An analysis of main and subsidiary credit card holding and spending

This study seeks to examine why most multiple credit cardholders have a “main” card (i.e. a card used more often than others) and “subsidiary” cards (i.e. cards used less often or only in an emergency) and the spending patterns associated with main and subsidiary cards.

The study is qualitative in nature, using a survey which contained open‐ended questions to acquire data. Responses were subject to content analysis to categorise the reasons given for having a main and subsidiary card.

Results show that some 85 per cent of the 141 respondents indicated that they had a main card and the most frequently quoted reason for having such a card was the superior discounts and promotions which were offered by the card issuer. Not surprisingly, main cards were used for the broadest range of transactions, while subsidiary cards were used for a more restricted range of transactions, a majority saying that their subsidiary cards were held for “stand‐by purposes”.

The primary limitation of this study is that the generalizability of the findings cannot be guaranteed. Although there is no particular evidence that Singaporeans behave differently from others in the credit card market, replication of the findings in other countries would confirm the generalizability of the findings in this study.

The results suggest that managers who market credit cards should aim to ensure that, at all times, the discounts they offer, the promotions they arrange and their loyalty schemes are superior to those offered by competitors. By meeting these aims, higher numbers of consumers, who are multiple cardholders, are likely to use their card as a main card, thereby generating more income for their credit card issuer.

The study provides an original insight into an important element of consumer behaviour in the credit card market and also offers guidance for marketing managers responsible for enhancing credit card ownership and usage.