The great travel-rewards shakeup

Credit card reward system has always been an important marketing tool for banks to promote their credit cards. Recently, travel reward system is becoming a new hit. Canadian banks like TD and CIBC are now promoting this new revenue stream to attract new customers.

While different banks are imitating each other, they choose different approach among advertisement. For CIBC, they decide to advertise within their own channel– by directly communicate with their customers; while TD will taking mass-market advertising as their advertisement channel.

For me, choosing different advertisement channel is one kind of marketing strategy too. Since the product itself is easy to subside, different banks need to use different channels to increase their product uniqueness. Like Aeroplan, they decide to differ themselves from other advertisers by reaching their members “one on one”.

Although travel-reward program is getting great success in Canadian credit card market right now, I still believe Canadian banks need to stop imitate each other and come up with their unique credit card reward system. Using different advertising channel does not change the fact that those travel reward systems are identical. To gain greater success and attract more customer segment, banks need to come up with unique products. What I recommend banks to do is to do more market research and identify which direction they need to go to gain more loyal customers.