Go big or go home: How Truist should approach its card marketing strategy

On December 7th at 7 am in a series of coordinated posts, both SunTrust and BB&T took to social media to proclaim that they had joined forces to become Truist (NYSE: TFC). The merger, which completed late on Friday after receiving regulatory approval by both the Federal Reserve and the FDIC, will reportedly create the sixth largest bank in the US with approximately 10 million customers. When the two credit card portfolios are combined, Truist will reportedly be the sixteenth largest credit card issuer in the US, according to The Nilson Report. SunTrust and BB&T will continue to operate as separate brands for now with integration taking place over a two-year period. The message to customers according to those social media posts: 1) No changes to checking and savings (at least for most) and 2) smooth transition.

From a credit card perspective, there clearly will be changes and Truist will be under-performing from the get-go on one key metric. The combined portfolios of SunTrust and BB&T put Truist at sixteenth in terms of outstandings which, for a bank ranked sixth in the nation, is well behind its peers. The five banks larger than Truist are all in the top 10 when it comes to credit cards; PNC – more comparable to Truist in size and profile – is ranked twelfth, according to The Nilson Report. Truist needs to move quickly to re-configure its combined credit card portfolio and then ramp up its marketing spend from current levels if it wants to match its new status as the sixth largest bank. According to data from Comperemedia Omni, the estimated combined marketing spend by SunTrust and BB&T on key direct, digital, and social channels is well below what is typical for a super-regional bank.

What we think

As national banks increasingly look to build enterprise-wide relationships by leveraging credit cards, it is more important than ever for regional banks to not only defend their territory but to go on the offensive. The extent to which Truist will thrive as a brand depends on whether the new organization can embrace its new profile as a super-regional bank. This means a mindset shift and an adjustment in outlook that will be reflected in every decision made by the new organization, from seeking marketing efficiencies to streamlining its product line-up, to the urgency in making these changes. There is an opportunity for Truist to think big and to take advantage of a rare opportunity to redefine its position in the market.

For more on the strategic implications for both Truist and its competitors, please get in touch.