KB Kookmin Card’s “Tantan Daero Easy Home Card” is a specialized automatic payment credit card for apartment maintenance fees and communication expenses, which can save users around 60,000 won per month.
The card offers various benefits including a 10 percent discount when it is used automatically to pay for daily living expense billed monthly, such as apartment maintenance, phone, power and gas bills. In case of phone bills, if the previous month’s bill amounts to 400,000 won, the discount will amount to 10,000 won, if the bill comes to more than 800,000 won, the discount offered would be around 20,000 won and if the bill amounts more than 1.5 million won, the discount would be around 30,000 won.
The discounts will be offered on bills issued by SK-Tel, KT and LG U+ for the uses of phones, mobile communication and internet-related facilities that are paid automatically with the credit card.
If the payments made with the card in the preceding month comes to around 400,000 or more, a discount of 80 won per liter will be offered to cardholders refueling at both SK and GS Caltex service stations across Korea.
If the card is used to pay for something bought at such large marts as E-Mart, Lotte and HomePlus, a 5 percent discount will be offered for payments amounting to 5,000 won per payment.
If the card is used to buy admission tickets at Everland, cardholders can have a 50 percent discount for one admission ticket and 10 tickets per year in total. For those who use the card at Lotte World, a 50 percent discount will be applied for the first admission ticket, and up to five tickets per year. For Caribbean Bay, a 30 percent discount will be allowed for one ticket. For the Max Movie, a 3,500 won discount will be offered for two tickets per day.
An annual fee of 15,000 won will be applied to KB Kookmin’s “Tantan Daero Easy Card,” while an annual fee of 9,000 won will be billed for smart phone users instead of the card.
KB Kookmin Card enjoyed a 700 billion won ($600 million) year-on-year revenue boost in 2016, which is partly attributed to its new digital marketing strategy.
Park Jae-hoon, head of big-data strategy at the card company, said the firm’s platform, powered by technology integration vendor Tibco, has given KB Kookmin Card a multi-year leap ahead of its major competitors in Korea.
Intense competition in Korea’s credit-card industry has saddled the industry with a no-growth situation. The market is saturated, with 80 percent of family expenditures now paid by cards. The average Korean holds multiple cards, and uses them for increasingly small transactions: 42 percent of card use goes to purchases below $9, Park says. Yet there are 22 card companies in Korea, and they are in a constant state of trying to innovate or differentiate. Advances tend to be short-lived; within a few years, everyone will have copied the best ideas.
Park’s team was looking for a way to raise the bar high enough that it would take the likes of Hyundai Card and Samsung Card much longer to catch up. It has done so by adopting a marketing strategy based on real-time data, personalization and better analytics.
The traditional marketing strategy was to email or text customers selected from the company’s database about a campaign, but these were generic messages and eventually people came to see it as spam.
KB Kookmin Card worked with California-based Tibco starting in 2013 to overhaul how it engages with customers. It first introduced a marketing platform using real-time marketing tools to identify specific people who might want a particular offer, based on their other buying or online behavior, Park says. Big-data tools scoured customer data to create more personalized offerings.
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