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How card issuers can drive long-term loyalty from cardmembers in 2022

Jan. 10, 2022
13 min read
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Editor’s note: This post has been updated with new information.


Throughout the last few years, we've seen a range of innovations from card issuers meant to attract and retain cardholders, from limited-time offers to new and refreshed cards.

However, as we start 2022, how can issuers drive long-term loyalty?

Credit card companies generally only make money when you use your card. So, card issuers usually don’t profit from cardmembers who sign up for cards offering large bonuses, shelve the card after earning the bonus and then close the card a year or two later. Card issuers need long-term relationships with cardmembers to maximize their profits.

Here are seven ways I believe card issuers can improve cardmember loyalty.

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Make it easy to keep and use cards

Issuers must encourage cardholders to use their cards. (Photo by Orli Friedman/The Points Guy)

There are two types of cards that I never consider closing:

Although I rarely use some of these cards, I benefit from keeping these cards open. After all, the no-annual-fee cards keep my credit utilization ratio low and account age high. And I happily keep my hotel credit cards open since their annual free night certificates typically provide more value than their annual fees.

But card issuers don’t benefit from consumers who keep their cards but don't spend much on them. We’ve even seen some card issuers close or decrease the credit limit on unused and underutilized cards.

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So, especially in the case of no-annual-fee cards, card issuers need to find ways to encourage consumers to use their cards. This is likely why Chase improved the Chase Freedom Unlimited‘s earning rates and created the Chase Freedom Flex. Likewise, programs such as Citi Merchant Offers and Amex Offers encourage consumers to engage with the programs and use their cards.

However, as I’ll discuss in other sections of this guide, improved earning rates and statement credits aren’t the only way to encourage cardmembers to use their cards.

Related: Why you should get (and keep) a no-annual-fee credit card

Unique, must-have perks

Centurion Lounge access is a compelling reason to be loyal to American Express. (Photo by Zach Griff/The Points Guy)

Some cards offer unique perks that can encourage long-term cardholder loyalty. For example, here are some cards that a cardholder might decide to keep long term rather than lose one or more of the card’s perks:

The information for the Hilton Aspire Amex card has been collected independently by The Points Guy. The card details on this page have not been reviewed or provided by the card issuer.

Out of these perks, only Centurion Lounge access is unique to having a specific card or cards. After all, you could buy a Delta Sky Club or Admirals Club membership, get access to a Capital One lounge when flying in a premium cabin on select airlines or earn Hilton Diamond status organically. But having one of these cards is often a less expensive way of gaining these perks.

Some cardholders also covet having perks such as Centurion Lounge access. For example, I plan to keep a card that offers Centurion Lounge access for the foreseeable future because I cherish comfort when transiting airports, even if the cost of the card doesn't make financial sense. Card issuers can lean into these emotional attachments to help improve long-term loyalty.

Another perk that often encourages me to keep and use a card is a high earning rate on a spending category that I use frequently. For example, I currently keep the Citi Premier® Card in my wallet for an effective 5.1% return at gas stations (based on the 3 points per dollar earnings on gas purchases and TPG’s most recent valuations). However, I’ll only stay loyal as long as another card doesn’t rival the earning rate and my spending level in the category remains high.

Finally, it’s worth pointing out that one of the most notable trends of the past two years is growth in cobranded perks. For example, in the past two years, we’ve seen the following new partnerships launch:

As card issuers seek to further engage with their customers’ lives, adding new partnerships and offers will likely drive long-term loyalty.

Related: From more flexibility to more lounges: My 2022 predictions for credit card rewards

Surprise-and-delight campaigns

A surprise gift from a loyalty program or card issuer can help improve loyalty. (Photo by South_agency/Getty Images)

If you frequently visit a local small business, you may find that the merchant sometimes offers you a complimentary surprise. For example, your favorite restaurant might provide you with a free dessert. Your favorite coffee shop might offer you a free cup of coffee. And your local golf course may give you a complimentary bucket of range balls. All of these perks are to recognize and reward your loyalty.

Some card issuers have also recognized their most valuable customers with these types of surprises. For example, Amex has sent holiday gifts to targeted customers and has occasionally sent Centurion cardholders gifts. Amex even surprised Centurion lounge visitors with holiday gifts a couple of years ago.

But card issuers could make their surprise-and-delight campaigns more personal and targeted. For example, suppose Chase knows you use your Chase Freedom Unlimited every morning for a $5 purchase at a coffee shop. In that case, the issuer could occasionally provide you a $5 statement credit for your purchase at that coffee shop. Or, if Amex knows you used your Amex Platinum Card to book flights to Hawaii and a stay at a Fine Hotels & Resorts hotel in Hawaii, the issuer could deliver a note and small gift to your room.

These gestures can build long-term cardmember loyalty. I was in the TPG office once when Brian Kelly, TPG's founder and CEO, received a Centurion cardholder gift, and I can attest that he was sincerely pleased. Likewise, my parents are loyal to Capital One, primarily due to a positive experience many years ago. Although some cardholders may not be impressed by small gifts, these campaigns have the potential to boost long-term loyalty for relatively little cost.

