Credit Card Mailings Surged in 2000, But Response Is Down

Credit card companies mailed a record 3.5 billion pieces in the year 2000. But consumer response rates reached a record low of 0.6 percent, continuing an eight-year downward trend, according to Mail Monitor, the direct mail tracking service from BAIGlobal, Inc.

“The low response can be attributed to two factors–high mailbox clutter, which is making it difficult for card issuers to differentiate their offers, and the high penetration of credit cards that already exists,” said Andrew Davidson, vice president of competitive tracking services for Tarrytown, NY-based BAIGlobal.

Credit card mailings started to build slowly early in 2000, then surged in the fourth quarter, “the largest three months of mail volume we’ve ever seen,” Davidson continued.

Davidson attributed the high mail volume to the resurgence of gold card offers and aggressive marketing campaigns from monoline companies (firms that engage primarily in issuing credits). Other factors were the growth of mailings targeting consumers with poor credit ratings, and the launch of new card products with Internet-related features.

However, response was hurt by mailbox clutter. The typical U.S. household received more than three offers each month last year, Davidson reported.

Mail response also suffered from high penetration of credit cards. Three quarters of all U.S. households have a general purpose card, and most have more, according to BAIGlobal.

Of all mail solicitations sent last year, 17% were Gold card offers, compared with 4% in 1999.

“Although Platinum card solicitations still made up more than half of mailings overall, Gold cards re-established their presence in the marketplace,” Davidson said.

Meanwhile, one fourth of all solicitations went to people with poor credit ratings.

Internet-related offerings also increased, largely due to the launch of American Express Blue Card in late 1999, and the debut of VISA’s smart-card product in the fall of 2000. Mail volume will get another bump when MasterCard introduces its SmartCard this year, Davidson added.