Rakuten Visa To Be Replaced with 2% Synch Premier WMC

[wasCB14]

Does anyone here have a deep understanding of shopping portal economics?

Is the bonus usually paid by the retailer? By some third party that wants customer data?

I can understand some jeweler or florist paying a big referral fee to an airline or credit card company that brings in a customer. They have high gross margins and their products can be unique enough that customers won't necessarily go for the cheapest competitor. And the customer may not be aware of the retailer, or think of the retailer before making a purchase. But if retailers X Y and Z all sell the same thing at the same price, and all are major retailers many customers would think to check, then why should X bother with a portal?

Is it about having effectively a two-tiered pricing system...one price for people who want a discount, one for everyone else? Why doesn't X just sell a product for 1% less than Y and Z?

[notmyrealname23]

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@KK44 wrote:

Thanks for the explanation.

The next question to prepare for the end, does Syncrony let you move credit lines around. Is it likely or not that calling them would allow for a move of the credit line from the Rakuten card to another sync card like the PayPal MC or eBay card to combine the lines?

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Don't think so, couldn't move my Cathay Pacific CL to any other Sync card when I closed it.

(Pours a 40 out for the Rakuten card)

[longtimelurker]

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@wasCB14 wrote:

Does anyone here have a deep understanding of shopping portal economics?

Is the bonus usually paid by the retailer? By some third party that wants customer data?

I can understand some jeweler or florist paying a big referral fee to an airline or credit card company that brings in a customer. They have high gross margins and their products can be unique enough that customers won't necessarily go for the cheapest competitor. And the customer may not be aware of the retailer, or think of the retailer before making a purchase. But if retailers X Y and Z all sell the same thing at the same price, and all are major retailers many customers would think to check, then why should X bother with a portal?

Is it about having effectively a two-tiered pricing system...one price for people who want a discount, one for everyone else? Why doesn't X just sell a product for 1% less than Y and Z?

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According to what I have read, the rewards are paid by the retailer (they give a commission to the portal, who gives a portion back to the customer).   And of course the choice isn't portal or no portal, it's also which portal(s).   

My guess is that retailers know that a growing number of people are using them (or might use them) and so if they are not represented on at least some, they could be losing some customer share.  There has been some mainstream attention to the portals, e.g. TIME How to Maximize Credit Card Rewards with Online Shopping Portals | NextAdvisor with TIME  , CNBC How To Pay For Your Amazon Black Friday Deals (cnbc.com) and Forbes How to Maximize Online Shopping Portals (forbes.com)

[K-in-Boston]

Just chiming in that I received email from both Synchrony and Rakuten in the past hour.   😭 

Another factor on portals is that they can strongly influence which retailer a consumer will purchase from, and I freely admit that it has influenced my decisions for years.  If the same item is the same price at two or more retailers, I'll typically choose the one that provides the most rewards.  It's also encouraged me to make purchases I otherwise would not have made; an example of this might be signing up for wine delivery services (sigh, yes plural) when combining lucrative Amex Offers with huge amounts of rewards back, like spend $100 but get $75 statement credit and 4000 points in rewards from Rakuten, which is essentially paying $25 for 8 bottles of wine and about $80 in Membership Rewards.  🍷 = ✈️ 

[Taurus22]

Sounds like another SyncB curse. They are good at disappointing people.

Sorry to hear about the Rakuten card though.....sounds like it worked well for many of you for different reasons.

[longtimelurker]

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@Taurus22 wrote:

Sounds like another SyncB curse. They are good at disappointing people.

Sorry to hear about the Rakuten card though.....sounds like it worked well for many of you for different reasons.

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While Sync has issues, I think this was more a case of "too good to be true cards don't last"   The ability to earn MRs on this Visa card was exceptional.  Too exceptional!

[K-in-Boston]

Credit card partnerships end at times, always a possibility with any lender, and they don't always result in a transfer to a new lender (Virgin America card post-Alaskan merger comes to mind as one I almost picked up immediately before).  This doesn't seem to be an issue with Synchrony, just that they mutually agreed to end the partnership.   Rakuten's parent company has banking ventures as well, so it's not unimaginable they may try to strike out on their own if they don't find another partner.

[CaptinVantage]

I could be reading my letter from synchrony wrong but nothing in my letter says the card will be closed . It also doesn't say it will transfer to something else but the only thing it says is you can no longer use it . Which makes me think they are leaving it open to be converted for some on a case by case basis . In the end I could be wrong but banks and corporations are usually very specific on wording . This was left open for interpretation. Just a thought.  

[longtimelurker]

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@CaptinVantage wrote:

I could be reading my letter from synchrony wrong but nothing in my letter says the card will be closed . It also doesn't say it will transfer to something else but the only thing it says is you can no longer use it . Which makes me think they are leaving it open to be converted for some on a case by case basis . In the end I could be wrong but banks and corporations are usually very specific on wording . This was left open for interpretation. Just a thought.  

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Maybe, but the default after "you can no longer use it" is that that is it (i.e. account closed, no new card).   You could equally say that if there was the possibility of transfer that would be indicated.   Given what CSRs were told earlier in the thread, I am fairly certain that the account will just close.

[CaptinVantage]

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@longtimelurker wrote:

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@CaptinVantage wrote:

I could be reading my letter from synchrony wrong but nothing in my letter says the card will be closed . It also doesn't say it will transfer to something else but the only thing it says is you can no longer use it . Which makes me think they are leaving it open to be converted for some on a case by case basis . In the end I could be wrong but banks and corporations are usually very specific on wording . This was left open for interpretation. Just a thought.  

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Maybe, but the default after "you can no longer use it" is that that is it (i.e. account closed, no new card).   You could equally say that if there was the possibility of transfer that would be indicated.   Given what CSRs were told earlier in the thread, I am fairly certain that the account will just close.

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I agree , I said it doesn't say it will transfer . It doesn't actually say what will happen besides you can no longer use it. That's my point it's very vague . With the gap card , the message said if your card does not transfer to Barclay it will be closed . Not you can no longer use it . When comenity ended the Wayfair the notice said the Wayfair program will be ending . Some closed some got sent MasterCards . Hopefully they clarify it . Right now it's open for assumptions and speculating. Hopefully they turn them in to 2% premier mastercards . But time will tell .