5 things credit card marketers should do right now to adapt their acquisition strategy during the COVID-19 crisis
At the end of March, US Federal Reserve Chairman, Jerome Powell, conducted a rare interview on NBC’s “TODAY” show. In the context of credit card acquisition strategy, a number of comments were particularly pertinent and are worth highlighting.
- “We may well be in a recession.”
- This is the sobering reality but hardly surprising as some parts of the economy grind to a halt.
- “There is nothing fundamentally wrong with our economy.”
- In other words, we should be in a good position to bounce back (but with the unemployment crisis mounting there are growing fears of a long-lasting global recession).
- “This is a unique situation. This is not a typical downturn.”
- We can’t necessarily run the playbook from the last recession.
Consumer demand for credit hasn’t necessarily declined and, if anything, will likely increase as the country navigates what some economists are referring to as “The Great Shutdown of 2020.”
This means credit card acquisition can and should continue but, consumer behavior has shifted abruptly and card marketers need to balance being sensitive to a rapidly changing situation while also seeking out new opportunities to add value as consumer needs evolve.
Here are 5 things credit card marketers can do right now to adjust in the midst of the crisis:
1) Focus on everyday spend: It’s very important to audit the creative and messaging for any products going to market to ensure they strike the appropriate tone amidst current travel restrictions and social distancing guidelines. Cash back cards and cards with accelerated earn on everyday spend, as well as non-rewards cards, are more suitable for promotion in the current environment, and lifestyle marketing should be avoided.
2) Offer incentives that resonate: Cash is always king, particularly now with many consumers concerned about the economy. Additionally, elevating incentives for the types of services that consumers are purchasing as a result of spending more time at home, such as third party delivery apps or streaming services, even for a limited time,will resonate with some consumers.
3) Amplify the digital call-to-action: Direct mail offers should amplify instructions for submitting applications online so that applicants do not feel obliged to leave their homes to visit a mailbox, and references to in-branch or in-store applications should be removed – even if the location is still open. Although the risk of catching the virus from the mail has been deemed minimal by experts, the response could decline and supporting a direct mail campaign with email and/or other digital channels, wherever possible, is now more important than ever.
4) Promote contactless and mobile payment functionality: Not all US cards have been converted to contactless so avoid promoting contactless as “safer” from a health perspective; instead, use messages that discuss the security and convenience of contactless and mobile payment features.
5) Get creative on social media: Brands across a range of industries have taken to social media to get their messages across and engage with consumers in new and creative ways during the crisis. With more consumers spending their newfound free time on social media, now could be the time to test out a new acquisition channel or approach that you haven’t tried before.