Credit-Card Mailings Drop 26%; Offers to Wealthy Hold Steady

February 10, 2009

This article is included in these additional categories:

Data-driven | Financial Services | Personalization

Credit-card issuers sent a total of 5.4 billion credit card direct mail offers to Americans in 2008, the lowest annual total since 2000 and a 26% plunge from 2007, according to estimates from Mintel Comperemedia.

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Overall Offers Down

The number of overall mail offers sent for new credit cards dropped steadily throughout 2008. Mintel reports an 8% decline from Q1 to Q2 and a 13% decline from Q2 to Q3. However, Q4 2008 had the most notable quarterly drop: 33% from Q3 2008.

Top credit-card issuers with the highest drops in credit card mailings for 2008 included HSBC (-61%) and Citibank (-36%). In contrast, Barclay’s bank had an estimated 28% increase in mailings vs. 2007.

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Mintel estimates that credit card mail volume was 7.4 billion in 2007 and 8.3 billion in 2006.

“With reduced funds available for lending and increased loan losses, credit card issuers had no choice but to drastically cut direct marketing for new cards during 2008,” said Stephen Clifford, VP of Financial Services at Mintel Comperemedia.

Little Change in Mailings to Wealthy

Despite the across-the-board plunge in credit-card acquisition volume in 2008, individuals with the highest incomes barely saw a change in their mailboxes. Households making more than $100K annually received only 1% fewer credit card offers in 2008 than in 2007.

In contrast, households making $50K or less saw a 42% drop in new credit card mail volume.

“Credit card issuers shifted direct marketing strategy to focus on higher earning, lower risk consumers,” said Stephen Clifford. “2008 was an adjustment year for the credit card industry as issuers were confronted with economic conditions not seen in decades. In 2009, I expect less volatile fluctuations in mail volume as the industry positions itself to ride out the recession and recover.”

In related news, Mintel Comperemedia reported in late 2008 that credit card issuers were taking additional actions to stem losses, including closing inactive accounts, lowering credit limits, and raising rates and fees.

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