Co-Branded Credit Cards in the US, 9th Edition

Table of Content

CHAPTER 1: EXECUTIVE SUMMARY

SCOPE OF REPORT

REPORT METHODOLOGY

CHAPTER 2: MARKET OVERVIEW

• PAYMENTS

Credit Card Industry During the Pandemic

Credit Card Industry Post-Pandemic

Consumer Credit - More Consumers Carry Unpaid Card Balances

Figure 2-1. Outstanding Revolving Consumer Credit, 2019-Q3 2023 ($ millions)

Rising Credit Card Receivables Increasingly Accompanied by Charge-off Growth

Servicing Debt Consumes More of Consumers' Income

Table 2-1. Average Monthly Debt Servicing Payments to Banks per Consumer, 2022-2023 (dollars)

Ubiquity of Credit Cards

• Table 2-2. Total Number, Value, and Dollar Average of Credit Card Payments, 2015, 2018, and

Key Challenges Facing the Co-Branded Credit Card Market

Health of Overall Economy

Rising Charge-Off Rates

Figure 2-2. Quarterly Credit Card Delinquency and Charge-Off Rates, 2018-2023

Credit Card Interest Rates

Table 2-3. All Credit Card Plans, Average Interest Rates, 2018-2022 (percent)

Aggressive Regulation of Late Fees by the CFPB

Late Fees Disproportionately Hit Subprime Borrowers

Late Fees Drive Profitability of All Issuers

Co-Branded Credit Cards are Not Optimizing Their Utility

Purchase Volume Trends for the Major Networks

Visa Purchase Volume Trends

American Express Purchase Volume Trends

Mastercard Purchase Volume Trends

Table 2-4. Purchase Volume for Mastercard, Visa and American Express, Quarterly, Q2 2022-Q2 2023 ($ billions)

Table 2-5. Largest Credit Card Issuers by Receivables, 2020-2022 ($ billion)

Longer Term Payment Trends Continue

Table 2-6. Monthly Consumer Payments, 2021 and 2022 (number of consumers and dollars per consumer)

December 20 ii 23 © Packaged Facts

Payment Method Choice and Consumer Age and Household Income

• Figure 2-3. How Banked Consumers Pay for Purchases,

Customer Acquisition

• Figure 2-4. Channel Used When Applying for a Credit Card,

Credit Card Issuer Responses to Pandemic

• Table 2-7. Revolving Credit - Change, Flow and Outstanding, 2016-Q1

Credit Card Issuers Responded to Lower Transaction Volumes During the Pandemic

Popular Categories of Rewards Benefits

Rewards Double-Dipping is a Top Priority

• Table 2-8. Ownership of Credit Card by Type,

Gen Z Learns Rewards Maximizing Hacks from TikTok

Travel Rewards Valued by Consumers

Older Consumers Most Unwilling to Pay Annual Fees for Travel Rewards

CHAPTER 3: THE ISSUERS

INDUSTRY CONTEXT

Components of Issuer Income

The Largest Issuers

Table 3-1. Credit Card Receivables, Leading Issuers, 2020-2022 ($ billion)

Co-Branded Card Users

Table 3-2. Top 10 US Co-Branded Credit Card Programs, by Purchase Volume, 2020-2022 ($ billion)

AMERICAN EXPRESS

Overview

Table 3-3. American Express Network Volume, 2020-2022 ($ billion)

Table 3-4. American Express Total Revenues Net of Interest Expense, 2020-2022 ($ million)

Strong Growth Across Major Business Categories

Table 3-5. American Express US Consumer Services Billed Business, Q1 2022-Q3 2023 ($ billion)

Competitor Differentiation

Table 3-6. Selected American Express Card-Related Statistics, 2020-2022

Future Growth

Leaning Hard into Millennials and Gen Z Consumers

Snapshots of Platinum and Centurion Cardholders

Achieving Acceptance Parity with Visa and Mastercard

Small Business Saturday and Lower Merchant Discounts

Expanding the Payments Platform Through Partnerships

Delta is an "Important Source of Value" for AmEx Cardholders

Co-Branded Card Volumes

BANK OF AMERICA

Overview

• Figure 3-1. Sample Bank of America Credit Cards,

Bank of America Focused on Organic Growth

December 2023 © Packaged Facts iii

Large Fines for Denying Reward Payments and Other Infractions

CAPITAL ONE

Overview

Capital One Purchase and Receivables Volumes

Table 3-7. Capital One Credit Card Purchase Volume and Receivables, 2020-2022 ($ billion)

