Credit card companies mail fewer offers for second consecutive year
29 March 2004
As personal bankruptcies reach record highs, card issuers change offer strategy.
ARLINGTON HEIGHTS, ILLINOIS — SYNOVATE today reported that annual credit card mail volume for 2003 decreased by 12% compared to volume in 2002.
The findings, which were compiled using Synovate's Mail Monitor, showed that 4.29 billion credit card offers were received by US households during 2003 down from 4.89 billion in 2002, while consumer response remained low at just 0.6%. The year-on-year drop follows a record 5.01 billion offers set for mail volume in 2001.
On average each month 69% of US households received 4.8 offers during 2003 vs 75% of households receiving 5.1 offers during 2002. "During 2003 typical seasonal mailing patterns went out of the window," said Andrew Davidson, Vice President of Competitive Tracking Services for Synovate's Financial Services Practice. "90% of credit card direct mail comes from the 10 largest card issuers and in 2003 half of those issuers cut back causing the overall decline in mail volume".
In 2003, an all time record was set for personal bankruptcies and despite recent improvements to the economy, unemployment remains high. "Card issuers have reacted to this environment by mailing fewer low introductory rate offers and decreasing the frequency of mailings to lower income households," said Davidson.
"At the same time," Davidson continued, "we have seen a significant increase in offers promoting rewards and cash rebates as issuers seek new ways to stand out from the clutter and acquire customers that are less likely to switch."
1.27 billion reward offers were received by U.S households in 2003, up from 0.81 billion in 2002. Rebate card mail volume increased to 0.90 billion from 0.68 billion over the same time period.
"Although volumes were down for the year, I was encouraged by our December 2003 findings," Davidson said. "Many issuers who had cut back overall in 2003 finished with a strong December and I would not be surprised if the year begins with strong mailing volumes overall."
Contact(s) for this press release
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Andrew Davidson
Vice President |
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222 South Riverside Plaza |
Telephone: +1 914-332-5300 |
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