Skip to main content
Updated:
Original:

Can 3 little words convince millennials to use this credit card?

The new card is made with this generation in mind

There are more millennials than any other generation in the U.S. Millennials are also known in the financial world for avoiding credit cards

This combination presents a challenge for a credit card company like American Express. Their new plan to meet that challenge involves three words: no annual fee. 

American Express and Delta Air Lines are rolling out a new card Thursday and they say it's designed for people in the 18-34 age group. 

'Built for the new traveler'

American Express and Delta have already teamed up on other frequent flyer credit cards – where using the card adds miles to your frequent flyer account. 

But unlike the gold, platinum, and reserve cards, the new blue one is meant for people who don't travel very much – at least not yet.

"We purposefully built this card with the new or casual traveler in mind," Sandeep Dube, a Delta vice president, says in the companies' statement. No annual fee is a big part of that strategy, plus the frequent flyer miles don't expire.

Dube also tells Bloomberg the idea is that Blue card users will transition to the other ones as they move through life. 

As a starter card, the Blue one will not get you all of the perks the fancier ones offer. Your bag fee doesn't get waived, for example, and you don't get priority boarding or use of the private lounge. 

Millennials and credit cards 

A study commissioned by Bankrate a couple years ago found that 63 percent of millennials do not have a credit card. And in most cases it's by choice. 

Why? For one thing, lots of millennials are already working on paying off student loans. 

But beyond that, it seems to be a generation that doesn't want to take on debt, Bankrate suggests. That's consistent with what Facebook found when they surveyed millennials last year about their attitudes toward money. 

Forty-six percent said their definition of financial success includes being debt free. Some financial experts have theorized that coming of age during a recession contributed to a distaste for debt. 

New card targets restaurant meals

American Express and Delta were, of course, well aware of the millennial aversion to credit cards. So they did some research to try to figure out how to break through it. 

Getting rid of the annual fee is certainly part of that. But their researchers also found that more than a third of millennials said eating at restaurants is the No. 1 way they spend disposable income. 

And 82 percent of those in the 18-34 age group told American Express and Delta that when they travel they especially want to try new dining experiences. 

So to encourage millennials to pay for those meals with their new Blue credit card, the companies will give cardholders two frequent flyer miles for every dollar spent at a U.S. restaurant. That doubles the one-mile-for-one-dollar that applies to other purchases.

Next Up

Dalvin Cook

Report: Dalvin Cook has dislocated shoulder, will undergo MRI

The Vikings running back was carted off the field in Sunday's loss to the 49ers.

Kirk Cousins

Watch: Kirk Cousins lines up under guard on critical 4th down play

Kirk Cousins went "Full Kirk" at the worst possible time.

Dalvin Cook

Dalvin Cook injured, Vikings drop crucial game against 49ers

The Vikings couldn't stop the Niners' rushing attack in a 34-26 loss.

Flickr - police lights squad siren - Edward Kimmel

Man airlifted to a hospital after police shooting in Forest Lake

Police allege that the man presented a threat to officers.

Minnesota Wild

Wild's two third-period goals take down the Lightning

Ryan Hartman's go-ahead goal defeated the two-time defending champions.

Byron Buxton

Reports: Twins reach extension with Byron Buxton

The long-term deal locks in one of the Twins' franchise players.

Justin Jefferson

Vikings-49ers: 5 things you can count on

Sunday's matchup is a pivotal game in the NFC playoff picture.

Gopher Football

Watch: Gophers troll Badgers with 'Jump Around' after Saturday's win

First they took Paul Bunyan's Axe. Then they took their tradition.

Brandon Richart, missing person

Search underway for missing man in Anoka area

Brandon Richart was last seen Nov. 17.

U.S. Bank Stadium

5 teams win first state championships at Prep Bowl

A pair of records fell as the Prep Bowl lived up to the hype.

Related

The Tip Jar: Are air miles credit cards worth it?

And are they better than frequent flyer miles?

The Tip Jar: The best cash back credit cards out there

If you're spending, you might as well get something back for it.

Which food stands accept credit cards at the Minnesota State Fair?

Many food and drink stands don't take cards – but some do.

Which food stands accept credit cards at the Minnesota State Fair?

Many food and drink stands don't take cards – but some do.

Uber launches a credit card that's actually pretty good

But would you trust the company with your spending data too?

GameStop investigates possible credit card security breach

If you've shopped at GameStop.com in the last 7 months, keep an eye on your credit card bills.

Police: food court eatery skimmed credit cards

Roseville police are investigating what they believe to be an identity theft and credit-card skimming operation at the Chinese Gourmet Express restaurant in the Rosedale Center mall. Losses are estimated at $100,000.