Table 3-8. Capital One Co-Branded Credit Cards, Purchase Volume and Outstandings, 2020-2022 ($ billion)

Key Program Partner: Walmart

JPMORGAN CHASE

Overview

Chase is Very Upbeat About the Economic Health of US Citizens

Chase is the Largest Credit Card Issuer

Snapshot of 2022 Consumer Lending

Table 3-9. JPMorgan Chase Credit Card Sales Volume and New Accounts, 2020-2022 ($ billion and # million)

Chase Credit Card Income

Table 3-10. Components of JPMorgan Chase Credit Card Income, 2020-2022 ($ billions)

Chase Issues Many of the Largest Co-Branded Programs

• Figure 3-2. JPMorgan Chase Co-Branded Programs,

Table 3-11. JPMorgan Chase Co-Branded Credit Cards: Purchase Volume and Outstandings, 2020-2022 ($ billion)

CITIBANK

Overview

Table 3-12. Citibank, Total Credit Card Portfolio, Outstandings and Purchase Volume, 2020-2022 ($ billion)

Citi Branded Cards

Citi's Retail Services

Table 3-13. Citibank Co-Branded Credit Card Purchase Value and Loan Receivables, 2020-2022 ($ billion)

SYNCHRONY FINANCIAL

Overview

Table 3-14. Key Synchrony Financial and Performance Metrics, 2019-2022 ($ billion and # million)

Leveraging Synchrony's Bank for Lower-Cost Funding

Despite Broad Range of Customers, Synchrony Dependent on its Five Largest Programs

Dual Cards are Focus of Sales Development

Operating Segments Replaced by Industry Sales Platforms for Financial Reporting

• Figure 3-3. Synchrony's Key Performance Metrics by Sales Vertical,

Home & Auto

Digital

Diversified & Value

Health & Wellness

CareCredit Could Become Huge Dual Card

December 20 iv 23 © Packaged Facts

Synchrony's Expansion into BNPL

Table 3-15. Synchrony Financial Co-Branded Credit Card Purchase Value and Loan Receivables, 2020-2022 ($ billion)

U.S. BANK

OTHER ISSUERS

Note on Other Banks

CHAPTER 4: AIRLINE PARTNERSHIPS

INDUSTRY CONTEXT

2022 and 2023 Were Airline Years of Recovery

Table 4-1. Operating Revenue, US Airlines, 2019-2022 ($ billion)

Airline Loyalty Programs

After Cash, Travel Rewards Are the Most Popular Credit Card Reward

• Table 4-2. Ownership of Credit Card by Type,

The Power of Co-Branded Credit Cards to Drive Behavior

Table 4-3. Leisure and Business Co-Branded Credit Card Owners Declining Miles Earning, 2016-2018

Profits from a "Free" Award Ticket

Table 4-4. Issuer Profits from Travel Award Ticket

US Airlines Are Mileage Marketing Companies with Loyalty Flights

• Table 4-5. Market Value of Largest US Airline Frequent Flyer Programs,

AMERICAN AIRLINES

Overview

Table 4-6. American Airlines' Selected Operating Data, 2021-2022

AAdvantage Loyalty Program

Leveraging the Strength of Global Alliances

DELTA AIR LINES

Overview

Table 4-7. Delta Air Lines Selected Operating Data, 2021-2022

Competitive Advantages and Brand Strength

Delta SkyMiles and Flyer Loyalty Are Cornerstone of Revenue

Table 4-8. Categories of Delta Air Lines' Operating Revenues, 2021-2022 ($ million)

Delta is an "Important Source of Value" for AmEx Cardholders

SOUTHWEST AIRLINES

Overview

Hard to Keep a Great Airline Down

Table 4-9. Categories of Southwest Airlines Net Income, 2020-2022 ($ billion)

Table 4-10. Categories of Southwest Airlines Operating Revenues, 2021-2022 ($ billion)

Southwest's Rapid Rewards

Investments in Customer Experience

Marketing

Chase Visa and Southwest

December 2023 © Packaged Facts v

UNITED AIRLINES

Overview

United Airlines MileagePlus Program Valuation

United Airlines' MileagePlus Program

Table 4-11. United Airlines' Selected Operating Data, 2021-2022

MileagePlus Members Drive the Airlines Profitability

Figure 4-1. Average Revenue per United MileagePlus Member, 2015-2020

CHAPTER 5: HOTEL PARTNERSHIPS

INDUSTRY CONTEXT

Largest Group of Partnerships

Who is Traveling?

• Figure 5-1. Millennial and Gen Z Lodging Spend with American Express,

Co-Branded Relationships

HILTON WORLDWIDE

Overview

Financial Performance of Hilton Honors

Figure 5-2. Hilton Honors American Express Cards

Hilton Honors as an Engine of Revenue

• Figure 5-3. Hilton Honors Key Investor Metrics, August

Key Hilton Honors Members Benefits for Booking Directly

Enhancing Member Benefits

Figure 5-4. Daily Food and Beverage Credits for Hilton Guests

INTERCONTINENTAL HOTELS GROUP (IHG)

Overview

IHG Relaunches Loyalty Program as One Rewards

Relaunch of Chase Co-Branded Credit Card

Figure 5-5. IHG One Rewards Chase Mastercard

IHG's Status Report on Strategic Priorities

MARRIOTT INTERNATIONAL

Overview

US and Global Market Share

Marriott Still Not Fully Recovered to 2019 Performance

• Figure 5-6. Strong ADR Growth Greatly Offset Impact of Occupancy Declines,

Marriott is a Truly International Brand

The Marriott Bonvoy Loyalty Program

Deepening Member Experience With Bonvoy Moments

COVID Drove Pre-Sale of Loyalty Points to Co-Branded Credit Card Issuers

New Credit Card Products Tied to Bonvoy

• Figure 5-7. New Marriott Bonvoy Co-Branded Cards, September

Table 5-1. Purchase Volume, Marriott Co-Branded Credit Cards, 2020-2022 ($ billions)

December 20 vi 23 © Packaged Facts

CHAPTER 6: RETAILER PARTNERSHIPS

INDUSTRY CONTEXT

Store Cards and Co-Branded Cards

Retailers Enhancing Financing and Loyalty Program Flexibility

AMAZON

Overview

Amazon Drives Revenue by Reimagining Use Cases for its Systems

Amazon is Online Shopping Destination Regardless of Household Income

• Table 6-1. Most Popular Online Retailers by Shopper Household Income,

Prime Membership Subscriber Numbers are Stagnating

Table 6-2. Amazon Prime Customers: Numbers, Growth and Penetration Rate Among Shoppers, 2019-2022

Amazon Fights With Visa in the UK

Amazon Played Hardball With JPMorgan Chase

Table 6-3. Amazon Net Sales by Group, 2020-H1 2023 ($ billion)

Amazon Shopper Demographics are Attractive to Issuers and Networks

Figure 6-1. Amazon Co-Branded Credit Cards

Amazon Prime Credit Cards

Table 6-4. Co-Branded Credit Card Purchasing Volume and Receivables, Amazon, 2020-2022 ($ billions)

COSTCO

Overview

Marketing Strategy

Loyal Shopping Members

Costco Anywhere Visa

Table 6-5. Costco, Co-Branded Credit Card Purchasing Volume and Receivables, 2020-2022 ($ billions)

TARGET

Overview

Figure 6-2. Target Annual Revenue, 2019-2022 ($ billion)

The RedCard Juggernaut

Target Circle Brings Non-RedCard Shoppers into Marketing Engine

RedCard and Circle are in Tension

Table 6-6. Target Key Financials and Co-Branded Purchase Volume, 2020-2022 ($ billion)

Circle Loyalty Program is Focus of Heavy Promotion

TD Bank Issues the Target RedCards

WALMART

Overview

Leveraging Fintechs Even and One to Target Walmart Employees

Fintech "Super App" ONE May Issue Walmart Credit Cards

December 2023 © Packaged Facts vii

Table 6-7. Walmart, Co-Branded Credit Card Purchasing Volume and Receivables, 2020-2022 ($ billions)

CHAPTER 7: THE CONSUMER

CO-BRANDED CREDIT CARDS IN CONTEXT

Credit Outcomes and Perceptions

• Table 7-1. Denied Credit or Approved For Less Than Was Requested (By Family Income and Race/Ethnicity),

Credit Cards

Three-Fourths of Adults Have Credit Cards

Table 7-2. Major Credit Card Customer Base: Have in Own Name vs. Used in Last 30 Days, 2021 (percent and number of adults)

30% Have Co-Branded Cards

Table 7-3. Customer Base for Co-Branded vs. Store-Only Credit Cards: Have in Own Name vs. Used in Last 30 Days, 2021 (percent and number of adults)

Co-Branded Cardholder Demographics

Table 7-4a. Credit Card Usage Rates by Consumer Demographic: Major Credit Cards Overall, Store-Only Cards, and Co-Branded Cards, 2021 (percent of adults who are cardholders)

Table 7-4b. Credit Card Customer Base by Consumer Demographic: Major Credit Cards Overall, Store-Only Cards, and Co-Branded Cards, 2021 (number of adults in thousands)

Table 7-4c. Credit Card Usage Index by Consumer Demographic: Major Credit Cards Overall, Store-Only Cards, and Co-Branded Cards, 2021 (index with base = 100)

Co-Branded Card Patterns by Type of Affiliation

Table 7-5a. Co-Branded Credit Card Usage Rates by Selected Types: Have in Own Name vs. Used in Last 30 Days, 2021 (percent of adults)

Table 7-5b. Co-Branded Credit Card Usage Rates by Selected Types: Have in Own Name vs. Used in Last 30 Days, 2021 (number of adults in thousands)

Co-Branded Card Demographics by Type of Affiliation

Figure 7-2. Prime Demographics for Co-Branded Cards by Type of Affiliation (indexes)

Table 7-6a. Co-Branded Credit Card Usage Rates by Type and Consumer Demographic: Department Stores, Warehouse Clubs, Amazon/Prime, and Airline/Hotel, 2021 (percent of adults who are cardholders)

Table 7-6b. Co-Branded Credit Card Usage Rates by Type and Consumer Demographic: Department Stores, Warehouse Clubs, Amazon/Prime, and Airline/Hotel 2021 (number of adults in thousands)

Table 7-6c. 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 7-7. Card Features or Benefits That Would "Strongly Influence" Consumer Decisions to Apply for a Co-Branded Credit Card,

Table 7-8. Influence on Use of Co-Branded Credit Cards: By Type of Benefit, 2021 (percent of cardholders)

CHAPTER 1: EXECUTIVE SUMMARY

SCOPE OF REPORT

REPORT METHODOLOGY

CHAPTER 2: MARKET OVERVIEW

• PAYMENTS

Credit Card Industry During the Pandemic

Credit Card Industry Post-Pandemic

Consumer Credit - More Consumers Carry Unpaid Card Balances

Figure 2-1. Outstanding Revolving Consumer Credit, 2019-Q3 2023 ($ millions)

Rising Credit Card Receivables Increasingly Accompanied by Charge-off Growth

Servicing Debt Consumes More of Consumers' Income

Table 2-1. Average Monthly Debt Servicing Payments to Banks per Consumer, 2022-2023 (dollars)

Ubiquity of Credit Cards

• Table 2-2. Total Number, Value, and Dollar Average of Credit Card Payments, 2015, 2018, and

Key Challenges Facing the Co-Branded Credit Card Market

Health of Overall Economy

Rising Charge-Off Rates

Figure 2-2. Quarterly Credit Card Delinquency and Charge-Off Rates, 2018-2023

Credit Card Interest Rates

Table 2-3. All Credit Card Plans, Average Interest Rates, 2018-2022 (percent)

Aggressive Regulation of Late Fees by the CFPB

Late Fees Disproportionately Hit Subprime Borrowers

Late Fees Drive Profitability of All Issuers

Co-Branded Credit Cards are Not Optimizing Their Utility

Purchase Volume Trends for the Major Networks

Visa Purchase Volume Trends

American Express Purchase Volume Trends

Mastercard Purchase Volume Trends

Table 2-4. Purchase Volume for Mastercard, Visa and American Express, Quarterly, Q2 2022-Q2 2023 ($ billions)

Table 2-5. Largest Credit Card Issuers by Receivables, 2020-2022 ($ billion)

Longer Term Payment Trends Continue

Table 2-6. Monthly Consumer Payments, 2021 and 2022 (number of consumers and dollars per consumer)

