Driving Growth Through Partnershipsabout Obama’s innovative use of social networking to raise money, and predicted that ... US Credit Card Usage Rises for First Time since August

Driving Growth Through Partnerships

Stephen F. Eulie, President First Bankcard

Celebrating over 150 years

First National Bank


Six generations of family leadership

First National Bank



Largest privately owned bank in U.S.

First National Bank




A top 15 U.S. credit card issuer

First National Bank




A top 15 U.S. credit card issuer

Creating credit card partnership solutions since 1968

First National Bank

Top 5 Historically BAD predictions

5. “It will be gone by June.”Variety, passing judgment on rock 'n roll in 1955.

4. “A rocket will never be able to leave the Earth’s atmosphere.”

New York Times, 1936.

3. “The horse is here to stay but the automobile is only a novelty – a fad.”

The president of the Michigan Savings Bank advising Henry Ford’s lawyer, Horace Rackham, not to invest in the Ford Motor Co., 1903

2. “I think there is a world market for maybe five computers.”

Thomas J. Watson, 1943, Chairman of the Board of IBM

And the number one historically BAD Prediction?

1.The End of the Credit CardWidely reported

“The End of Credit Cards is coming”

CNNMoney.comJanuary 24, 2011

The End of Credit Cards? Feb 20th, 2009 | By Anet Dunne |

Marc Andreessen, inventor of the web browser, was interviewed on PBS yesterday. He spoke about Obama’s innovative use of social networking to raise money, and predicted that insolvent banks would be replaced with new, online banks like BillMeLater.com,

http://anetgain.com/author/admin/

http://www.charlierose.com/view/interview/10093

https://www.billmelater.com/about/index.xhtml

PAY BILLS WITH SMARTPHONE

The End of Credit Cards?

A CNN story reports that by 2015 nearly everyone will pay with their smartphone instead of a credit card...but we recommend going with debit.

Womens Health Magazine, March 2011

The End of the Credit Card ConsumerismA new frugality could remake the U.S. economy—and American life US News.com, August 8, 2008

The reports of my death have been greatly exaggerated . . .

Mark Twain

Credit Card continues to play an important role in global commerce.

U.S Credit Card Usage is On the Rise for the first time since Aug 2008

US Credit Card Usage Rises for First Time since August 2008”. 8 Feb. 2011. International Business Times. Retrieved from: http://www.ibtimes.com/articles/110100/20110208/credit-card-consumer-borrowing-consumer-credit.htm

Consumer spend migration to e-pay continues

Cards and

Other Network

30.2%

Checks52.4%

Cash 17.4%

Cards and Other

Networks 52.6%

Checks 26.9%

Cash20.5%

Sources: Global Insight, BEA, Nilson

New Account DM Solicitations (by Quarter since 2007)

0

0.5

1

1.5

2

2.5

Q107 Q207 Q307 Q407 Q108 Q208 Q308 Q408 Q109 Q209 Q309 Q409 Q110 Q210 Q310 Q410

# of

Off

ers

Mai

led

(Bill

ions

)

Source: Comperemedia

Credit Card Average Spend per Household at a 20-year high

Source: Synovate Mail Monitor


– On average, households with credit cards are spending $1,559, a 6% increase compared to 2009.



– On average, households with credit cards are spending $1,559, a 6% increase compared to 2009.

– Average spend is on a continual rise, reaching $1,627 for Q2 2010.


Consumers are increasingly demanding rewards for credit card spending.

Argus Information & Advisory ServicesCredit Card Payments Study, October 2010

Industry Distribution of New Cards

Cobrand Rewards 40.6%Non-Cobrand Rewards 28.3%Non Rewards 31.1%


Argus Information & Advisory ServicesCredit Card Payments Study, October 2010

Industry Distribution of New Cards

Cobrand Rewards 40.6%Non-Cobrand Rewards 28.3%Non Rewards 31.1%


Cardholders use several cards to earn the most value for their spending:

1 2 3 4 5+26% 30% 18% 10% 16%

Total Number of Cards Held

Cardbeat Consumer Research & AnalysisU.S. Edition, volume 16 issue 2


1 2 3 4 5+26% 30% 18% 10% 16%

Almost half of cardholders use three or more credit cards

Total Number of Cards Held



Top Three Statements of agreement among rewards cardholders:


1.I prefer a lot of options to redeem my rewards for



2.My credit card company makes it easy to redeem rewards




2.My credit card company makes it easy to redeem rewards

3.I am satisfied with my credit card company’s process to redeem rewards.



