With its new credit card, Apple is counting on younger consumers to value convenience and privacy over generous cash rewards.
The so-called Apple card differs in many ways from conventional credit cards. It does not include a credit card number, expiration date, or CVV security code that protects against theft. In addition, Apple Pay's Face and Touch ID security features are built into the card. Apple executives who announced the card this week are also demanding no late fees and lower interest rates.
To use the card, which will be available this summer, consumers will be able to use their iPhone's Apple Wallet app. The card is intended as a payment method for Apple Pay in physical stores, online or in apps. The card will also have a physical Titan version. Apple was partnered with Goldman Sachs on the map.
Jeff Fromm, author of "Marketing to Gen Z" and partner of the Barkley agency, gave a positive verdict on the transparency and smooth experiences that are all associated with a phone. The Apple brand will increase its value. "Gen Z is" hashtag "that Apple loves this card," he says.
But the card's cash bonuses miss what traditional cars offer. For example, users earn 3% Cash Back on all Apple product purchases and only 2% on Apple Pay. According to PC magazine, Citibank and Fidelity offer similar returns of two percent, but without the Apple Pay rule. "The offer of Apple Pay is spreading, but is by no means omnipresent," said PC Magazine. "How much cash back you earn depends on how fast Apple is conquering the mobile payment market and how often you think about unpacking your cell phone instead of putting your credit card in the cash register."
Yet, younger customers, especially those who belong to the coveted Gen Z community will be seduced by the functionality of the map. The card keeps track of purchases and provides monthly and weekly spend snapshots and trend reports in one place in the Apple Wallet app. Consumers can also use a card feature to find out where an item was purchased if they did not remember to complete the purchase.
"Although the rewards of the Apple Card are not too exciting, it could add value to customers' existing loyalty in terms of comfort and security," said Jill Gonzalez, an analyst at WalletHub's financial hub. "When the card is used through Apple Pay, users can quickly see where and how they spend their money without using a third-party app."
Gen Z, the mid-1
Despite the fact that many consumers are not enthusiastic about money, Gen Z is heavily involved with their finances, according to Paul Savaiano, director of the advertising agency Walrus strategy.
"They tend to adopt a different tool if it helps them to feel unfair with a cool new tool that encourages them to feel comfortable with money, but helps them achieve their financial goals, "he says. "But as Gen Z values the practicality, independence, and change in other aspects of their lives, Apple Card may be perceived as something that makes them feel" good about their finances and about the lives they live on. "
However, there are some skeptics. Andreas Ruggie, Executive Strategy Director at Red Peak Group, a branding agency, points out that the credit card market is already saturated. He adds, "It may feel fresh that Goldman Sachs has never had a consumer-friendly product and therefore is" open to doing things in a new way ", but it doubts that this brand name will make a clear distinction with adult generations Record holds with the recession, for which she was partially responsible. "
Goldman paid $ 5.1 billion in 2016 for a mortgage-backed securities lawsuit in 2007, but the brand has had new generations in recent years courted. Two years ago, the bank launched a new consumer-owned online bank called Marcus, named after Goldman Sachs founder Marcus Goldman, targeting younger customers.
"Introducing our consumer brand Marcus offers simple and transparent options for consumers and customers Excellent customer service gives us the opportunity to reintroduce Goldman back into this generation," says a spokesperson.
Other credit card companies are already seeking some of the benefits of the Apple Card, such as privacy. Craig Vosburg, president of North America for MasterCard, partner of the card, told Bloomberg News that the Apple Card may encourage other banks to change their card number strategies and security measures.
Some social media users joked With regard to the "innovation" of a credit card, most consumers seemed to welcome the new product. Here are some of the social media responses.
"It's as if McDonald's started selling yogurt and salads, stay in your lane." – Howard Stern on Apple's credit card and Apple TV and news bundles.
– Joe Flint (@JBFlint) March 26, 2019
Apple: We start a card with which you can pay something.
All: credit cards have been around since 1950.
Apple Cult: pic.twitter.com/w43gIfzX8N
– Sam Kalidi (@samkalidi) March 25, 2019
– Funabridged March 25, 2019
– Mark Caruso (@Mr_Cso) March 26, 2019
Me: * pays off my CC debt *
Apple: hey wants new credit card
– Belly Bundy (@DopeChubbyChick) March 26, 2019