Silver Lining in Economic Crisis: Less Junk Mail?

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Silver Lining in Economic Crisis: Less Junk Mail?

CHICAGO -- In the wake of the nation’s economic and credit crisis, credit card companies severely cut back on the amount of direct mail offers they sent to Americans.

Credit card direct mail volume declined in 2008 by 26 percent, to only 5.4 billion offers, the lowest annual total since 2000, according to date from Mintel Comperemedia, an industry service for competitive intelligence on direct marketing.

Direct mail offers for acquiring new card users peaked at 8.3 million in 2006, according to the research firm.

"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, vice president of Financial Services at Mintel Comperemedia.

The number of mail offers sent for new credit cards dropped steadily throughout 2008. Mintel Comperemedia reports an 8-percent decline from the first quarter to the second quarter, and a 13-percent decline from the second quarter to the third. But the fourth quarter 2008 stands out with the most notable quarterly drop: 33 percent from the third quarter 2008.

Companies showing the biggest drop, year over year, were HSBC (down 61 percent), Citibank (down 36 percent), First Premier Bank (down 34 percent), and the biggest mailer, Chase (down 30 percent).

While estimated direct mail volume for credit card acquisition fell across the board in 2008, individuals with the highest incomes barely saw a change in their mailboxes. Mintel Comperemedia reports that households making more than $100,000 a year received only 1 percent fewer credit card offers in 2008 than in 2007. But households making $50,000 or less saw a 42 percent drop in new credit card mail volume.

"Credit card issuers shifted direct marketing strategy to focus on higher earning, lower risk consumers," stated 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."