Giving a discount on goods as a reward for opening up a credit account is not exactly a new trick by retailers.  That is what Target Corp. (NYSE: TGT) is offering up.  It’s a gimmick.  Target’s website for opening the card for 10% OFF DAY WITH NEW CREDIT ACCOUNT….  The company notes, “Open a Target credit card and we’ll immediately mail your certificate good for a 10% off day at Target and a 10% off an entire purchase at Target.com.

There are of course rules.Earn a 10% off shopping day at Target just for opening a Target Business Card® account…

When you use your new Target Business Card, the New Account Discount is valid for an entire day of 10% savings at any Target store and for 10% off an entire purchase at Target.com (before it expires). 10% in-store savings do not apply to cardholders residing in Kansas City and San Antonio areas. Cardholders in the Kansas City and San Antonio areas should see their local store for more information on their rewards program.

In-Store
10% savings at Target stores cannot be combined with other total transaction discounts and does not apply to purchases of GiftCards, purchases at Target.com, purchases at Target Commercial Interiors®; Target credit account payments, prescription drugs purchased in AR, LA, MA, NJ, NY or prescriptions paid for by any insurance plan funded in whole or in part by the federal government or by ConnPace Insurance in CT; or where otherwise prohibited by law. Certificate may not apply to some partner businesses.

Online
Discount not applicable to GiftCards, e-GiftCards, gift wrap, tax, or shipping and handling charges. Offer available for Target.com orders only and applies to only one shipping destination. May not be combined with other promotional codes or applied to previous orders. Offer does not apply to partner businesses, personalized gifts, Peg Perego, Bose, Tivoli and Sennheiser electronics or Amazon.com product purchases. 10% off valid through the offer’s expiration date.

As far as rates…. Target Credit: Variable rate, 13.25%, 17.25% or 22.90%, based on your credit- worthiness.  This APR will vary with the market based on the Prime Rate.

If you pay your bills in full at the end of the month, this is a way to save a little if you are willing to spend a lot.  If you are like most of the public and just pay bills off either with a minimum or pay them off slowly but surely through time, this 10% savings is hardly a real savings at all.  They’ll get their 10% back by collecting interest, particularly if you are late on paying bills but still pay your bills… so long as the default rates and/or delinquencies in credit cards do not start to rise again.

The recession is over.  The problem is that retailers have had to come to grips with the fact that Joe Public and family  is spending far less, is far more value-conscious, and is not really willing to blow up their credit card balances like they used to.

Target’s gimmick sounds pretty good on the surface.  It is still a gimmick.

JON C. OGG

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