pgw Ltd. independent customer & business-to-business loyalty marketing specialists

home / articles

The registered trademark of pgw Ltd.

Garanti Bank

"Loyalty is not a technological program; it's about capturing the mind and heart of the consumer"

Q. Which loyalty program based in Europe has a combined membership of retailer merchants as large as Nectar in the UK and Loyalty Partner 'payback' in Germany, has been established longer and has developed a very sophisticated and thoughtful loyalty scheme?

A. The Garanti Bank BonusCard Program (web site:

The Garanti Bank in Turkey has created a loyalty program that it believes is ready to build on a local success and take the product into other countries. Colloquy first featured this program a few years ago, but we decided it was timely to revisit the management and understand how the program has developed and what brand extension (both nationally and internationally) they see possible in the next few years.

We interviewed Asli Germen, the VP of communications in Garanti Payment Systems, a 99.6% owned subsidiary of Garanti Bank in Turkey, to understand more about this impressively large customer loyalty program that does not yet attract the attention it deserves from anyone with an interest in successful, banking card customer loyalty applications.

Some background on Turkey

The country is still much underbanked, with 77% of the population holding a relationship with a bank, versus comparable figures for the UK and France of 99%. However, Turkey is the third largest card market in Europe with approximately 40 million debit cards and 27 million credit cards in circulation.

The population base of 70 million is projected to reach 79 million by 2015 and 50% are below the age of 35. The Turkish economy is expanding fast with average annual change in GDP tracking at 3.8% and total GDP of around $200 billion USD. Historically, the rate of inflation has been high but the Turkish government has effectively managed this down to a figure very close to the EU average and negotiations have now begun with the EU over possible Turkish membership within a generation. This historic high inflation has also left a legacy of the huge attraction for cardholders to be able to pay in instalment with retailers who accept the card. This market characteristic has been woven into the design of the Garanti program and reflects their 'marketing driven', rather than 'technology driven', approach to development.

The creative success of the program has been a contributor to Garanti Bank moving from the number 4 market share in 2000 to number 2 in 2002. They have built a marketing expertise internally that offers a bridge between merchants, retailers and Garanti as the acquiring Bank.

The interview

We spoke with Asli Germen, Senior VP Communications at Garanti Payment Systems.

What is your background and how did you become Senior VP Communications at Garanti Payment Systems and then involved with the Bonus Card program?

"I graduated from Université de Louis Pasteur in Strasbourg France, with a major in Economics and Business Administration. After working for two years as a dealer in a Turkish bank, I have decided to change my career plans and moved into the world of communications. I have worked in advertising, brand design, PR, TV station, event management, and even in a UN conference organization, before coming back to the financial world, this time combining my skills in communication with my knowledge in finance. The environment of payment systems carries the vivacity of marketing, the creativity of communications and the dynamics of economics altogether. It is indeed very exciting and challenging."

This is an innovative program and breaks new ground in terms of the number of partner merchants (1,000+) and over 70,000 sales points. How did it start?

"Bonus Card program has today 3.6 million cardholders, more then 1,000 partner merchants with their 70,000 point of sales. It has witnessed a steep growth in the first 2 years and a steady expansion since then. Garanti has licensed the Bonus program to another local bank, Denizbank. Together, the total number of Bonus Credit cards in the market is 4.1 million.

"It all started with a very simple idea and a strong vision shown by the management. There were store card and co-branded card efforts in the market with no real success. Banks were proposing gift catalogues to redeem credit card points, but only with 6-7% redemption rates. Retailers were in need of a loyalty program and there was no real differentiation amongst the credit cards.

"The idea was to establish a win-win-win situation for the bank, retailers and customers. The product also had to be extremely user-friendly, simple, motivating, gratifying and fun. We launched the card with the slogan of "the card that makes you earn each time you spend". The cash back system was effectively communicated and as you could redeem your bonuses at any partner merchant, at any time and at any amount, the simplicity encouraged the cardholders to prefer Bonus Card.

"Our major partner YKM, Turkey's biggest department store chain, converted its store card users to Bonus Card, giving immediately a strong start-up point to the program. The presence of strong retailers such as Shell, Tansas Supermarket at the launch gave a well-built basis and a relevant partner merchant network where cardholders could redeem their bonuses."

The Turkish market in terms of credit card loyalty schemes is very crowded; how do you create interest and space in the member wallet?

"In fact, Bonus Card program was copied only 16 months after its launch. This time was enough for Garanti to double its market share and then triple within first 3 years. Being the innovator allowed Bonus Card to be the first or second card in member wallet. Of course, with the ongoing growth of the market on one hand and the increasing competition in the market on the other, Garanti continues to focus both on card sales and volume increasing campaigns with partner merchants.

"We work very closely with our major partner merchants in order to convey our cardholders to their shops and their customer's preferences to our card. We have a large team of account executives who use our CRM and merchant analysis tools in order to create effective and innovative campaign ideas for their partner merchants. Our partner merchants also have access to a highly structured CRM website,, where they can have direct access to customer analysis in terms of demographics, loyalty, spending habits, volumes, store activations, bonus redemptions and all sorts of graphics to help modelling their campaigns."

How many members does the program have?

"Bonus Card program has 1,000 partner merchants with their 70,000 sales point and 3.6 million cardholders."

How many are active users in terms of using the card at least once in the last month?

"We are quite proud of our results in the area of activity rate. The industry definition for activity rate is at least one transaction within last 3 months. Bonus Card general activity rate is at 78%. The upgrade versions of Bonus Card that cardholders can attain by staying loyal, Bonus Plus (cardholder earns 50% more bonuses at non-partner merchants) and Bonus Premium (100% more bonuses), witness a higher activity rate, consecutively 87% and 92%."

