Financial Services Emails Click-Through Rates Hit 5.8%

As telemarketing becomes crimped by the new “Do-Not-Call Registry,” and as Internet advertising regains strength, email continues to deliver strong results as a marketing tool. Click-through rates from email increased from 7.5% in 2Q/02 to 8.3% for the second quarter of this year, but the average revenue generated per email delivered in the second quarter was $0.28, versus $0.29 one year ago. The findings come from DoubleClick’s latest research which also shows that those who clicked on email links clicked an average of 1.6 times per email. The Financial Services emails had the highest category open rates at 48.1% while their click-through rates were the lowest among the categories measured (5.8%), which could reflect increased consumer interest in investments but the highly considered nature of financial services offerings. The second quarter data is based on over 2 billion permission-based emails from hundreds of clients.

Active Card Balances Up 3% Year-Over-Year

Americans carried an average balance of $2,526 on each bank credit card account at the end of July, compared to $2,451 for July of last year, based on data for the top ten U.S. issuers. Year-to-date charge volume, among the top issuers, averages $2,611 per active account, compared to $2,469 for July 2002. Bank One continues to lead the top issuers with the highest average balance per active account of $3,793 and the highest year-to-date volume of $4,767 per active account. While Capital One, an issuer specializing in under $20,000 credit limits, has the lowest year-to-date volume per active account of $1,170.

TOP TEN ISSUER STATS – JULY 2003
(ranked by total outstandings as of 7/31/03)

ISSUER AAB AAV
1. Citibank $2506 $3022
2. MBNA $2447 $3054
3. Bank One $3793 $4767
4. Chase $3066 $2994
5. Discover $2350 $2696
6. Cap One $1637 $1170
7. BofA $3059 $3020
8. Providian $2351 $1351
9. Household $1440 $1802
10. Fleet $2607 $2232
AVG $2526 $2611
AAB- average balance per active account; AAV- average year-to-date volume per active account
Source: CardData (www.carddata.com) and RAM Research Group’s Bankcard Barometer

TransLink Lawsuits Dismissed, ERG Wins

The battle over San Francisco’s smart card-based transit fare system has apparently ended as the California Superior Court has dismissed a lawsuit by Cubic Transportation Services to block continuation of the “TransLink” project. The Bay Area’s Metropolitan Transportation Commission has also granted final acceptance to ERG Transit Systems, a Cubic competitor, for “Phase 1” of the “TransLink” project. The move clears the way for an order for over 4,000 pieces of equipment needed to launch full system implementation. The “TransLink” system, the largest regional smart card based transit fare collection system in the USA, will provide a single payment system encompassing all major transit systems operating in the Bay Area, including buses, ferries, and light, medium and heavy rail systems. When fully operational, “TransLink” is expected to handle more than 25 million smart card transactions every month.

Regal Entertainment Deploys Fujitsu Terminals

TN-based Regal Entertainment Group is planning to deploy 300 Fujitsu customer-activated terminals within its 562 cinema locations nationwide. Fujitsu and Regal developed the customer-activated terminal to print Regal’s movie tickets and provide other services on a real-time basis through an interface directly to Regal’s back office systems. By this fall even more services will be added. For example, the Express machines will become the primary movie ticket pick-up point for Fandango’s Print-at-Home service, where customers purchase their movie tickets on the popular Fandango.com Web site.

CREDIT USAGE

A new survey shows that 25% of Brits use their credit cards for household bills and other day-to-day expenses, and that slightly more than 50% said they owed more than £10,000. Also, credit cards volume stood at £8.8 billion in June, 2.8% lower than in May and just 0.8% up on June last year. This includes a rise of over 8% in credit card spending on services, largely offset by a six per cent fall in spending on the high street.
The Credit Card Research Group also reported that growth in debit card spending continues to outstrip credit card spending, with a year-on-year rise of 10% to £9.9 billion in June, despite a fall of over 3% on MayÕs figures. This reflects continued growth in the widespread use of debit cards, particularly in the service sector where spending has increased by nearly 27% in the year to June. Meanwhile, the recent survey by KPMG also found that nearly one in six people said that their escalating debts worried them so much that they could not get a good night’s sleep. The KPMG research also revealed that more than 80% of those surveyed said they hoped to pay off their debts within five years, with 22% saying they would work overtime, or try to get a new job or a promotion to pay them off. But 7% planned to take the drastic step of selling their home or remortgage it to clear their other borrowings.

