You don't necessarily need pristine credit to take advantage of these offers, either, says Lisa Hronek, senior analyst for market research firm Mintel Comperemedia. Because there are so many of these offers out there, they're likely spread across a range of credit scores, she says: "Card issuers can play with things like credit limits if a person's credit profile is risky," says Hronek.
Although check-boxes to opt into credit protection on applications largely disappeared, some issuers continue to include the offers in reduced volumes, said Lisa Hronek, senior analyst at Mintel Comperemedia."I think the issuers are temporarily backing away," she said. "It was the marketing that got them into trouble."
Consequently, debit card marketing is on the rise according to Mintel Comperemedia – creating more competitive pressure. It is reported that financial institutions mailed out 42 million direct mail offers last year, up 6% from 2011.
Last year, banks sent out 42 million direct-mail offers for new debit cards, up 6% from 2011, according to Mintel Comperemedia. “It does appear that banks have regained their footing to some degree and are beginning to focus on debit card marketing,” says Susan Wolfe, vice president of research at Mintel Comperemedia.
Susan Menke, VP, financial services at Mintel, said that “...the fact that younger Boomers are struggling with their household finances is bad news for economic growth... this age group... is usually at the peak of their earning power... has traditionally been a primary driver of consumer spending and therefore of the economy... these younger Boomers will likely delay retirement for financial reasons, which will impact the already difficult job prospects for Millennials and Gen Xers... "
According to a survey from Chicago-based marketing consultant firm Mintel Comperemedia, 40 percent of all offers to open a new savings account in 2012 included some kind of incentive. Those incentives include cash bonuses or higher interest rates for larger deposits.
Confidence is a distinctly American quality, but are Americans dusting off the gloom of poor economic conditions and moving on? According to the latest research by Mintel on consumers’ attitudes about the economy, folks in the US are not looking at the future through rose-colored glasses. Indeed, almost three in four (72%) US consumers think younger generations will have a more difficult time than they had, and nearly half (49%) think that other countries offer better opportunities than the US.
Debit card usage is rising, and banks are responding by sending customers more direct marketing offers to try and capitalize on the growing market. Despite the Durbin Amendment, which went into effect in October 2011 and capped debit swipe fees, banks sent approximately 42 million offers for new debit cards last year, a 6-percent increase over 2011, according to new research from Mintel Compremedia.
Mintel Corp.'s latest data show United States debit issuers haven't slowed marketing their card programs, just changing the emphasis: Today's direct marketing campaigns encourage people to use debit because of security and convenience, particularly for everyday purchases. Marketing pieces try to get people to use their debit cards more, activate new cards or take advantage of just-released card features. Banks have also started to introduce statement rewards programs to replace the old style debit reward programs.
With debit card usage on the rise, new findings from Mintel Comperemedia show that banks are following suit—sending more direct marketing offers to capitalize on the growing market for debit. Despite the October 2011 Durbin Amendment, which caps debit swipe fees and profitability for banks—Comperemedia reports that in 2012, banks sent approximately 42 million offers for new debit cards, an increase of 6% over 2011.
Susan Menke, VP, financial services at Mintel, said:
"The fact that younger Boomers are struggling with their household finances is bad news for economic growth, as it is this age group which is usually at the peak of their earning power, and has traditionally been a primary driver of consumer spending and therefore of the economy. This is also problematic for younger generations, as these younger Boomers will likely delay retirement for financial reasons, which will impact the already difficult job prospects for Millennials and Gen Xers."
That "can-do" spirit that has permeated the American culture since its founding nearly 240 years ago may be wavering. According to the latest research by Mintel on consumers’ attitudes about the economy, folks in the US are not looking at the future through rose-colored glasses. Indeed, almost three in four (72%) US consumers think younger generations will have a more difficult time than they had, and nearly half (49%) think that other countries offer better opportunities than the US.
For example, issuers dialed back the number of card offers they mailed to consumers in 2012 by nearly 40 percent compared to the previous year, according to research by Mintel Comperemedia.
"We're not seeing the 18- or 21-month [promotional] interest rate we have in the past," says Andrew Davidson, a senior vice president at Mintel Comperemedia, which tracks direct mail offers. Issuers are instead competing more directly with rewards, he says. "There's still a lot of competition and innovation in rewards," says Davidson.
Mintel Comperemedia calculates that reward card offers make up 75 percent of all card offers sent through the mail. "Reward cards are almost the new plain vanilla," said Andrew Davidson, senior vice president at the analysis company. "If you can qualify for a card, most people can qualify for rewards."