Related: Is this the creepiest — or best — hotel welcome amenity ever?

Valuable rewards

Transferring Chase Ultimate Rewards points to World of Hyatt may keep you loyal to Chase. (Photo by Victoria Walker/The Points Guy)

When voting for the TPG Awards winners in 2020, we asked respondents to select their three most important considerations when applying for a new credit card. The top three responses were:

TPG readers clearly care about rewards — which means that, to drive long-term loyalty, card issuers need to maintain the value of the rewards offered. For transferrable currencies, this could mean periodically adding new transfer partners, improving transfer ratios, launching transfer bonuses or boosting the value of non-travel redemptions.

As new card products enter the market or improve their rewards structure, card issuers also must reevaluate their rewards’ competitiveness to maintain current cardholders.

Related: This is how TPG is changing points and miles valuations for the better

Personalized perks and bonuses

A personalized offer may bring joy to your face. (Photo by JGI/Jamie Grill/Getty Images)

Card issuers extend targeted offers through programs like Amex Offers, Chase Offers and Bank of America’s BankAmeriDeals. And these targeted offers are often something I consider when deciding whether it’s worth keeping a card. However, by taking these targeted offers to the next level, issuers could seriously drive long-term loyalty.

Specifically, card issuers know which of their cards you have, and they know what the average consumer in your demographic spends. So, a company could attempt to snatch loyalty from other issuers by offering bonus spending opportunities in categories where you aren’t currently using their cards. (Of course, issuers would need to find the sweet spot that keeps you spending on their cards but doesn't give away too many rewards)

Card issuers could also boost long-term loyalty by offering customized benefits and earning rates. For example, just as you can choose a preferred airline for your airline fee credit on the Amex Platinum, perhaps you could also select one hotel brand or restaurant chain for elevated earning rates. Or card issuers could offer targeted challenges that let you earn rewards based on your spending and redemption activities.

Related: Extreme couponing: How credit card merchant offers can save you hundreds of dollars every year

Educate cardholders about card benefits

It can be challenging to figure out how to maximize credit card benefits and rewards on your own. (Photo by fizkes/Shutterstock)

When speaking with family and friends, I’m often surprised to learn how little they know about their card benefits. And it’s been great to see some of these friends and family members begin to use card benefits such as lounge access, purchase protection and trip delay protection after a short crash course. Some of these same friends and family have also started to transfer rewards to partners instead of merely booking travel through the card issuer’s travel portal or redeeming for gift cards.

For most of my loved ones, knowing how to use their card's perks and rewards keeps them loyal. They could earn more rewards by switching to another card or program, but they prefer to stay with the card and program they know. Card issuers could boost long-term loyalty by providing better education about a card's benefits and rewards.

Related: Credit cards that can get you $1,000 or more in first-year value

High-quality customer support

Getting friendly, helpful support without a long wait can keep cardholders loyal. (Photo by 10’000 Hours/Getty Images)

Customer service likely isn't one of your primary considerations when applying for a new credit card — but it can make or break a cardmember’s long-term loyalty.

For example, I’ve almost always gotten knowledgeable and friendly phone representatives when calling American Express. On the other hand, I’ve been so frustrated with Citi’s phone support and website at times that I’ve considered calling it quits on my Citi credit cards. My parents won’t carry any Chase credit cards due to a poor experience many years ago.

As such, high-quality customer service is an underrated but critical element of long-term cardmember loyalty.

Related: Battle of the premium credit cards: Comparing concierge services

Bottom line

Loyalty is a difficult aspect for card issuers to master. After all, some cardmembers remain loyal to a card simply because it was their first card or they like the design. Meanwhile, other cardmembers chase welcome bonuses, low interest rates or 0% ARP offers.

All that said, card issuers have a strong financial incentive to figure out what will make you loyal in the long term, and this is especially true if you are one of the issuer’s most valuable cardmembers. I expect we’ll see card issuers laser-focused on increasing cardmember loyalty as they shift toward better personalization of offers and benefits.

Featured image by Getty Images/Westend61
Editorial disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airline or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

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How we chose these cards

Our points-obsessed staff uses a plethora of credit cards on a daily basis. If anyone on our team wouldn’t recommend it to a friend or a family member, we wouldn’t recommend it on The Points Guy either. Our opinions are our own, and have not been reviewed, approved, or endorsed by our advertising partners.
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TPG featured card

Best card for premium perks while traveling
TPG Editor‘s Rating
Card Rating is based on the opinion of TPG‘s editors and is not influenced by the card issuer.
4 / 5
Go to review

Rewards

2 - 10X points
10XEarn unlimited 10X miles on hotels and rental cars booked through Capital One Travel
5X5X miles on flights booked through Capital One Travel.
2X2 Miles per dollar on every purchase, every day

Intro offer

75,000 bonus miles
Earn 75,000 bonus miles when you spend $4,000 on purchases in the first 3 months from account opening, equal to $750 in travel

Annual Fee

$395

Recommended Credit

740-850
Excellent
Credit ranges are a variation of FICO© Score 8, one of many types of credit scores lenders may use when considering your credit card application.

