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Alliance Data, DSW Collaborate

Zacks Equity Research

Alliance Data Systems Corporation (ADS), which provides data-driven marketing and loyalty solutions, has announced a long-term agreement between its Retail Services business and DSW Inc. (DSW) to provide co-brand credit card services to the latter.

Columbus-based DSW Inc., encompassing a wide variety of brands, offers designer footwear and accessories for men, women and children. The company delivers its shopping services through 400 DSW shoe warehouses and stores across 43 states, Puerto Rico and District of Columbia, and an e-commerce site. The company reported $2.4 billion of sales for 2013.

Per the agreement, Alliance Data will design marketing-driven credit card program services that will reward DSW customers based on their transaction amount. While these programs add value for the consumers, the company benefits to gain from enhanced customer loyalty and higher spending.

Customers, on spending, can earn DSW certificates through the DSW Rewards program and enjoy facilities like future redemptions, easy exchanges and special member-only offers. DSW Rewards is an award winning loyalty program with 22 million of active members.

At present, the Retail Services business of Alliance Data manages more than 130 private label and co-brand credit programs. At the end of last month, this business unit of Alliance Data signed a long-term agreement with leading women's fashion online and catalog retailer, Venus to provide private-label credit card services to the latter.

Earlier in February, the Alliance Data’s Retail Services business inked a long-term renewal agreement to continue providing both private-label and co-brand credit card services for customers of lifestyle and entertainment retailer, HSN.

Zacks Rank

Alliance Data presently carries a Zacks Rank #2 (Buy). Some other top-ranked stocks worth mentioning in the business services sector are JTH Holding, Inc. (TAX) and Global Payments Inc. (GPN). While JTH Holding sports a Zacks Rank #1 (Strong Buy), Global Payments carries a Zacks Rank #2.

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