Skip to main content
Retail Intelligence

Bad Credit

By November 27, 2023No Comments

According to the Wall Street Journal, Black Friday sales were strong but retailers are noticing that getting customers to use store-branded credit cards is a hard sell.

The article states…

“Income from Target’s credit-card business declined 10% in the most recent quarter, compared with the same period a year earlier. At Kohl’s, other revenue, which includes credit cards, was down 6%. Macy’s credit-card revenue dropped 31%.”

Why should this be a surprise?

Interest rates on these cards are close to 30%. The incentives to get customers to sign up for these cards are weak. “Buy Now, Pay Later” programs are agnostic to the retailer and no lengthy sign-up process is needed.

These types of credit cards are best viewed as relics of the past. Gone are the days of the allure of the department store credit cards.

There are better ways to drive revenue from customers. May we suggest, a profitable product assortment?