December 20 ii 23 © Packaged Facts

Payment Method Choice and Consumer Age and Household Income

• Figure 2-3. How Banked Consumers Pay for Purchases,

Customer Acquisition

• Figure 2-4. Channel Used When Applying for a Credit Card,

Credit Card Issuer Responses to Pandemic

• Table 2-7. Revolving Credit - Change, Flow and Outstanding, 2016-Q1

Credit Card Issuers Responded to Lower Transaction Volumes During the Pandemic

Popular Categories of Rewards Benefits

Rewards Double-Dipping is a Top Priority

• Table 2-8. Ownership of Credit Card by Type,

Gen Z Learns Rewards Maximizing Hacks from TikTok

Travel Rewards Valued by Consumers

Older Consumers Most Unwilling to Pay Annual Fees for Travel Rewards

CHAPTER 3: THE ISSUERS

INDUSTRY CONTEXT

Components of Issuer Income

The Largest Issuers

Table 3-1. Credit Card Receivables, Leading Issuers, 2020-2022 ($ billion)

Co-Branded Card Users

Table 3-2. Top 10 US Co-Branded Credit Card Programs, by Purchase Volume, 2020-2022 ($ billion)

AMERICAN EXPRESS

Overview

Table 3-3. American Express Network Volume, 2020-2022 ($ billion)

Table 3-4. American Express Total Revenues Net of Interest Expense, 2020-2022 ($ million)

Strong Growth Across Major Business Categories

Table 3-5. American Express US Consumer Services Billed Business, Q1 2022-Q3 2023 ($ billion)

Competitor Differentiation

Table 3-6. Selected American Express Card-Related Statistics, 2020-2022

Future Growth

Leaning Hard into Millennials and Gen Z Consumers

Snapshots of Platinum and Centurion Cardholders

Achieving Acceptance Parity with Visa and Mastercard

Small Business Saturday and Lower Merchant Discounts

Expanding the Payments Platform Through Partnerships

Delta is an "Important Source of Value" for AmEx Cardholders

Co-Branded Card Volumes

BANK OF AMERICA

Overview

• Figure 3-1. Sample Bank of America Credit Cards,

Bank of America Focused on Organic Growth

December 2023 © Packaged Facts iii

Large Fines for Denying Reward Payments and Other Infractions

CAPITAL ONE

Overview

Capital One Purchase and Receivables Volumes

Table 3-7. Capital One Credit Card Purchase Volume and Receivables, 2020-2022 ($ billion)

Table 3-8. Capital One Co-Branded Credit Cards, Purchase Volume and Outstandings, 2020-2022 ($ billion)

Key Program Partner: Walmart

JPMORGAN CHASE

Overview

Chase is Very Upbeat About the Economic Health of US Citizens

Chase is the Largest Credit Card Issuer

Snapshot of 2022 Consumer Lending

Table 3-9. JPMorgan Chase Credit Card Sales Volume and New Accounts, 2020-2022 ($ billion and # million)

Chase Credit Card Income

Table 3-10. Components of JPMorgan Chase Credit Card Income, 2020-2022 ($ billions)

Chase Issues Many of the Largest Co-Branded Programs

• Figure 3-2. JPMorgan Chase Co-Branded Programs,

Table 3-11. JPMorgan Chase Co-Branded Credit Cards: Purchase Volume and Outstandings, 2020-2022 ($ billion)

CITIBANK

Overview

Table 3-12. Citibank, Total Credit Card Portfolio, Outstandings and Purchase Volume, 2020-2022 ($ billion)

Citi Branded Cards

Citi's Retail Services

Table 3-13. Citibank Co-Branded Credit Card Purchase Value and Loan Receivables, 2020-2022 ($ billion)

SYNCHRONY FINANCIAL

Overview

Table 3-14. Key Synchrony Financial and Performance Metrics, 2019-2022 ($ billion and # million)

Leveraging Synchrony's Bank for Lower-Cost Funding

Despite Broad Range of Customers, Synchrony Dependent on its Five Largest Programs

Dual Cards are Focus of Sales Development

Operating Segments Replaced by Industry Sales Platforms for Financial Reporting

• Figure 3-3. Synchrony's Key Performance Metrics by Sales Vertical,

Home & Auto

Digital

Diversified & Value

Health & Wellness

CareCredit Could Become Huge Dual Card

December 20 iv 23 © Packaged Facts

Synchrony's Expansion into BNPL

Table 3-15. Synchrony Financial Co-Branded Credit Card Purchase Value and Loan Receivables, 2020-2022 ($ billion)

