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Discover wants your friends

By Janna Herron · Bankrate.com
Tuesday, August 30, 2011
Posted: 4 pm ET

Here's another example of a credit card company taking to social media networking.

Discover is rewarding current cardholders with $50 cash back, or 5,000 miles, for referring their friends and family through Facebook, Twitter and email. Simply log on to your account online, share the offer via those three methods and get the reward once a friend or family member is approved for a card.

Your friend or family member also gets a bonus $50 cash-back reward if they make a purchase within three months.

There are limitations. Current Discover cardholders don't count as referrals. Duh. The promotion only runs until Sept. 10. And the uber-friended or super-followed ones among us can sign up no more than 100 people. Still, that's quite a haul of $5,000, or 500,000 miles.

Discover will alert you by email each time you earn rewards. Expect to wait five weeks for your cash-back rewards or miles to post to your account after each referral is approved.

Social media and mobile promotions and partnerships have heated up in the last year and a half as card issuers seek new ways to communicate with and market to customers, says Nicole Sturgill, research director of delivery channels for TowerGroup.

This summer alone has seen Citi partner with Best Buy for an app that instantly applies rewards points to purchases at the electronics retailer. American Express unveiled a program with Foursquare that offers its cardholders mobile discounts redeemable by smartphone. It also teamed up with Facebook to offer daily deals based on a customer's likes, interests and social connections.

"At first, financial institutions were just watching because they didn't want to get into it without knowing how to get out of it," says Sturgill. "Now, they are seeing these successes and it got them thinking, 'We should do that.'"

A recent study from Synergistics Research showed that a quarter of people are a "fan," "friend" or "follower" of a credit card company or brand on social networking sites. Of those, one of three reported they started the cyber relationship to get promotions or deals, while half wanted to learn more about or share their experiences with the company or brand.

Are getting social with your credit card company?

Follow me on Twitter: @JannaHerron

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