You may have seen television commercials for Chase's Blueprint program (most depict someone planning to buy a big-ticket item such as a couch or an engagement ring with a Chase credit card to the tune of the Sting song "Brand New Day"). Blueprint is a set of features offered on 20 million Chase cards that are intended to help customers manage their spending and borrowing; it's included in the Freedom, Slate, Sapphire and Ink card programs.But although Chase clearly has an enviable advertising budget for Blueprint, which launched in September, this is more than just a marketing campaign. The features have been programmed into core card processing and statement generation programs at a heavy cost in development time: 300,000 hours of in-house programmers' time over 15 months in the reconstruction of customer billing and payment processing systems to deliver revised account calculations and statements. The process included designing and building new systems, quality control testing and implementation of all system changes, and adjusting the systems to comply with new laws and regulations for credit cards. "It was a two-year development process of rearchitecting our systems, our statements, the way we calculate monthly payments so that customers can have flexibility," says Caryn Kaiser, senior vice president and general manager at JP Morgan Chase, who oversees Blueprint and discussed it in a recent interview with Bank Systems & Technology. "It was a huge undertaking."
There are four features of Blueprint: Full Pay, wherein customers decide which expenses they want to pay in full every month and thus avoid paying interest on those items; Split, which lets customers select a number of payments or monthly payment amount on large purchases such as home improvement projects or a new appliance; Finish It, which helps customers create a plan to pay down their current balance faster, working toward a goal date; and Track It, which gives customers a snapshot of all of their Chase card purchases, tracked by category. All the features have been popular, but Kaiser says the Split feature has obtained the highest levels of customer satisfaction, in the high 90s. "People see and feel a sense of progress, they're building plans for things like Ikea furniture, a vacation to Grandma's, Joey's braces, and paying them off," she notes.
While the recently enacted Card Act requires card issuers to inform customers how long it will take them to pay off their balance at their current rate of repayment, Blueprint provides a way of managing that and of reinforcing that progress has been made.
Affluent, high-net-worth customers have shown an affinity for Track It, the feature that categorizes spending. "You see high spenders wanting a quick way to look at where their dollars are going," Kaiser says.
Blueprint arose out of consumer research that showed that the average American has six to eight credit cards and often sets aside cards for specific purposes - one might be conserved only for emergency purchases such as new car tires, another might be for everyday expenses and the goal might be to avoid paying interest. Chase tried to build some of these behaviors into a card program.
The bank's profitability model for Blueprint is based on customer retention. "The model is about generating a long-term, engaged customer, so it's not about a fee or a short-term transactional relationship, it's about creating something that's of such value to the everyday life of a customer in their everyday spend that we'll generate complete loyalty," Kaiser says. "And when we generate that loyalty, the profitability of reducing attrition is huge. It's very expensive to generate a new customer or try to constantly engage or re-engage customers with promotions."
One area of future development for the Blueprint program is mobile. Chase is considering setting up text alerts about spending; for instance, if a TrackIt user doesn't want to spend more than $200 a month on dining, then the bank would send them an alert when they come close to that $200 mark. Chase is continuing its customer research to enhance the existing Blueprint features and add new ones.