Sears, Roebuck & Co. will “rein in” marketing programs this year at its credit card operation after being exposed to “less reliable customers” last year, the Associated Press quoted Sears chairman and chief executive Alan J. Lacy as saying yesterday.
The credit card segment, which represents about two-thirds of the company's operating income, experienced success overall as it ramped up its MasterCard last year, Lacy said. Results from the MasterCard have been affected by the failure of some marketing programs to attract quality customers, he told investors at a conference in New York hosted by Bear Stearns & Co.
In 2002, 15 percent of Sears MasterCard balances were acquired via pre-approved, direct mail offers. Those accounts have been unprofitable, he said. Along with cutting back on these offers, the company will reduce offerings of convenience checks and balance transfers that were not profitable. Sears is also reducing credit lines for high-risk customers of its proprietary credit card and MasterCard, Lacy said.