Co-branding has entered its late adolescence and is now a fixture of American marketing and the global payments industry. According to Co-Branded and Affinity Credit Cards in the U.S., a new report from market research publisher Packaged Facts, by the end of 2006 roughly 30-60 million U.S. consumers carried over 320 million co-branded and affinity credit cards, up from Packaged Facts estimate of 212 million in 2003.

Consumers used co-branded and affinity cards in at least 9.4 billion transactions worth at least $849 billion. With over three-quarters of U.S. adults (pretty much the entire credit worthy adult population) owning at least one credit and debit card, co-branded and affinity card marketers are seeking to fashion programs to attract new or under-penetrated consumer segments. Card industry professionals are taking fresh looks at ethnic groups and the affluent on the one hand, as well as the non-affluent and unbanked consumer. In most segments, including airlines and hotels, the big customer lists have been thoroughly mined, leaving little room for further penetration.

"There are literally thousands of co-branded and affinity card programs on offer and some sectors are thoroughly saturated," notes Don Montuori, the publisher of Packaged Facts. "Yet most of the experts believe that co-branding still has strong growth potential. Co-branded debit cards, for example, are just in their infancy, and it's not uncommon to see debit issuers cross selling other products, making the value of the co-branded card all the more important."