What drives spend on First Bankcard partner programs?


unique rewards,


offer unique rewards,service that strengthens customer

loyalty to the partner’s brand,


offer unique rewards, service that strengthens customer

loyalty to the partner’s brand,a simple, intuitive design.

– World of Warcraft® - largest online subscription game

– 12+ million subscribers; $20/month to play– Average player online 20 hours per week

Case in Point

Our “quest”: Developing a unique experience for customers leveraging strengths of both partners

Stop looking for a “magic bullet”

Work with our partner to find the magic sword

– Three prongs of success*• Value to Customer• Value to Partner• Value to First Bankcard

* Three prongs of success may be sharp - handle with care

The Customer Lifecyclea.k.a – “The Circle of Life”

Players pay monthly

subscription with card

Players earn points on

transaction

Players earn more points on

everyday purchases

Players redeem points for game time

Happy customers keep playing game, charging monthly subscription fee with their card – And the Circle of Life

continues

“The Card That Pays You to Play”

– Highly integrated customer experience

– Card design evolves as game evolves to keep product fresh and customers excited

Unique Rewards

0% APR? Interesting…I’m remodeling my bathroom!

This shouldn’t take long…

All right!FREE shipping!$129.20 rewards!

Chrysler Group:Strengthening Customer Loyalty

Customers asked for …

A card that rewards their loyalty.

• Low rate, no annual fee

Chrysler MasterCard with Maximum Rewards

We have designed …

• Points redeemable for:new and pre-owned carsservice and parts travel,cash & gift cards

• Instant redemption at dealer

A seamless application process through the F&I office

Dealers asked for …



Decision in seconds

An integrated process:

6 easy steps

Minimal actions needed by dealer personnel


An instant solution for the Service Department

Dealers asked for …

A custom application with:

Access through Service Department


Decision in seconds

Instant redemption at check out

Giving Bank Customers An Edge

Giving Bank Customers An EdgeStrengthening Customer Loyalty

Helping to approve credit



Addressing gaps



Addressing gaps

Rewarding patronage


Relationship Underwriting



Overdraft Protection



Overdraft Protection

Choice of Rewards


Lending Centers

Internet

Branch

Direct Mail

Call Center

Union Bank:Strengthening Customer Loyalty

Murphy Oil:Intuitive Design

First Bankcard & Murphy USA marry technology, business possibilities, and customer demand


First Bankcard & Murphy USA marry technology, business possibilities, and customer demandInstant price reduction creates seamless customer experience


First Bankcard & Murphy USA marry technology, business possibilities, and customer demandInstant price reduction creates seamless customer experience$0.04 price reduction creates seamless customer experience and instant gratification


FBC and Murphy USA marry technology, business possibilities, and customer demandInstant price reduction creates seamless customer experience$0.04 price reduction creates seamless customer experience and instant gratification


Scheels All Sports:Intuitive Design

Congratulations!

Credit Limit: $10,000

Instant Credit Instant Value Instant Purchasing Power - Everywhere

http://www.scheelssports.com/webapp/wcs/stores/servlet/ProductDisplay?langId=-1&storeId=10001&catalogId=10101&productId=74313&categoryId=109155

http://www.scheelssports.com/webapp/wcs/stores/servlet/ScheelsGiftCardsView?catalogId=10001&storeId=10001&partNumber=GCBundle&langId=-1&backCmd=ProductDisplay&cm_sp=SCHEELS-_-GIFTCARDS-_-NA&cm_re=HOMEPAGE-_-HEADER-_-GIFTCARDS-HEADER

Final thoughts:

Card usage continues to grow, and cards can be the cornerstone of a great loyalty program.

Final thoughts:


The program should be customized to the partners unique business model

Final thoughts:



The program must have a strong connection to the brand

Final thoughts:




Function should be straightforward and intuitive

Final thoughts:




Function should be straightforward and intuitive

Program development is an iterative process

Final thoughts:

Our mission:

Building partnerships that are just that …Partnerships

Documents

Driving Growth Through Partnershipsabout Obama’s innovative use of social networking to raise money, and predicted that ... US Credit Card Usage Rises for First Time since August