c Co-branded Credit Card Usage Rates by Type and Consumer Demographic: Department Stores, Warehouse Clubs, Amazon/Prime, and Airline/Hotel, 2021 (index with base = 100)
  • Motivators to Apply for Co-Branded Cards
  • Table 7-6 Card Features or Benefits That Would “Strongly Influence” Consumer Decisions to Apply for a Co-Branded Credit Card, 2021
  • Table 7-7 Influence on Use of Co-Branded Credit Cards: By Type of Benefit, 2021 (percent of cardholders)
Note: Product cover images may vary from those shown
  • Amazon
  • American Airlines
  • American Express
  • Capital One
  • Citibank
  • Costco
  • Delta Air Lines
  • Hilton Worldwide
  • Intercontinental Hotels Group (IHG)
  • Jetblue Airways
  • JPMorgan Chase
  • Marriott International
  • Southwest Airlines
  • Synchrony Financial
  • Target
  • United Airlines
Note: Product cover images may vary from those shown