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Credit card mail increases 6 percent: Mintel study

In 2006, credit card and insurance acquisition mail volumes showed
substantial growth over 2005 numbers, according to a report released
by Mintel Comperemedia.

The competitive intelligence service that analyzes direct mail, e-
mail marketing and print media monthly said the clear gains in mail
volumes during the past year are due to an increase in campaign
launch activity. Mintel tracks the direct marketing activity of more
than 150 credit card companies.

“Emerging campaigns have been the key drivers in the overall mail
volume increases,” said Jenny Roock, director of Mintel, Chicago. “As
companies continue to look for new ways to attract consumers to their
products and services, several of the newer campaigns over the last
year have focused on tailoring their cards to specific consumers with
unique needs.”

Ms. Roock said the growth most specifically can be attributed to a
shift in 2006 towards more offers of rewards, points and cash back –
all promotions done through direct mail.

There has been an increase in promotions for reward credit cards
because they have become very competitive within the credit card
space, Ms. Roock said.

“Standard reward programs used to offer one point for every dollar
spent,” she said. “Now, in some cases, customers are getting five
points for every dollar spent, and they can be used towards things
like gas or groceries.”

In the credit card sector, more than 9.2 billion acquisition direct
mail pieces were distributed to U.S. consumers in 2006 to solicit new
and continued business. Chase was the top mailer for the year,
sending out more than 1.7 billion acquisition direct mail pieces.
This is a 4 percent decline from 2005, when Chase still held the top
spot. Rounding out the top five for 2006 were Capital One Bank (1.2
billion), American Express (1 billion), Citibank (980 million) and
Bank of America (920 million). Capital One posted 13 percent gain over
2005 in its direct mail activity, representing the largest gain of
the top five. Citibank and Bank of America, however, decreased their
volume by 2 and 17 percent, respectively.

Just missing the top five, HSBC and Discover increased their direct
mail acquisition activity between 2005 and 2006 by 25 percent and 29
percent, respectively.

Barclays Bank ranked among the top 10 in mail volume, with an
increase of more than 70 percent as it sent 193 million mail pieces
to U.S. mailboxes.

The insurance direct mail sector also demonstrated robust growth over
last year. Mintel tracks nearly 1,100 insurance companies.

According to Mintel, more than 6.8 billion acquisition direct mail
pieces were distributed to consumers in five key areas: auto, health,
life, property and casualty, and travel. Health insurance reported a
21 percent jump, while travel insurance declined sharply by 41 percent.

“With the [baby] boomer market moving into retirement, many companies
are strategizing to capture their business,” said Ms. Roock. “New
health programs and initiatives continue to build, and companies are
aggressively getting the message out to these potential consumers.
Travel insurance is still a healthy market, but several other
companies are rolling travel insurance into other packages and key

In addition, Ms. Rook said that there has been a big increase as a
result of promotional mailings related to Medicare and Medicare Part D.
Mintel predicted that further increases in postal charges and the emergence of more e-mail marketing will affect direct mail volumes this year. In fact, she said that while in 2003, about 56 percent of mailed solicitations directed recipients online. That percentage increased to 86 last year.

Ms. Roock also said that direct mail volumes would be reduced as
companies scramble to fund their rewards promotions.

“As credit card companies continue to offer reward programs, they
will have to continually find the dollars to fund them,” she said.

“As a result, they will take money out of their direct marketing

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