Home > Credit Cards > Companies Developing “Social” Credit Cards

Comments 0 Comments

[Disclosure: Our partners are mentioned below.]

As consumers become more reliant on social media every day, many companies are looking for ways to incentivize use of credit cards in conjunction with this purchasing method.

Businesses such as LivingSocial – the world’s second-largest daily deal social couponing service – and American Express are now working independently to encourage more use of their products by offering consumers more incentive to get involved.

For LivingSocial’s part, it is introducing a credit card that aims to encourage consumers to frequent the same businesses over and over again in an effort to earn special rewards, according to a report from Reuters. The card, which will be issued by Chase and carry the Visa brand, will be offered to all of LivingSocial’s users in the U.S.

The reason shoppers who frequently use the program to make purchases will be incentivized to adopt the program is that those who make 10 purchases with the credit card in a given month will receive 10 “Deal Bucks,” which are credits issued by LivingSocial, the report said. These Deal Bucks can then be put toward future LivingSocial daily deals and other offers, including discounted travel arrangements. The upside for merchants to encourage use of the program, at least initially, is that they will receive a small amount of funding from the social couponing company.

“We will use this as a platform to encourage people to come back to merchants,” LivingSocial chief financial officer John Bax told the news agency. “Small and medium-sized local businesses will never be able tohave their own credit card or loyalty program. We will be able to bring them the benefits of that.”

Meanwhile, American Express recently announced plans to launch its own daily deals service in what it called an effort to turn America into a “couponless nation,” according to a report from Daily Finance. The program encourages users to sync their AmEx credit cards with their Twitter accounts, then use special hashtags in their tweets that will automatically link their account with special deals offered by a number of business partners, including Best Buy, H&M, Ticketmaster, Whole Foods Markets and more.

[Credit Cards: Research and compare credit cards at Credit.com.]

Businesses are now looking for a larger number of ways to incentivize credit card use, as consumers may still be somewhat cautious in returning to this type of purchasing in the wake of the recent recession.

Image: orphanjones, via Flickr

Comments on articles and responses to those comments are not provided or commissioned by a bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by a bank advertiser. It is not a bank advertiser's responsibility to ensure all posts and/or questions are answered.

Please note that our comments are moderated, so it may take a little time before you see them on the page. Thanks for your patience.

Certain credit cards and other financial products mentioned in this and other sponsored content on Credit.com are Partners with Credit.com. Credit.com receives compensation if our users apply for and ultimately sign up for any financial products or cards offered.

Hello, Reader!

Thanks for checking out Credit.com. We hope you find the site and the journalism we produce useful. We wanted to take some time to tell you a bit about ourselves.

Our People

The Credit.com editorial team is staffed by a team of editors and reporters, each with many years of financial reporting experience. We’ve worked for places like the New York Times, American Banker, Frontline, TheStreet.com, Business Insider, ABC News, NBC News, CNBC and many others. We also employ a few freelancers and more than 50 contributors (these are typically subject matter experts from the worlds of finance, academia, politics, business and elsewhere).

Our Reporting

We take great pains to ensure that the articles, video and graphics you see on Credit.com are thoroughly reported and fact-checked. Each story is read by two separate editors, and we adhere to the highest editorial standards. We’re not perfect, however, and if you see something that you think is wrong, please email us at editorial team [at] credit [dot] com,

The Credit.com editorial team is committed to providing our readers and viewers with sound, well-reported and understandable information designed to inform and empower. We won’t tell you what to do. We will, however, do our best to explain the consequences of various actions, thereby arming you with the information you need to make decisions that are in your best interests. We also write about things relating to money and finance we think are interesting and want to share.

In addition to appearing on Credit.com, our articles are syndicated to dozens of other news sites. We have more than 100 partners, including MSN, ABC News, CBS News, Yahoo, Marketwatch, Scripps, Money Magazine and many others. This network operates similarly to the Associated Press or Reuters, except we focus almost exclusively on issues relating to personal finance. These are not advertorial or paid placements, rather we provide these articles to our partners in most cases for free. These relationships create more awareness of Credit.com in general and they result in more traffic to us as well.

Our Business Model

Credit.com’s journalism is largely supported by an e-commerce business model. Rather than rely on revenue from display ad impressions, Credit.com maintains a financial marketplace separate from its editorial pages. When someone navigates to those pages, and applies for a credit card, for example, Credit.com will get paid what is essentially a finder’s fee if that person ends up getting the card. That doesn’t mean, however, that our editorial decisions are informed by the products available in our marketplace. The editorial team chooses what to write about and how to write about it independently of the decisions and priorities of the business side of the company. In fact, we maintain a strict and important firewall between the editorial and business departments. Our mission as journalists is to serve the reader, not the advertiser. In that sense, we are no different from any other news organization that is supported by ad revenue.

Visitors to Credit.com are also able to register for a free Credit.com account, which gives them access to a tool called The Credit Report Card. This tool provides users with two free credit scores and a breakdown of the information in their Experian credit report, updated twice monthly. Again, this tool is entirely free, and we mention that frequently in our articles, because we think that it’s a good thing for users to have access to data like this. Separate from its educational value, there is also a business angle to the Credit Report Card. Registered users can be matched with products and services for which they are most likely to qualify. In other words, if you register and you find that your credit is less than stellar, Credit.com won’t recommend a high-end platinum credit card that requires an excellent credit score You’d likely get rejected, and that’s no good for you or Credit.com. You’d be no closer to getting a product you need, there’d be a wasted inquiry on your credit report, and Credit.com wouldn’t get paid. These are essentially what are commonly referred to as "targeted ads" in the world of the Internet. Despite all of this, however, even if you never apply for any product, the Credit Report Card will remain free, and none of this will impact how the editorial team reports on credit and credit scores.

Your Stories

Lastly, much of what we do is informed by our own experiences as well as the experiences of our readers. We want to tell your stories if you’re interested in sharing them. Please email us at story ideas [at] credit [dot] com with ideas or visit us on Facebook or Twitter.

Thanks for stopping by.

- The Credit.com Editorial Team