Do you view any similar schemes in Turkey as a threat or challenge?

"Any good competition is a challenge to make things better, more effectively, creatively, and thus leads to better product and service offers and higher customer satisfaction."

This was a recurrent theme throughput my interview with Asli. She and the rest of her team are constantly seeking ways to use their marketing expertise and experience gained from the program to create a better CVP (customer value proposition) and merchant/retailer value within the program. They are not satisfied to rest upon the current success of the program, but are continually looking for new ways to improve and evolve the scheme.

How important is it to facilitate further earning opportunities in the program?

"We believe that building around the concept of earning bonuses is a simple but effective tool of marketing. Not only have we based many campaigns on offering more bonuses, but we also link many banking products and services to Bonus reward program. This creates a synergy between the bank's products and increases customer profitability."

Do you see the potential to extend the brand into other consumer product areas?

"We have already realized some line extensions, but staying in the same product category, the cards. We introduced a debit card for youngsters between the ages of 12-18, called G-Bank Bonus Kontör. This product is part of the bank's youth banking package. We launched a similar product for sub-prime target group, called Bonus Kontör, in order to convert credit card applicants whose applications are denied to debit card, thus bank customers. We also recently introduced Turkey's first translucent and mc2 (MasterCard's 3 corner card design) Bonus Unibank, for university students, within the Banks university bank package. The debit and ATM card of the bank, Para Card, also carries Bonus Card symbols, as it offers them the opportunity to earn bonuses whilst retail shopping. Bonus Card has introduced in 2005 the business card version. Virtual Bonus Card and Bonus Gift cards are also in the market for many years. In brief, we are always seeking new and better ways to develop the program for our cardholder membership and partners."

Do you see potential to extend the program into other European or Middle East markets?

"We provided consultancy to many banks and financial institutions in Europe, Middle East, Australia and participated at several conferences as speakers. We are now willing to license the program and would be proud to see it achieve similar success and extremely high financial results in other countries. We have a dedicated team who can not only realize the necessary know-how transfer, but can also assist in marketing strategies and applications."

Do you operate an incentive to convert store cards to the program?

"The quality of the data that stores can provide is unfortunately not always sufficient for conversion. Our partner stores saw the benefit of converting their store card customers to Bonus Card, as it not only increases the activity rate of the card but also the satisfaction level of the customer. We usually do not offer an incentive for store data, unless meaningful cooperation is foreseen, as we believe in permission-based marketing. But we offer some incentives or organize special incentive campaigns for the applications that derive from merchant's sales points."

How do you see technology such as the growth of MMS and SMS marketing impacting on your member dialogue?

"SMS marketing is an effective and economical communication tool, but needs to be carefully managed as it can easily get out of control and create spam. This is why we segment each offer and campaign, and send SMS according to a time plan."

Do you plan to modify your rewards structure to make it more customized to member interests?

"There is already an option for the cardholder to choose either to earn more bonuses and pay in one payment term, or choose to earn fewer bonuses but pay the transaction in several instalments. Because of past high inflation years the country experienced, instalments is an important sales tool for retailers. The Bonus program enabled retailers to offer instalments to their customers, while transferring the risk to the bank. As the innovator of payment systems in Turkey, we are continually exploring new reward and financial structure ideas."

What, if you faced launching the program again in Turkey, would you do differently in the overall scope of the scheme?

"The product offer would definitely be the same as it has proven to be a sustainable success. The advertising strategy also proved to work well and Bonus Card's TV advertisements are usually the favourite of consumers. Looking back, I think we could however have tried to keep the partner merchant network more restricted. If partner merchants could be exclusive to Bonus program (this is not possible legally in Turkey), this could have had a positive effect on managing loyalty, but then the program would offer less variety for bonus redemption. In brief, we would keep the great majority of the scheme as is."

Is the technical platform supporting the program operated in-house and do you utilize any outsourced service providers in the management of the customer database and analysis?

"The technology platform of Bonus Card has been successfully developed in-house by Garanti Technology. All customer database and analysis are performed in house.

We have a dedicated team of 32 persons working in the customer insight group and our aim is to be continually innovating pro-active and targeted offers for our clients."


A key part of the success of the program has been the ability of the team at Garanti Payment Systems to persuade the merchants involved in the program of the importance of their marketing and customer insights. They offer services from consulting to simple program and process implementations through to full blown setting up of the complete Garanti scheme. Their aspirations to extend the reach of this expertise into other markets, especially into Central European banking environments, is entirely feasible and they have already commenced discussions in some markets.

The number of credit cards programs globally offering some form of customer loyalty benefit has been estimated at around 50% and this trend is likely to have added impetus in Europe where consumers have historically been less attracted to this form of everyday credit. Banks, when they have created these programs, have often led with a technical platform focus that has weakened the customer value proposition. The team at Garanti has built their success around understanding the marketing first and delivering the technology later. This should support their ambitions to grow the base of customers outside the Turkish home market. It will also add greater credence to the ambitions of Turkish leaders to develop greater economic ties to the EU.

To contact Asli about the program, email her at

This article was facilitated by and assistance in the interview was provided by Yalcin Yilmaz (email: from the CRM Institute based in Istanbul (web site: We are grateful to Yalcin for his support in organising the interview and his continued friendship.

Peter G Wray

The author is managing director of pgw Ltd. This article was first published in Colloquy magazine, Autumn 2005.

Copyright © 2000 pgw Ltd. All rights reserved. The pgw logo is a registered trademark of pgw Ltd. "" is a trademark of pgw Ltd.