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Financial pressure slows credit card solicitations in the US; Canada soon to feel impact
Chicago (April 23, 2009)-Our neighbors to the north still get their mailboxes filled with credit card offers, even as space opens up in ours. New data from Mintel Comperemedia, a service that provides direct marketing competitive intelligence, shows credit card issuers haven't reduced mail solicitations in Canada as rapidly as they have in the US.
Last year, credit card issuers only reduced direct mail offers to prospective Canadian cardholders by 8% (Q4 2007 to Q4 2008). In the US, they cut such mailings by 50%. Mintel Comperemedia attributes this difference to a less severe financial crisis in Canada during 2008.
Stephen Clifford, Vice President of Financial Services at Mintel Comperemedia: "In Canada, the economy and financial system remained relatively strong last year, so banks were not forced to reduce marketing direct mail offers as substantially as in the US. Canadian banks did not face the same levels of loan losses or tightened credit that US issuers did."
Though Canada's economy was fairly stable last year, economists predict a slowdown during 2009. Mintel Comperemedia expects credit card mailings to follow suit and drop as well. A 20% decline in solicitations is projected* for Q1 2009 in Canada (from Q4 2008). However, this reduction still pales next to the 47% drop projected in US mailboxes.
"Banks in Canada now feel the impact of the global recession and increasing credit card losses at home," adds Stephen Clifford. "With unemployment and personal bankruptcies on the rise in Canada, issuers are becoming more discerning about who they send new card offers to and how many are being distributed."
*Based on credit card acquisition direct mail volume from January - February 2009
Mintel Comperemedia provides competitive intelligence for businesses looking to advance and improve their direct marketing strategy. Tracking direct marketing (including mail, email and print advertising) targeted at consumers, small businesses and insurance agents, Mintel Comperemedia offers a unique perspective on everything from banking trends to insurance trends to credit card statistics. For more than 38 years, Mintel has provided insight into key worldwide trends, leading the industry for consumer, product and media intelligence.
Joanna Peot
Public Relations Executive
312-628-7946
jpeot@mintel.com