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Consumers have flocked to Target’s new Redcard offer, which was rolled out nationwide in October, according to a report from the Minneapolis Pioneer Press. The card has attracted many creditworthy consumers to shop more frequently at the major national retailer, and their purchasing increases 44 percent over previous habits upon its activation .
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“This is the heart of what makes the economics of the program work so well: a huge lift in sales at the household level, all driven by shopping frequency,” Doug Scovanner, Target’s chief financial officer, said at a recent retail conference, according to the newspaper. “This is very clearly a program that has multiyear legs, and we’re very, very excited about where this will ultimately go.”
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In addition, Target expects to activate about 3.5 times more Redcard accounts during 2011 than it did in the previous year, the report said. In addition, testing of this program found spending on Redcard accounts increased slightly on a year-over-year basis.
Many consumers have turned to store-issued credit cards in recent months, particularly if they have had trouble qualifying for other lines of credit in the past. Typically, these accounts are easier to qualify for.
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