Lands' End announced last week that it's introducing a Visa credit card to incentivize shoppers with loyalty rewards, according to a company press release.
Cardholders will receive free standard shipping on online Lands' End credit card purchases, 50% off their first Lands' End credit card purchase on the day they open the account and five reward points per $1 spent on the retailer's website or store during their birthday month, per the release. Shoppers will also earn two points for every dollar spent at gas stations, restaurants or travel-related purchases and one point for non-Lands' End purchases.
To launch the credit card, the retailer partnered with Alliance Data, which manages more than 160 co-branded credit card programs.
Lands' End isn't the only retailer looking to revamp its loyalty program with a branded credit card. Retailers and brands like Lucky Brand, Sephora, Amazon, Stein Mart and Walmart have issued their own credit cards. Mike Holahan, Lands' End senior vice president of marketing, said the initiative is meant to enhance the company's customer service with an easier way for customers to shop and save money in-store and online.
"[W]e're confident the program will help drive long-term loyalty and engagement with our brand," Holahan said in a statement.
But, will consumers enjoy these new store credit cards? Previous research indicates they might not. Though a 2018 CompareCards.com report found that 74% of Americans possess a store credit card, 47% of them regretted having them. The report also found that these cards had unusually high annual percentage rates compared to non-store cards and questionable terms hidden within the fine print. Debt conscious millennial shoppers may be less interested in credit cards in general thanks to the Great Recession.
However, launching store credit cards isn't a strategy without merit for retailers. After all, almost a third of Americans applied for store credit cards during last year's holiday season, another CompareCards.com report found. Despite their debt apprehension, millennials were the largest demographic to apply for store credit cards in the previous holiday season, but they were also the most likely to be rejected, per the report.