Indian millennials are prime target for co-branded cards: Manasi Narasimhan, Mastercard
Narasimhan, Vice President, Marketing & Communications, South Asia, Mastercard, talks about focusing on digital-first experience and how in India consumers are moving towards co-branded cards
The number of credit card users in the country has been growing steadily, according to experts. As per the latest RBI data, the number stands at 2.02 lakhs in 2019. Co-branded cards have also emerged as a key way to cater to the aspiring middle class that invests in experiences, they say. The cards strengthen brand preference and reward it accordingly.
Recently, Mastercard launched co-branded cards in partnership with Flipkart-Axis Bank, Matrix-Federal Bank and so on. Manasi Narasimhan, Vice President, Marketing and Communications, South Asia, Mastercard, spoke to exchange4media about how co-branded credit cards develop loyalty amongst consumers and why the trend is picking up in India.
What are the core categories where co-branded cards are driving spends?
According to a PwC report titled ‘Demystifying the co-branded cards industry’, travel is the most prominent use in this case, followed by fuel, e-commerce, and retail shopping. These segments offer tangible benefits like complimentary tickets and shopping vouchers which lead to instant gratification for the customers. For Mastercard, airline co-brands have done well across the world and e-retail has been a new category of co-brands. Mastercard recently launched, in partnership with Axis Bank and Flipkart, a large co-brand offering unmatched benefits for the consumers. We expect this to shape consumer behaviour significantly in the coming months. Mastercard is incidentally the leader in the global co-brand space and we focus significantly on a digital-first experience across the co-brands we operate in.
Do co-branded credit cards develop loyalty amongst consumers? Why is the trend picking up in India?
In the New India, consumers have access to information and choices which they never had in the past. With the power of shopping on their smartphone devices, consumers can be encouraged for real-time actions through carefully designed co-branded value proposition. An average Indian consumer could participate in 10 to 11 loyalty programmes conducted by retail chains, financial institutions, hospitality, entertainment and airline companies. The key is to design these programmes to suit the business objectives and consumer expectations.
The consumers with co-branded cards are aware about the rewards one card offers against the other. They can choose cards which match their needs in the best way. Over a period, as they engage and experience the products or services, their loyalty strengthens.
In India, we are increasingly seeing this behavioural change among consumers who sign up for co-branded cards. India is a young market and with the largest millennial population in Asia Pacific, we believe this audience is a prime target for co-branded cards. Over 80 per cent of Indian millennials, as per a recent Mastercard study, prefer to buy a brand that would tailor services to their needs.
How co-branded credit cards help merchants drive spends in tier 2 and 3 cities?
Digital India has eliminated 'information inequality' to a great extent. Therefore, tier 2 and 3 cities are continuously showing a promise towards digital payments. The rising aspirations and increasing spending power of people in these cities mean that there is a huge opportunity for merchants to drive consumer spending here, through co-branded cards. However, it is important to customise the value proposition according to the local needs and tastes. Mastercard has recently partnered with Axis Bank and Flipkart to launch a co-brand focused on going deeper into the hinterland. With the increasing usage of smartphones and the abundance of digital natives, this approach will help drive merchant spends by targeting specific affinity groups.
What role do influencers play in adoption of cards among different audience?
Making people aware about the new product offerings and propositions plays a crucial role in the success of a product. Influencers help give that soft nudge to the consumers to try the new offerings and create an aura of excitement around it. They can provide the much-needed personalised touch to make the product more desirable to the consumers. Influencers are seen as exemplars of passion points and can hence drive greater affinity towards the use of cards. Mastercard has recently engaged with popular influencers like cricketer Rohit Sharma and actor Karishma Kapoor to build awareness about the convenience, safety and exciting offers that can be availed on Mastercard-powered digital payments on select cards while travelling abroad.
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