U.S. BANK

OTHER ISSUERS

Note on Other Banks

CHAPTER 4: AIRLINE PARTNERSHIPS

INDUSTRY CONTEXT

2022 and 2023 Were Airline Years of Recovery

Table 4-1. Operating Revenue, US Airlines, 2019-2022 ($ billion)

Airline Loyalty Programs

After Cash, Travel Rewards Are the Most Popular Credit Card Reward

• Table 4-2. Ownership of Credit Card by Type,

The Power of Co-Branded Credit Cards to Drive Behavior

Table 4-3. Leisure and Business Co-Branded Credit Card Owners Declining Miles Earning, 2016-2018

Profits from a "Free" Award Ticket

Table 4-4. Issuer Profits from Travel Award Ticket

US Airlines Are Mileage Marketing Companies with Loyalty Flights

• Table 4-5. Market Value of Largest US Airline Frequent Flyer Programs,

AMERICAN AIRLINES

Overview

Table 4-6. American Airlines' Selected Operating Data, 2021-2022

AAdvantage Loyalty Program

Leveraging the Strength of Global Alliances

DELTA AIR LINES

Overview

Table 4-7. Delta Air Lines Selected Operating Data, 2021-2022

Competitive Advantages and Brand Strength

Delta SkyMiles and Flyer Loyalty Are Cornerstone of Revenue

Table 4-8. Categories of Delta Air Lines' Operating Revenues, 2021-2022 ($ million)

Delta is an "Important Source of Value" for AmEx Cardholders

SOUTHWEST AIRLINES

Overview

Hard to Keep a Great Airline Down

Table 4-9. Categories of Southwest Airlines Net Income, 2020-2022 ($ billion)

Table 4-10. Categories of Southwest Airlines Operating Revenues, 2021-2022 ($ billion)

Southwest's Rapid Rewards

Investments in Customer Experience

Marketing

Chase Visa and Southwest

December 2023 © Packaged Facts v

UNITED AIRLINES

Overview

United Airlines MileagePlus Program Valuation

United Airlines' MileagePlus Program

Table 4-11. United Airlines' Selected Operating Data, 2021-2022

MileagePlus Members Drive the Airlines Profitability

Figure 4-1. Average Revenue per United MileagePlus Member, 2015-2020

CHAPTER 5: HOTEL PARTNERSHIPS

INDUSTRY CONTEXT

Largest Group of Partnerships

Who is Traveling?

• Figure 5-1. Millennial and Gen Z Lodging Spend with American Express,

Co-Branded Relationships

HILTON WORLDWIDE

Overview

Financial Performance of Hilton Honors

Figure 5-2. Hilton Honors American Express Cards

Hilton Honors as an Engine of Revenue

• Figure 5-3. Hilton Honors Key Investor Metrics, August

Key Hilton Honors Members Benefits for Booking Directly

Enhancing Member Benefits

Figure 5-4. Daily Food and Beverage Credits for Hilton Guests

INTERCONTINENTAL HOTELS GROUP (IHG)

Overview

IHG Relaunches Loyalty Program as One Rewards

Relaunch of Chase Co-Branded Credit Card

Figure 5-5. IHG One Rewards Chase Mastercard

IHG's Status Report on Strategic Priorities

MARRIOTT INTERNATIONAL

Overview

US and Global Market Share

Marriott Still Not Fully Recovered to 2019 Performance

• Figure 5-6. Strong ADR Growth Greatly Offset Impact of Occupancy Declines,

Marriott is a Truly International Brand

The Marriott Bonvoy Loyalty Program

Deepening Member Experience With Bonvoy Moments

COVID Drove Pre-Sale of Loyalty Points to Co-Branded Credit Card Issuers

New Credit Card Products Tied to Bonvoy

• Figure 5-7. New Marriott Bonvoy Co-Branded Cards, September

Table 5-1. Purchase Volume, Marriott Co-Branded Credit Cards, 2020-2022 ($ billions)

December 20 vi 23 © Packaged Facts

CHAPTER 6: RETAILER PARTNERSHIPS

INDUSTRY CONTEXT

Store Cards and Co-Branded Cards

Retailers Enhancing Financing and Loyalty Program Flexibility

AMAZON

Overview

Amazon Drives Revenue by Reimagining Use Cases for its Systems

Amazon is Online Shopping Destination Regardless of Household Income

• Table 6-1. Most Popular Online Retailers by Shopper Household Income,

Prime Membership Subscriber Numbers are Stagnating

Table 6-2. Amazon Prime Customers: Numbers, Growth and Penetration Rate Among Shoppers, 2019-2022

