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Many credit card issuers have put their account-acquisition plans on hold to cope with the economic downturn and instead are focusing on managing existing customers, Chris McWilton, U.S. markets chief at MasterCard Worldwide, said last week in New York at the Diversified Financial Services Conference Keefe, Bruyette & Woods sponsored. "[Many issuers] are shutting down [card-account] acquisition engines. Marketing campaigns that existed a year ago to acquire accounts ... have pretty much shut down," McWilton said. Instead of pouring additional funds into marketing, issuers are "working through credit losses" and are attempting to manage the risks and potential losses within their portfolios, he said. "Instead of [going out to] plant new groves of orange trees, they are trying to squeeze more juice out of what they have," McWilton said. Adil Moussa, an analyst with Aite Group, says card-marketing efforts have not ceased altogether. "Issuers are not completely shutting down acquisitions," he says. "They might be cutting back on expensive ways [direct mail] and focusing on branch-acquisitions and Internet [marketing], which is less expensive but not as efficient." Synovate, the Chicago-based market-research firm owned by London-based Aegis Group PLC, last month reported that issuers mailed 372.4 million card offers to U.S. households during the first quarter ended March 31, a 67% declined compared with 1.13 billion offers mailed during the same quarter last year.
