Chicago (June 12, 2012)—The cool-off in credit card mail that began in the winter of 2011 looks set to continue, at least for now, according to Mintel Comperemedia. In April, 260 million offers for new credit cards were received by US households, down 33% from the 390 million offers US households received during April of last year. This is the lowest estimated monthly mail volume tracked in the past 25 months.
“April marks a new low for the credit card direct mail decline that began in December 2011,” says Andrew Davidson, senior vice president at Mintel Comperemedia. “The last time volumes were lower was back in March 2010. At that time a come-back in direct mail was gathering steam following severe cut backs during the recession. That come-back turned into a two-year period of expansion that peaked in June 2011 when 497 million offers were received by US households.”
“Issuers have adopted a more cautious approach due to an uncertain economic environment. The latest downturn likely reflects a pause in activity rather than signifying a permanent reduction in direct mail,” adds Andrew Davidson. He offers an explanation for the optimistic outlook:
• Credit card direct mail is cyclical, with volume trends reflecting the peaks and troughs of the Dow as a barometer for the health of the US economy. Once the long term outlook for the economy gains more solid footing, confidence—and direct mail volumes—will return. • Other advertising channels are not taking up slack. Online advertising and social media are supporting traditional channels like direct mail, rather than replacing them. • A tough competitive environment and continued innovation within the credit card space suggest the decline may only be a temporary hiatus rather than a longer term trend, as card issuers seek ways to stand out from competitors.
“Credit card direct mail volume will be significantly lower in 2012 than 2011,” concludes Andrew Davidson. “For credit card issuers this is a great time to be in the mail. The mailbox is less cluttered and it is easier to get consumers to notice your message.”