If your mailbox is brimming with credit-card offers, you aren’t alone.
But here’s the good news: The days of sifting through all those envelopes could soon be coming to an end. That’s according to a report released this week by Kantar Lightspeed Financial Services Group (FSG). It surveyed about 5,000 consumers between Feb. 26 and March 6, 2018. All the consumers had opened at least one credit card within the past six months.
The share of consumers surveyed who found out about their new credit card by direct mail has remained virtually flat every year since the survey was first done four years ago, said Greg Flemming, senior vice president of Kantar Lightspeed FSG. In fact, less than one-quarter of consumers find out about their new cards by direct mail.
Among those who were already planning to get a new card, however, most people found their card online, not through their post box: Approximately 17% found their new card from an online advertisement, 16% by online search and 15% from credit-card comparison websites. Only 17% did so by mail, and 18% found out about their card from a friend or family member.
How can you use junk mail to your advantage?
Use the offer to negotiate, and ask for benefits including lowering your interest rate, said Matt Schulz, a senior industry analyst at the credit-cards website CreditCards.com. Not enough consumers negotiate with their credit-card companies unless they’re over-extended and need to find a way to get out of a spending hole, experts say. But many companies won’t want to let you go.
Why have direct mail offers not increased?
Credit-card offers are moving online. It’s less expensive and it’s easier to target the right customers. Over the last four years, the share of consumers discovering new cards through digital offers shot up from 36% to 50%, the report found. The financial services industry in the U.S. spent $10.1 billion on digital ad spending last year, up from $6.2 billion in 2014, according to LendingTree.
How do credit-card companies get your data?
Credit bureaus Equifax EFX, -1.46% Experian EXPN, +2.02% and TransUnion TRU, -0.35% sell data, said Brian Karimzad, vice president of research at CompareCards.com. (Experian and TransUnion did not respond to requests for comment. An Equifax spokeswoman directed consumers here for information about how credit bureaus use their data.)
So who uses junk mail to take out a card?
Older consumers are more likely to respond to these offers. Among those who found out about their new card from direct mail, 52% were 50 or older, Kantar Lightspeed FSG found, and just 21% were under age 35. Of those who were not planning to get a new card: 24% found out about the card they ultimately got through direct mail. Just 9% did so from an online advertisement.