Magazine article American Banker

First USA Turns to Merchants to Help Retain Baby Boomers

Magazine article American Banker

First USA Turns to Merchants to Help Retain Baby Boomers

Article excerpt

First USA plans to use partnerships with well-known merchants to hang on to its market share among baby boomers, who are outgrowing the tendency to carry balances, according to the executive in charge of such partnerships.

"The boomer generation is moving out of borrowing and into spending," said Tom Kerwin, the executive vice president of relationships marketing at First USA, of Wilmington, Del.

He estimated that around 76 million Americans were born between the end of World War II and the early 1960s. "They have accumulated great wealth," he said. "Rewards products like what we do through cobranding has a great appeal for that set of people."

The Bank One Corp. subsidiary this month announced a deal to issue the BJ's MasterCard in partnership with BJ's Wholesale Club Inc., which operates 131 members-only warehouse stores in 16 eastern states. First USA now has around 50 cobranding deals, according to Mr. Kerwin.

He said he expected the card to be popular, not so much because it is unique, but because BJ's members are loyal to the stores.

"I don't think are so different," he said. "You are already getting a good deal" shopping there.

The retailer has collected e-mail addresses from many of its customers, and First USA will use that list to conduct marketing campaigns, Mr. Kerwin said.

BJ's MasterCard cardholders will earn a reward of up to 1.5% of the price of their purchases. The reward is delivered in the form of "BJ's Bucks," which can be redeemed for purchases in the stores. …

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