Biz Buzz: Too successful

 | Wednesday, November 16th, 2011

The local unit of British banking giant HSBC recently fell victim to its own wildly popular promo where it tied up with Cathay Pacific to provide credit card clients with free tickets on the airline based on the cardholders’ purchases.

Under the promo, cardholders had to present single-purchase receipts of at least P10,000 each, five of which would qualify him or her to a free roundtrip ticket to Hong Kong (10 charge slips of P10,000 each to get a ticket to regional destinations, and 15 such charge slips for a ticket to any Cathay destination around the world).

The promo was an instant hit. What the bank did not count on, apparently, was for its relatively more affluent cardholder base to pull off all sorts of tricks—often in cahoots with retailers—to come up with as many charge slips as possible.

Reports were rife of people buying thousands of liters of gasoline in one go (ostensibly for their companies’ vehicle fleets) and putting the tab on their credit cards, with the fuel retailer agreeing to chop up the purchase into P10,000 receipts, of course.

There were also reports of clients going to casinos and buying hundreds of thousands of pesos worth of chips (charged to the credit card), and then redeeming the chips for cash just a couple of hours later (again, just for the charge slips).

The “abuses” were so rampant that HSBC was forced to revise its rules to prevent the use of casino purchases and multiple purchases from one merchant on the same day.

According to our sources, the bank had to end the promo prematurely after they realized that its original cost-benefit analysis had changed dramatically. On the last day of the redemption for the promo, the line of cardholders snaked outside the Cathay Pacific office in Makati. Surprise, surprise: most of the people in line were the well-heeled—or their drivers, yayas and secretaries—leaving many HSBC executives shaking their heads in disbelief.—Daxim L. Lucas

Leave a Reply

Please log in using one of these methods to post your comment: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s

%d bloggers like this: