Hate to say it, but I know several people who follow this logic. I happen to have a Macy's account (with a $0 balance), but it allows them to mail me "exclusive coupons" and catalogues with all their latest promotions...

...which can only be good for business.

care of Captain Obvious, CFP.

The special sales are usually pretty modest (say, an extra 10% on one day a month) and can be easily trumped by looking on FatWallet or SlickDeals, etc.

Correlation does not equal causation. I think it's just as likely that customers who shop regularly at a particular store are more likely to get a store branded credit card.

I hated having to get customers signed up for these kind of cards. I refused to do it. I think the four months that I worked at a department store I only signed up two people. It's a total fraud.

I think fellow commenter B is closer to the truth than the retail sales clerk.

My parents have multiple store cards (Macys, JCPenneys, PC Richards and what have you). However, they rarely shop at those places, even with the endless coupons that are sent to us through the mail. Same with some of my other relatives and with some of my friends.

I personally promised not to create all those stores cards unless I really want to take advantage of some good financing deals. If anything, the lack those cards help keep my credit file relatively manageable (fewer cards to account for).

Maybe this would be true for me if Kohls would actually send me their %-off cards in the mail again. I haven't seen one in over five months.

Kohls? Are you listening? You have a male shopper here who actually buys new articles of clothing each year!

Here's what I always tell those people that say "You can save XXX dollars today." I say, "Actually I'm in the process of buying a house and if I allow you to pull my credit report to give me a card, it will push up my mortgage rate and cost me about $20,000 over the life of my mortgage." Of course it's not true but at least they're less pushy.

"They tell us..."

Who's "they?" The corporate brainwashing works on employees just as well as customers it seems. I have two store-branded cards, and I never use either of them, nor do I shop at the stores any more often than I did before getting the cards. The cards were one time things, used for zero-interest financing.

As a college student I work part time at Old Navy. Each week on my schedule I have a number of credit cards written on the bottom that I'm supposed to fulfill. That haunting number located right next to my days off. BLAH. I hate credit cards, I hate hassling people to sign up for them. Do I want a credit card with a 23% rate? NO. Do they? Probably not. Not to mention the town this Old Navy is in is rather small. Therefore everyone and their brother who live there probably already have one.. so at some point it's going to get close to impossible to keep signing people up except for tourists.

I do not believe this.

I sign up for store branded cards and get the 10% discount and then I never shop there again.

I think this is the case that those who like shopping at the store get the store branded card as B has said.

or do people who spend more get the cards because of the rewards?

@r081984: Agreed. In fact I am on hold as I type this trying to cancel my Haverty's card after saving several hundred dollars using one of their promotions :)

Wow! I guess that means that without the store credit card, I'd only shop at B. Moss once every SIX years!

(B. Moss = my favorite women's clothing store, the only store credit card I have, but I'm so lazy about shopping I just never, ever go, and my card's always been purged from the system when I try to use it.)

I think having a store branded credit card, and going, through the approval process, allows the store to become part of your identity. I have a Barney's card, and as a "Barney's guy," I feel out of place at Saks or Neiman's.

Hmm. It seems a little odd that the quote seems to attribute the increased sales (if they exist) to the fact of the customer just having the physical card, and not to the customer receiving coupons or discounts because they have the card. I got a Macy's card because I shop there a lot, and I probably buy a bit more stuff there than I would without the card, but it's because of the coupons and also because a lot of the stuff I decide to buy has an additional discount if you use your Macy's card.

Honestly, I'm not that bothered by getting asked if I want a store credit card, it's easy enough to say "No thanks" (although it always feels odd when they just say "Would you like to save [X] today?" and I say no, since of course I WOULD if I didn't have to get a new credit card to do it).

I don't see anything wrong for SALES associates to sell store brand credit cards. If they didn't want to do it in the first place, maybe they shouldn't get a job in sales. Most store brand card holders are loyal to the company and do end up spending more money at the store than bank card holders. It's only logical for the company to want to keep customers coming back and buying more. It's working capitalism. That's how they stay in business. The customer can just politely decline if they don't want the card. Performance reviews for the sales associate include credit apps, plus sales and service. And they are told that this part of the job when they interview. Plus the sales associate is financially compensated for every card they open. It's simply part of the job.

@beboptheflop: I know whenever I apply for a credit card, someone from the credit card company always calls me up trying to get me to buy specific items of clothing and housewares. And I am so pleased to get these calls, because I have no other convenient ways of obtaining clothing or housewares, and don't feel like wasting time comparison shopping for items that better meet my needs.

And this is news.........how?

They used to tell us this when I worked at Fry's Electronics some time back. Getting the customer to sign up for a Fry's Credit card was more important then even the actual transaction. The normal APR was 24.99% if I remember right, perhaps that's why they hounded us to get these cards. The most amazing part, however, was that there was always some chum that got ridicoulously excited when they were offered a "free" credit card.

Theres a TON of advantages for retailers to have their own cards.

One: no use charges for the retailers, visa takes a cut whenever you use the card at a store. if its a store branded card, the company doesnt take that hit.

two, the aforementioned interest.

three, if the customer has a higher spending limit, it can lead to bigger purchases.