"Maine woman gets $1m check from L.L. Bean
L.L. Bean and Barclaycard US are awarding $1 million to a customer as part of the Maine-based retailer’s centennial celebration. Chris McCormick, L.L. Bean’s chief executive, said the L.L. Bean Visa Centennial Sweepstakes was a fun way to celebrate the company’s 100th anniversary. The winner is Marjorie Thompson of Cumberland, who used her L.L. Bean Visa to make a purchase at the Kimball Shop in Northeast Harbor, Maine. Officials expressed surprise that the winner was from Maine, given that there were 220 million entries. All told, there were 250 winners from 38 states. Gifts included camping gear, outdoors discovery school packages, and $500 gift cards."
Better start charging those L.L. Bean products to your card:
"Bank of America spars with L.L. Bean over credit card; When affinity becomes acrimony, card users lost" by Todd Wallack | Globe Staff, March 24, 2013
Enid Gamer had long used her L.L. Bean credit card to qualify for coupons, free shipping on returns, and other perks from the New England outdoors retailer.
So the Milton psychologist thought nothing of it when she received a new credit card in the mail this month, just as her old L.L. Bean card was about to expire. Just like her old card, the new one contained a scenic photo of a mountain range.
But when she took the new card to the Dedham store to return a cashmere sweater and other clothing, she received an unpleasant surprise. The store clerk pointed out it wasn’t an L.L. Bean credit card after all. It was from Bank of America — the financial giant that used to mint L.L. Bean cards until the store switched to a different bank.
“The clerk said that it happens all the time,” Gamer said. “In my opinion, it is misrepresenting the card.”
Gamer got a rare peek into what happens when relationships sour in the affinity credit card business — where credit card companies team up with merchants, universities, associations, and other groups to aggressively market the cards to members and customers.
When business is good, both sides can benefit handsomely. Card issuers gain access to a new pool of customers and organizations receive a steady stream of revenue in exchange for that access, typically a bounty for each new customer plus a small percentage of the transactions customers ring up on the cards. But when partners divorce, it can spread confusion as both sides battle for custody of the customers.
The split between Bank of America and L.L. Bean appears to have been particularly acrimonious....
L.L. Bean ended the agreement in June 2008 and tapped British financial giant Barclays to take over the business. Bank of America, however, decided to keep the old L.L. Bean branded card accounts open. And when those cards were about to expire, Bank of America issued replacement cards with a mountain scene similar to the one on L.L. Bean cards.
The Charlotte, N.C.-based bank even used the image of a hiker on a mountain top carrying sporting goods gear in related promotional material.
That's a bit deceptive, isn't it?
L.L. Bean was so aggrieved that it filed a lawsuit in federal court accusing the bank of deliberately trying to deceive customers. Bank of America denied the allegations, including the suggestion that L.L. Bean had exclusive rights to “mountains or mountain scenes.”
In 2009, a judge declined to order Bank of America to cancel the old L.L. Bean cards, ruling there was “room for reasonable minds to differ” over the meaning of the contract. Both companies ultimately agreed to take the matter to arbitration.
Neither Bank of America nor L.L. Bean would say how the arbitrator ruled....
Doug Furbush, who helped pioneer the affinity credit card business three decades ago as a vice president of Trans National Group Services in Boston, said over the past few years Bank of America has tried to cut back on smaller and less profitable partnerships, replacing thousands of affinity credit cards with its own generic bank cards. Many customers will likely keep the new cards, Furbush said, either because they want the credit or think it’s too much of a hassle to switch. Bank of America will no longer have to make royalty payments to the partners.
“Bank of America is trying to squeeze the grapefruit,” Furbush said.
The bank said it continues to maintain affinity relationships with key partners, including the Boston Red Sox, PGA Tour, and Alaska Airlines. In a recent conference call with analysts, Bank of America chief executive Brian Moynihan said the affinity business remains “very core” to its credit card business.
Still, the affinity business is no longer as hot as it once was. The recession and increased regulations drove many banks to be pickier about extending credit, while many consumers cut back on borrowing....
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