The marketers for credit card issuers are tentative due to continued economic malaise, with direct mail volume hitting a 25-month low in April, according to Mintel Comperemedia.
In April, 260 million offers for new credit cards were received by U.S. households, down 33% from the 390 million offers that U.S. households received during April of last year. The last time volumes were lower was back in March 2010.
At that time, a comeback in direct mail was gathering steam following severe cutbacks during the recession. That comeback turned into a two-year period of expansion that peaked in June 2011 when 497 million offers were received by U.S. households, says Andrew Davidson, senior vice president at Mintel Comperemedia.
The latest downturn likely reflects a pause in activity rather than signifying a permanent reduction in direct mail, he says. Credit card direct mail is cyclical, with volume trends reflecting the peaks and troughs of the Dow as a barometer for the health of the U.S. economy, he explains.
Once the long-term outlook for the economy gains more solid footing, confidence — and direct mail volumes — will return.
In the meantime, other advertising channels do not appear to be taking up slack. Online advertising and social media are supporting traditional channels like direct mail, rather than replacing them.
A tough competitive environment and continued innovation within the credit card space suggest the decline may only be a temporary hiatus rather than a longer-term trend, as card issuers seek ways to stand out from competitors.
Still, credit card direct-mail volume will be significantly lower in 2012 than 2011, Davidson says. For those willing to hedge their bets about the economy, it is a good time to make offers.
“For credit card issuers, this is a great time to be in the mail,” he says. “The mailbox is less cluttered and it is easier to get consumers to notice your message.”