Debit Marketing Essentials
This site is intended to help you grow your card portfolio. We'll show you how to evaluate your card programs and build the most cost-effective marketing campaigns to meet your card portfolio goals. In addition to all the information below, there are often marketing tips in the Payment Processing Solutions News Service mailings, so check them often.
Here's how to start getting most from your portfolio:
Step 1: Evaluate your card programs - annually
Step 2: Plan Your Marketing Campaigns
Marketing Calendar
Implement some form of rewards
Quarterly Statistics and Payment Processing Solutions Reports
Web Sites, Important Dates, and Other Resources
Step 1: Benchmark Your Portfolio.
By breaking down your card programs performance you can better utilize your marketing efforts:
- Acquisition: account-to-member ratio
- Activation: Number of activated cards vs. inactivated cards
- Usage: average number of transactions per month and number of cardholders actively using their cards for signature based transactions each month.
(You can utilize a variety of Payment Processing Solutions Reports to help you look at these key factors).
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Step 2: Develop Strategies
The campaigns you choose to participate in each year should be based on the Acquisition, Activation, and Usage goals you've determined in Step One above. Under each section we have a collection of case studies and media samples.
Do you have a case study/campaign you'd like featured? Contact Dan Green.
To make the largest impact on your marketing efforts, make sure to include the following elements in your debit campaign messages.
- Security features - Make sure to include all your fraud protection tools; Zero Liability, VBV/Secure Code, and Neural Network. Try packaging up all of fraud features, give it a catchy name to make it a selling feature of your debit card program.
- Speed and convenience over checks
- Promote recurring payments - The best communications for paying bills with your debit card should not only focus on the convenience but assurance that the process is safe and secure.
Acquisition
Growing the debit card program is perceived as a difficult challenge because the debit card is often thought of as a convenience product for your DDA (checking) accounts. Most acquisition campaigns solely focus on marketing to current DDA members. We think there is more potential.
Target the following members:
- New Members - All new DDA accounts should receive a debit card. It's best to include a discount offer to encourage early acceptance. In-branch promotions and employee education are also helpful.
- Members with an ATM card - You can upgrade all ATM cardholders with a debit card through a mass reissue and/or at renewal time. You will need to do repeat educational messages and incentives to get this type of cardholder to switch from PIN to signature-based behavior.
- Members who do not have an ATM or a debit card - This group may be unfamiliar with the difference between PIN and signature transactions and will need some hand-holding to understand how to use their card.
- Introduce new niche products - Teen debit, senior debit, and Hispanic market. All three groups need tailored educational materials on the benefits of debit signature cards. Another option is a Premium debit card for your Premium credit cardholders that also carry your debit card.
- Savings-only members - The primary obstacle in getting this group to adopt your debit card is the difficulty in converting their checking to your credit union. Online Switch Kits (PDF) are an excellent way to encourage the ease of moving accounts. Add a rewards program like JHA Payment Processing Solutions' Extra Awards along with an easy on-line switch kit and you have the tools and the incentives to get this group to move their accounts.
Example:
USA Federal's Debit/Credit Incentive
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Activation
Many of your cardholders will activate and begin using their card once they receive it, others will need varying degrees of encouragement and incentives. Your objective should be to reach cardholders who have not activated their card with 60-90 days after issuance.
Our Inactive Card Report can help you manage these accounts. Details on this and other JHA Payment Processing Solutions reports are here under "Quarterly Statistics."
An automated letter can go out to all cardholders that have not activated 90 days after issuance. A follow-up telemarketing call should occur after 180 days of non-activation. It's best to block the card for those who do not intend to use the card.
Encourage first-time usage with activation
- Participate in Visa and MasterCard's national promotions to provide an incentive to use their card and be eligible to win.
- "Use it and Win" promotions have also proven to be effective. Using our activation report or reports from your DP system you can mail an offer to unactivated accounts and offer them a gift, cash, gift certificate, eligibility to win…if they use their card by a certain date.
- Incentive Marketing Programs: By using merchant offers provided by Visa and MasterCard, you can create inserts and/or online coupons as incentives for first-time usage.
Educational materials
- Use in-branch materials, statement inserts, card inserts and other contact points to reinforce the importance of activating their card.
- Educate them on the safety, security, and ease of using their debit card.
- Explain the benefits of Zero Liability.
- Give them suggestions on where to use their card for signature transactions; grocery stores, doctor's co-pay, bill pay, online, catalog orders and gas stations.
