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According to some estimates, nearly half the credit cards in the United States are cobranded cards -- those in which a retailer or service provider teams with a credit card issuer to allow customers to accumulate points toward rewards when they make purchases using the card.

But there are limitations. Most cobranded cards aren’t terribly flexible; many only allow customers to accumulate points toward one thing, such as airline trips or free hotel stays. And often it takes months or years to accrue enough points to get something of value.

Furthermore, the cost of marketing the cards and paying out rewards has largely locked smaller retailers out of the cobranding movement.

ePlate, a new card developed by Dynamics, offers greater flexibility for consumers when it comes to redemption and for smaller retailers that previously could not afford to offer a cobranded card. Dynamics is currently working with more than 40 different retail brands.

“On Monday, you can collect airline miles,” explains Jeff Mullen, CEO of Dynamics. “On Tuesday, collect hotel points and on Wednesday get a hot video game.”

Customer acquisition
Customers use their mobile phone or visit a website that allows them to select which reward programs they want to participate in. Each program is assigned a number; when customers make a purchase with the card, they push a button on the card that’s connected to the selected reward program’s number. The device’s battery is good for some four years of use, according to the company.

Many of the retailers working with Dynamics are electronic content providers; customers selecting those programs can get rewards immediately -- a free game, for example, or a free book or song. As part of the program, participating retailers get 25 basis points on each transaction associated with the rewards program, providing the funding to pay for the rewards.

“We’ve had some rewards up to 100 percent where customers who spend $1 get $1 off on their next purchase,” Mullen says. Customers like the fact that they can choose to get instant rewards or save up for something of greater value, he adds.

Dynamics also provides retailers with purchase data made on the card, allowing them to analyze the information and personalize rewards. “Retailers find this to be a great customer acquisition tool,” Mullen says, “as they can get their product promoted without a lot of cost.”

The card’s magnetic stripe works with existing systems so retailers accepting it do not need to make changes to their POS systems. Retailers should not even notice that the ePlate card is any different from traditional cards, Mullen says, and it can adapt to changing technologies. “This card is technology agnostic,” he says. “We can put in contactless interchange and it can be used as an EMV or mag-stripe card.”

Innovative products, innovative rewards
Trading card and memorabilia company Upper Deck uses ePlate to promote its cards, sold at a large variety of retail stores as well as via its own website. Chris Carlin, sports marketing and social media manager for Upper Deck, liked the fact that ePlate was a high-tech option.

“We offer innovative products to the market and we liked the idea of partnering with an innovative company that had a different way for customers to pay for products and get rewards,” he says.

Customers using Upper Deck rewards can designate their favorite sport, choosing from basketball, hockey, soccer, football or golf. After they have made the designated number of purchases, they receive free decks of trading cards from that sport.

“We offer a fun way to trade cards,” Carlin says, “and this is a fun way to collect rewards online.”

Upper Deck considered traditional rewards programs but wanted something “more technology-driven. We thought ePlate had a better synergy with what we were doing,” he says.

Upper Deck began the program with Dynamics in late 2011. While Carlin says it is too early to assess whether the program is successful at getting customers to buy more trading cards from Upper Deck and its associated retailers, he is optimistic.

“There seems to be a lot of good buzz associated with this program,” he says. “People are enjoying it. We’re excited to see how it will grow within the next year.”