50% of major credit cards have pivoted their rewards strategy to accelerate point earning for food delivery purchases since the beginning of the COVID-19 pandemic.
NEW ORLEANS, Oct. 22, 2020 /PRNewswire-PRWeb/ -- 50% of major credit cards have pivoted their rewards strategy to accelerate point earning for food delivery purchases since the beginning of the COVID-19 pandemic, according to a new whitepaper by PaymentsSource and iSeatz. The whitepaper - Banking Rewards & Dining: A Changing Landscape - details both sea changes in consumer spending and the resultant strategic shifts brands such as Mastercard, Citi, Capital One, and US Bank are making to leverage these new behaviors.
"Travel earning and redemption has always been the gold standard of rewards products, however coronavirus has made it clear that a travel-only portfolio cannot sustain a card's presence at the top-of-wallet during a pandemic," said iSeatz CEO Kenneth Purcell. While usage of rewards points for travel has been gradually recovering, usage of loyalty-integrated food delivery has soared more than 100%. "Consumers are looking for ways to use their points that are convenient, safe, and provide everyday value."
- Food delivery in the US is a $26B industry
- 70% of Americans order takeout or food delivery
- 10% use a food delivery app more than once per week
The food delivery industry is expected to grow more than 20% in 2020, driven largely by lockdowns and concerns about the safety of in-person dining. Although Americans are returning to restaurants, usage of food delivery apps, and increased order frequency, is expected to remain post-pandemic. 60% of Americans now say they order takeout at least once per week, and orders of loyalty-integrated food delivery still remain nearly 35% above average despite more than 80% of restaurants being open for dine-in.
Additionally, the report dives into the trends driving dining-related rewards over the past five years, which kicked off with Capital One's launch of the Savor card, specifically targeting high-spending foodies. Since then, major issuers have been in an arms race to deliver the most food-related bang for the cardholder buck. Chase partnered with Tock, and just last week announced enhancements to their partnership. Amex acquired reservation platform Resy in 2019. And since March other cards have, at a bare minimum, increased the earn acceleration for food purchases.
iSeatz launched point redemption for food delivery in early October, based on the belief that cardholders are craving new ways to use points that don't require travel, and that simply amping up point-earn for dining-related spend won't be enough for brands to maintain deep connections with their customers. iSeatz has powered point earning food delivery solutions for both IHG and Wyndham Hotels since spring 2019. The redemption solution will be the first of its kind and is now available for loyalty programs of any size, offering access to food at more than 150,000 restaurants, purchasable with loyalty currency. This will be the first of several new integrations aimed at brands who are looking for ways to engage their highest value loyalty members with non-travel offerings.