Example: Qualstar's Fraud Protection Insert
Both Visa and MasterCard offer educational materials to help explain the two ways to use your debit card. Many are available in English and Spanish. To order, go to: www.visaonline.com or mastercardpromotions.com/mastercard.
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Usage
The goal here is build habitual, incremental debit card usage. Active users are a great source of revenue. Usage campaigns should be geared toward finding more ways for active users to use their card and to motivate medium users to increase usage. They can be based on card education or card inactivity.
For best results you can divide your cardholders into these three categories:
- Low users: 1 - 4 signature-based transactions a month
- Medium users: 5 - 9 times a month
- Heavy users: 10 or more a month
Or take a look at your current usage numbers to see where your average usage numbers are today to develop goals specifically for your cardholders.
Based on their type of usage you can create a marketing campaign to achieve the best results. If you have low recurring billpay, try a usage campaign just for this merchant category group.
Education
These programs are excellent for low-usage cardholders.
- Offer new places to use their card, like bill pay and co-payments for doctors visits. Adding bill payments will increase your average ticket size. Average bill payment is $68.
- Convenience and security are again very important for this group.
Incentives and Sweepstakes
Medium users know how to use their card but may need a little push to use their card in new places. Based on your month-to-date statistics report, you know the average number of transactions your cardholders do each month. To help encourage higher usage you can run incentive and sweepstake promotions to get them to do more than their average. JHA Payment Processing Solutionscan keep track of cardholder activity for your promotional period and report back to you at the end so you can perform the drawing or redeem the incentive. Our Cash Rebate and Usage Program (Word) document will give you more details on how we can help.
Incentives, sweepstakes, and rewards are the added benefit many cardholders need to change their PIN-preference behavior. With so many merchants forcing your cardholders to enter a PIN, it's crucial for issuers to provide valuable reasons for cardholders to sign for their transactions instead.
Examples:
Qualstar Debit Signature Promotion (PDF)
USA Federal's Debit Card Design (PDF)
Don't be a PIN head (PDF)
Skip the PIN and WIN (PDF)
Dinner and a Movie (PDF)
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Utilize Visa and MasterCard's National Promotions
Both offer free and low-cost signage and inserts in conjunction with their sweepstake promotions on a regular basis and you can use their marketing budgets to increase loyalty and usage. To order, go to: www.us.visaonline.com or www.mastercardpromotions.com.
How about combining one of the National Promotions with your own sweepstakes like American First CU did. They piggy-backed one of Visa's National Sweepstakes to give their $2,000 cash sweepstakes an even higher perceived value. They called it, "You have two chances to Win."
What a great idea!
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Rewards
Rewarding cardholders is an easy way to encourage high usage and sustain loyalty. Rewards are beginning to be more common on debit card programs. Rewards can:
- Create differentiation
- Attract new cardholders
- Maintain and expand usage
- Drive specific usage behavior
- Increase loyalty/retention
Most debit reward programs are point-based programs using gift certificates, cash, and/or travel but can also be simply cash rebate or discount based. For more, see our Extra Awards program.
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Marketing Calendar
Remember that single promotions accomplish very little. You need a well-planned program. The elements in your plan are:
- Web advertising
- Newsletter articles
- Print advertising
- Direct mail
- Statement inserts
- On-hold messages
- Lobby signage, banners & posters
- Conferences & speaking opportunities
The following calendars are intended to be used as suggestions of campaigns that can be added to your marketing calendar based on your card program goals.
- A credit union in Alaska has shared a Visa Marketing Calendar (Word).
- A sample credit card calendar (Word) based on program goals (ie: Acquisition, Increase balances, increase usage). This is an annual calendar highlights which campaigns will take place each month. We also have a Calendar Template (Excel) if wish build you own calendar.
- Amer 1st Sample Marketing Calendar (Word). For a complete production calendar take a look at how American First Credit Union blends their credit card promotions in with all of the other product lines they need to promote throughout the year.
Quarterly Statistics and JHA Payment Processing SolutionsReports
We've provided you with industry performance numbers and Payment Processing Solutions performance numbers taken from our month-to-date statistics report.
- The Month-to-Date Statistics Report is available at the end of each month for each BIN through On-Demand. This report breaks down the number of active accounts, average number of transactions per active account, number of disputes, cards ordered, VBV usage and other activity based statistics for each BIN.
- Inactivated Card Report is available monthly and gives you all cards issued that have not activated their cards. This report is useful for a letter or calling campaign to incent cardholders to activate their card. For those that do not wish to activate you can delete them from future card reorders.
Web Sites, Important Dates, and Other Resources
Card and Credit Union Web Sites (Word)
MasterCard Promotions
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