Acquisition Program Essentials
Acquisition is the most common credit card marketing goal and the most expensive. The effort and expense to attract new cardholders can be wasted if those cardholders don't activate and use their cards. The best acquisition campaigns involve offering the right card to the right cardholder at the right price. To take it a step further they should also include some type of usage incentive as well. Preplanning your product is crucial to your acquisition success.To implement this type of campaign, you'll need to consider these steps:
- Select target (current cardholders and/or non-cardholders)
- Create the message/offer/appeal
- Select combination of media types (direct mail, postcards, statement inserts, Web)
- Estimate cost and expectations/goals
- Implement a tracking process to evaluate the outcome
- Include a balance transfer offer
- Include an incentive to use the card
There are a variety of Acquisition Programs. We've highlighted a few below based on your program goals.
Pre-Approval OffersNew Product Introduction
Loan Add-on/Cross-Sell
Balance Transfer Promotions
Repeat Messages at a Variety of Contact Points
Visa Acquisition Campaign
Pre-Approval Offers
Goals:
- Increase number of accounts
- Introduce new card program
- Tie additional product line to members
Considerations:
- Costly way to generate new cardholders
- May need a 3rd party to run pre-approval credit scoring
- They may not use the card
- Teaser rates - are you attracting loyal, long term cardholders or rate jumpers?
- Perceived as just another daily offer in the mail
New Product Introduction
Goals:
- Grow number of accounts, activation and usage by providing members with program options to better meet their card usage behavior. For example, offering a new low rate/no fee program, a cash rebate program, business program, teen program, or a travel awards program.
- Increase balances through balance transfer promotions included in new product offer
- Increase credit limits for cardholders being offered a chance to convert to the new card program
Considerations:
- Costly way to generate new cardholders if new product is not filling a missing niche
- Keep the new program simple for employees and cardholders to understand
- New program should be made available to current cardholders as well as non-cardholders
- New program offer should include incentives to transfer balances and to use the card within the first few months of receiving the card. Without incentives cardholders may switch to the new program creating just an expense and possible lower rate with no potential for increased income to the credit union.
Examples:
Qualstar Young Adult Card Promo (PDF)
Qualstar New Visa Gold Promo (PDF)
LAFCU Platinum Newsletter (PDF)
E1 Financial new product stuffer (PDF)
E1 Financial new product posters (PDF)
E1 Financial new product mailer (PDF)
AFTRA-SAG New Platinum Newsletter (PDF)
AFTRA-SAG New Platinum Poster (PDF)
AFTRA-SAG New Platinum Statement Insert (PDF)
Loan Add-on/Cross-Sell
Goals:
- Grow number of accounts by qualifying at time of application for another loan
- Tie additional product line to member
Considerations:
- Cardholders may not be in the market for another card
- May not use the card
- Slow impact on growth
- If loan officer is incented to cross-sell - member may feel obligated/pressured to accept
- Can offer a discounted rate on other loans
- Need an incentive to use the card
Balance Transfer Promotions
Goals:
- Build balances for existing or new card program
- Introduce a reduction in rate for an existing card program
- Maintain increased balances past the promotional period by offering a lower rate until paid off
Considerations:
- May attract rate jumpers, not loyal cardholders if lower rate is only for a specific timeframe.
- Can your DP system offer different rates for balance transfers?
- 0% are no longer commonplace.
- What is the appeal/offer? Most common is a lower APR then cash rebate/gift or points for reward cards. Keep the process simple and easy to understand.
- Offer a variety of ways to transfer balances (postage paid mail, Web, phone, and/or convenience checks).
- Can keep balance transfer tool on Web site all the time.
Best times of the year:
- Beginning of the year to pay off holiday purchases
- Summer for holiday planning
- Pre-holiday with credit line increase for current cardholders.
Examples:
California Bear Balance Transfer Promo (PDF)
Qualstar Balance Transfer Promo (PDF)
Amer 1st 2002 Take Us Shopping Promo (Word)
Amer 1st Transfer Rebate Direct Mail (PDF)
Amer 1st Transfer Rebate Stuffer (PDF)
Amer 1st 2004 Transfer News large (PDF)
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Repeat Messages at a Variety of Contact Points
Goal:
Increase visibility of all card programs.
Considerations
- Vary the medium to reach more cardholders
- Promotions should be placed in a variety of localities (Web, on- hold, lobby, mail, newsletter)
- Tracking the different mediums can be difficult
Granite Hills CU Newspaper Ads (PDF)
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Visa In-Brand Acquisition Campaign
Goal:
New accounts. Motivate and train employees.
Considerations:
- Promotion packets include point-of-sale materials, game cards, training tools, and more.
- Visa's Surprise Surprise promotion.
Visa Issuer's Guide (PDF)
Visa's 2008 Retail Branch Program 10.3 MB (PDF)