Why We Chose It

The Capital One Venture X card is one of the best all-round travel credit cards ever launched. Not only is it offering a tremendous welcome bonus, but cardholders can earn tons of miles on everyday spending and receive a 10,000-mile anniversary bonus to boot. Its annual fee is $395, but cardholders can count on up to $300 in statement credits toward travel booked through Capital One Travel each year and other valuable benefits like access to Priority Pass lounges and Capital One’s own growing family of airport lounges.

Pros

  • Excellent welcome offer worth 75,000 miles after you spend $4,000 on purchases in the first three months.
  • Up to $300 in annual travel statement credits toward bookings make through Capital One Travel.
  • 10,000 bonus miles (worth $100 toward travel) each account anniversary.

Cons

  • The $395 annual fee might be expensive for some, but this card’s benefits provide much more value than that.
  • If you don’t travel frequently, this might not be the best card for you.
  • Earn 75,000 bonus miles when you spend $4,000 on purchases in the first 3 months from account opening, equal to $750 in travel
  • Receive up to $300 back annually as statement credits for bookings through Capital One Travel, where you'll get Capital One's best prices on thousands of options
  • Get 10,000 bonus miles (equal to $100 towards travel) every year, starting on your first anniversary
  • Earn unlimited 10X miles on hotels and rental cars booked through Capital One Travel and 5X miles on flights booked through Capital One Travel
  • Earn unlimited 2X miles on all other purchases
  • Unlimited complimentary access for you and two guests to 1,400+ lounges, including Capital One Lounges and our Partner Lounge Network
  • Receive up to a $100 credit for Global Entry or TSA PreCheck®
  • Use your Venture X miles to easily cover travel expenses, including flights, hotels, rental cars and more—you can even transfer your miles to your choice of 15+ travel loyalty programs
  • Named editors' choice for "Best New Credit Card of 2021" by The Points Guy
  • Earn 10 miles per dollar when you book on Turo, the world's largest car sharing marketplace, through May 16, 2023
Best card for premium perks while traveling
TPG Editor‘s Rating
Card Rating is based on the opinion of TPG‘s editors and is not influenced by the card issuer.
4 / 5
Go to review

Rewards Rate

10XEarn unlimited 10X miles on hotels and rental cars booked through Capital One Travel
5X5X miles on flights booked through Capital One Travel.
2X2 Miles per dollar on every purchase, every day
  • Intro Offer
    Earn 75,000 bonus miles when you spend $4,000 on purchases in the first 3 months from account opening, equal to $750 in travel

    75,000 bonus miles
  • Annual Fee

    $395
  • Recommended Credit
    Credit ranges are a variation of FICO© Score 8, one of many types of credit scores lenders may use when considering your credit card application.

    740-850
    Excellent

Why We Chose It

The Capital One Venture X card is one of the best all-round travel credit cards ever launched. Not only is it offering a tremendous welcome bonus, but cardholders can earn tons of miles on everyday spending and receive a 10,000-mile anniversary bonus to boot. Its annual fee is $395, but cardholders can count on up to $300 in statement credits toward travel booked through Capital One Travel each year and other valuable benefits like access to Priority Pass lounges and Capital One’s own growing family of airport lounges.

Pros

  • Excellent welcome offer worth 75,000 miles after you spend $4,000 on purchases in the first three months.
  • Up to $300 in annual travel statement credits toward bookings make through Capital One Travel.
  • 10,000 bonus miles (worth $100 toward travel) each account anniversary.

Cons

  • The $395 annual fee might be expensive for some, but this card’s benefits provide much more value than that.
  • If you don’t travel frequently, this might not be the best card for you.
  • Earn 75,000 bonus miles when you spend $4,000 on purchases in the first 3 months from account opening, equal to $750 in travel
  • Receive up to $300 back annually as statement credits for bookings through Capital One Travel, where you'll get Capital One's best prices on thousands of options
  • Get 10,000 bonus miles (equal to $100 towards travel) every year, starting on your first anniversary
  • Earn unlimited 10X miles on hotels and rental cars booked through Capital One Travel and 5X miles on flights booked through Capital One Travel
  • Earn unlimited 2X miles on all other purchases
  • Unlimited complimentary access for you and two guests to 1,400+ lounges, including Capital One Lounges and our Partner Lounge Network
  • Receive up to a $100 credit for Global Entry or TSA PreCheck®
  • Use your Venture X miles to easily cover travel expenses, including flights, hotels, rental cars and more—you can even transfer your miles to your choice of 15+ travel loyalty programs
  • Named editors' choice for "Best New Credit Card of 2021" by The Points Guy
  • Earn 10 miles per dollar when you book on Turo, the world's largest car sharing marketplace, through May 16, 2023