Capital One Continues to Innovate

Historically an aggressive marketer and innovator in the credit card industry, Captital One has expanded its reach in recent years, using their growing banking franchise as the foundation for introducing innovative banking products. In addition to having a relatively rich debit rewards program and expanding into online and small business banking, they have recently introduced a new savings product called "InterestPlus Online Savings".

The saving program offers an above market interest rate on balances over $2,500 in addition to a 10% quarterly interest bonus payment paid if the customer uses their Capital One credit card once a month.

Credit Card DM Volume Finally Rises

For the first time in three years, credit card-related direct mail volume increased during last year's fourth quarter according to research recently released from Mintel Corporation.

According to the research, while the volume of credit card direct mail in 2009 (less than 2 billion pieces) was 66% less than in 2008 and far less than the annual level of 7 billion a year experienced from 2004-2007, there was an increase of 47% during the fourth quarter of last year, compared to the previous quarter. Contributing to this increase, Chase increased their credit card mailings by the largest amount – 87% over the same period in 2008. In addition, US Bank's credit card mailings were up 64% over the same period of time, according to the study.

Mintel Comperemedia Looks at Financial Service Mega-Trends

In a Mintel Comperemedia presentation recently, Economic Psychologist, Susan Menke, PhD. presented the trends that are expected to have the greatest impact on consumer financial behavior and the banking industry during 2010. Based on tracking of direct marketing programs during the last half of 2009, the following predictions were made:

• The end of Free Checking: Banks such as Fifth Third and BBVA have already eliminated the account while Free Checking leader TCF announced the end of their Free Checking program at their investor meeting this week.
• Explosion of reward banking: The decline in Free Checking will most likely result in an increase in checking programs with rewards, especially in light of the increased importance of direct deposit, online bill payment and debit card interchange.