‘Plain’ Credit Card Offers Jump to 30% of Mailings

Credit card direct mail offers for “plain vanilla” cards – those with no annual fee or rewards – have made a comeback as issuers target a stronger demand for credit.
Plain credit card offers accounted for 30 percent of acquisition mail volume in the fourth quarter of 2011, compared to just 13 percent a year earlier, according to Mintel Comperemedia.
Frequently mailed offers for basic cards include the Citi Simplicity card, the Slate card from Chase and Capital One’s Platinum MasterCard.
Following the peak credit-crunch period in 2008-2009 and credit card reform legislation in 2010, card issuers filled mailings with rewards card offers that carry annual fees. They were mostly targeting consumers with good credit histories.
The new laws restricted some fees and interest rate hikes in the first year of a credit card agreement.
Moreover, the Federal Reserve has committed to low rates until 2014, a policy that is fueling the “0%” teaser rates common in the competitive environment for plain, non-rewards cards.
“Plain vanilla cards target revolvers who typically carry a balance from month to month,” said Andrew Davidson, senior vice president, Mintel Comperemedia. “During the downturn, plain vanilla became a niche segment as access to credit from all sources dried up nationwide. Card issuers focused their attention on consumers with excellent credit histories, resulting in a proliferation of credit card offers promoting rewards and other perks.”
Among offers with an intro APR for balance transfers, 72 percent promoted an introductory period of 13 months or more in the fourth quarter of 2011– compared to 58 percent a year earlier.

Leave a Reply

Your email address will not be published. Required fields are marked *