Wells Treats Cardholders to Reed Johnston IVR

Dallas-based Intervoice has completed deployment of speech recognition technology for Wells Fargo’s credit-card business. Using the “Omvia Voice Framework”, Wells cardholders are treated to a voice persona, known as “Reed Johnston.” An extensive pilot run during the first half of 2003. Wells Fargo Card Service, in conjunction with Intervoice and Nuance, decided to automate their voice systems from Intervoice housed within call centers in Hillsboro, Oregon, and Des Moines, Iowa, to create a more user friendly IVR. Intervoice has more than 22,000 systems deployed worldwide.

FDC Names HR Chief

First Data has hired Michael D’Ambrose, formerly of Citigroup, as EVP/Human Resources. D’Ambrose brings almost 25 years of experience in the Human Resources field to First Data. First Data Corp. is a leader in electronic commerce and payment services, First Data serves approximately 3 million merchant locations, 1,400 card issuers and millions of consumers, making it easy, fast and secure for people and businesses to buy goods and services using virtually any form of payment.

MBNA Licenses BabyMint Platform from Vesdia

MBNA has inked a multi-year deal with Atlanta-based Vesdia Corporation for a microinvesting platform and loyalty program. The Vesdia program currently powers the “BabyMint” and “NestEggz” credit card programs, both co-branded by MBNA. BabyMint acquired NestEggz in January for $4.5 million cash. MBNA teamed with BabyMint in May 2003 to launch the “BabyMint MasterCard.” MBNA is reportedly looking to expand the program to other affinity and co-branded partners. Vesdia’s microinvesting platform enables individual investors to receive up to a 20% rebate on every-day purchases made through the company’s network of more than 500 retailers and 127,000 grocery stores. According to Financial Research Corporation, merchant and credit card rebates, such as those facilitated by the Vesdia technology platform, have the potential to represent an incremental $1.1 billion per year in assets to banks and investment management firms. (CF Library 1/30/03; 3/21/03)

UK Rail Industry Gets New Settlement System

Britain’s passenger train operators and SchlumbergerSema have completed development and implementation of the settlement system for the UK rail industry. Code named “LENNON” (Latest Earnings Networked Nationally Over Night), it is one of the world’s largest ever transport settlement systems capable of handling and allocating more than GBP 3.5 billion in annual passenger revenue to Britain’s passenger train operators.
“LENNON” also provides valuable marketing and customer-related data on 300 million annual ticket sales and usage patterns enabling train operating companies to better plan rail services to ensure that high levels of customer service are maintained at all times.

Experian Picks Up Two More Bureaus

Experian has acquired Advantage Credit Bureau of Fargo, North Dakota and Credit Bureau of East. Experian’s network of affiliate credit bureaus provides clients in specific geographic areas with a variety of services utilizing the company’s consumer credit, business, automotive and marketing information. Experian acquired the consumer operations of Credit Bureau of East Tennessee, which provides services in Knoxville, and Morristown, Tenn.

Life Insurance Corporation of India and Capital One May Team

The Life Insurance Corporation of India is reportedly in talks with Capital One to issue a debit card in the country. The insurance concern also fielded proposals from SBI Card and Corporation Bank, but preferred the Capital One proposal. LIC wants to issue a debit card linked up to its insurance policies. However, the firm wants a competitively priced card. According to the Business Standard, LIC has asked for a waiver of joining fees and annual fees for card holders, plus a reduced rate of interest for cash advances. LIC was asking for rates that were as low as 0.9% to 1.0% per month against the existing rates of 1.9% to 2.2% per month.

Personal Advantage Debit VISA Launched

Los Angeles-based Direct Response Financial Services and Direct Card Services has signed a deal to distribute its VISA pin-based Debit/ATM card on 2,500 Web media outlet partners. The “Personal Advantage” product will be offered at $49.95. The product includes a VISA pin-based Debit/ATM card, with $10 cash on the card, together with a $50 airline credit. The Product will also feature the “Personal Advantage Global Money-Online” Web services.