Paperless statements, paperless pitches.
US banks and credit issuers spent $13.4 billion in 2007 on direct marketing advertising, generating $178.8 billion in sales, according to the recently-issued Direct Marketing Association (DMA)'s "Direct Marketing Facts and Figures in the Financial Services Industry" report.
The DMA said direct marketing financial services ads will drive $286.2 billion in sales in 2012.
"Financial institutions are relying more and more on multichannel direct marketing to sell services and products to current and prospective customers," said Anna Chernis, senior research manager for the DMA.
"In fact," Ms. Chernis said, "DMA found that the financial, banks and credit institutions sector in 2007 was the number one American industry spending on direct marketing, and it ranked second in sales."
The DMA predicted that financial services commercial e-mail ad spending would grow 22.5% from 2007 to 2012, more than spending on any other media type.
During the same period, spending by the sector on Internet direct marketing ads was projected to grow by 17.8%.
What types of offers work best?
"The most common marketing ploy in the banking industry is to offer either higher interest rates or lower fees than the bank down the street," said Lisa Phillips, senior analyst at eMarketer.
More than half of respondents and panelists surveyed last April told comScore they would open an online account in order to receive $100. Only 13% said they would be swayed by a 6.5% interest rate on new deposits.
Offers of free credit reports, iPod shuffles and no-fee ATM use for the first year each garnered only single-digit enthusiasm, between 8% and 9%.
Forrester Research has also said that financial services providers that do not charge for online bill payment should promote that fact.
The company said in its “Five-Step Action Plan to Help Banks Compete with Biller Sites for EBPP Users" report that more than 40% of online consumers thought their banks charged for online bill payment. That is despite the fact that almost all major banks have dropped the fee in recent years.