Amazon Fights With Visa in the UK

Amazon Played Hardball With JPMorgan Chase

Table 6-3. Amazon Net Sales by Group, 2020-H1 2023 ($ billion)

Amazon Shopper Demographics are Attractive to Issuers and Networks

Figure 6-1. Amazon Co-Branded Credit Cards

Amazon Prime Credit Cards

Table 6-4. Co-Branded Credit Card Purchasing Volume and Receivables, Amazon, 2020-2022 ($ billions)

COSTCO

Overview

Marketing Strategy

Loyal Shopping Members

Costco Anywhere Visa

Table 6-5. Costco, Co-Branded Credit Card Purchasing Volume and Receivables, 2020-2022 ($ billions)

TARGET

Overview

Figure 6-2. Target Annual Revenue, 2019-2022 ($ billion)

The RedCard Juggernaut

Target Circle Brings Non-RedCard Shoppers into Marketing Engine

RedCard and Circle are in Tension

Table 6-6. Target Key Financials and Co-Branded Purchase Volume, 2020-2022 ($ billion)

Circle Loyalty Program is Focus of Heavy Promotion

TD Bank Issues the Target RedCards

WALMART

Overview

Leveraging Fintechs Even and One to Target Walmart Employees

Fintech "Super App" ONE May Issue Walmart Credit Cards

December 2023 © Packaged Facts vii

Table 6-7. Walmart, Co-Branded Credit Card Purchasing Volume and Receivables, 2020-2022 ($ billions)

CHAPTER 7: THE CONSUMER

CO-BRANDED CREDIT CARDS IN CONTEXT

Credit Outcomes and Perceptions

• Table 7-1. Denied Credit or Approved For Less Than Was Requested (By Family Income and Race/Ethnicity),

Credit Cards

Three-Fourths of Adults Have Credit Cards

Table 7-2. Major Credit Card Customer Base: Have in Own Name vs. Used in Last 30 Days, 2021 (percent and number of adults)

30% Have Co-Branded Cards

Table 7-3. Customer Base for Co-Branded vs. Store-Only Credit Cards: Have in Own Name vs. Used in Last 30 Days, 2021 (percent and number of adults)

Co-Branded Cardholder Demographics

Table 7-4a. Credit Card Usage Rates by Consumer Demographic: Major Credit Cards Overall, Store-Only Cards, and Co-Branded Cards, 2021 (percent of adults who are cardholders)

Table 7-4b. Credit Card Customer Base by Consumer Demographic: Major Credit Cards Overall, Store-Only Cards, and Co-Branded Cards, 2021 (number of adults in thousands)

Table 7-4c. Credit Card Usage Index by Consumer Demographic: Major Credit Cards Overall, Store-Only Cards, and Co-Branded Cards, 2021 (index with base = 100)

Co-Branded Card Patterns by Type of Affiliation

Table 7-5a. Co-Branded Credit Card Usage Rates by Selected Types: Have in Own Name vs. Used in Last 30 Days, 2021 (percent of adults)

Table 7-5b. Co-Branded Credit Card Usage Rates by Selected Types: Have in Own Name vs. Used in Last 30 Days, 2021 (number of adults in thousands)

Co-Branded Card Demographics by Type of Affiliation

Figure 7-2. Prime Demographics for Co-Branded Cards by Type of Affiliation (indexes)

Table 7-6a. Co-Branded Credit Card Usage Rates by Type and Consumer Demographic: Department Stores, Warehouse Clubs, Amazon/Prime, and Airline/Hotel, 2021 (percent of adults who are cardholders)

Table 7-6b. Co-Branded Credit Card Usage Rates by Type and Consumer Demographic: Department Stores, Warehouse Clubs, Amazon/Prime, and Airline/Hotel 2021 (number of adults in thousands)

Table 7-6c. 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 7-7. Card Features or Benefits That Would "Strongly Influence" Consumer Decisions to Apply for a Co-Branded Credit Card,

Table 7-8. Influence on Use of Co-Branded Credit Cards: By Type of Benefit, 2021 (percent of cardholders)