Card Marketing for 2013 Turn Your Program into a Revenue Machine

1. Scott Broughton Senior Vice President, ICBA Bancard Scott.Broughton@icba.org Card Marketing for 2013Turn Your Program into a Revenue Machine

2. Agenda Highlights of the New Manual How to use it Using the Manual for creating a marketing plan Additional Resources Questions?

3. Why Create Manual? Repository for Best Practices/Strategies Original Manual was produced in 1995 with several updates over the years ICBA Bancard specific for client banks Community bank friendly Suitable for new and established programs Features best practices and case studies Provides benchmarks for portfolio optimization

4. www.icbabancard.org

5. Log In Click on “Request Site Access” from home page

6. How to access to the Manual • From www.icbabancard.org: • Resource Tab • Quick Links • Recent News Section

7. Access to the Manual, con’t www.icbabancard.org/marketingmanual

8. Marketing Manual – How to use it

9. Navigating the Manual Save the Manual in Adobe PDF

10. Navigating the Manual • Navigation made easier using: • Section headings • Hyperlinks • Glossary • Extra reference materials

11. Hyperlinks

12. Hyperlinks Other passwords required on sites outside ICBA Bancard

13. Hyperlinks

14. Steps in Card Marketing • Assess your Card Program as it is today • Program Development and/Reevaluation • Product Development • Acquisition, Activation, Usage and Retention • Best Practices

15. Ask Yourself Are you carrying one of your bank’s credit cards today? If not, why aren’t you? Community Bank

16. Assessing your Program • Step back and look at your current program • Is it growing? By Accounts? • By Outstandings? Sales Volume? Use ACE. • Is your pricing competitive? APRs? Fees? • Do you have the right product mix to • meet the needs of your customers, • both consumer and business?

17. Sample Competitive Gap Analysis • Other Banks • Credit Unions • Your Mail box

18. Program Development Sample checklist

19. So, what’s next? • How does your program stack up? • What areas do you need to improve?

20. Scenario One “Our card portfolio is flat and we are not adding many new accounts. We need to bring in more accounts or our program will not be profitable”

21. Acquisition Channels – Section 5

22. Your Branches • Train your front line staff about your card products. • APRs, fees, loyalty programs/other enhancements, • business cards • Calling officers should be trained too • Staff meetings should include cards on the agenda! • Branch signage about your card products. Do your • customers know about your card products when they walk • into a branch or when they visit your website? • Applications readily available to be completed

23. Visa Study In at 2012 research study, most community banks Customers surveyed were not carrying a card from their bank because they were not aware their community bank had a credit card. 85% said they would consider a card from their bank

24. Other Acquisition Channels • Pre approved Direct Mail • Website and Bill Pay sites • Social media • DDA Statement Inserts • Promotions and other campaigns. • Emails • Community events

25. Scenario Two “Our bank has added a lot of new accounts in recent years but our cardholders are not using our card”

26. Activation, Usage & Retention – Section 6 Account Acquisition Activation Usage Retention

27. Activation, Usage & Retention • Basic Customer Facts: • 80/20 Rule. Some even say 90/10 is the norm today • Long-term customers have higher spend rates and • higher retention rates • More products mean a greater likelihood of loyalty • and profitability

28. Activation • Send welcome kit or letter to all new cardholders. • Stress features and benefits of the card and remind • about card activation. • Monitor inactivity reports. Call cardholders who have • not activated their cards. • If using ScoreCard, offer points for first usage of card.

29. Usage • For never actives or not active for six or more months. • Send reminder notices about the value of your card. • High users that have shown loyalty. Most profitable but • don’t ignore. • Low to medium users represent the best opportunity to • increase usage.

30. Usage • Factors that drive usage: • Credit Lines – are you providing your cardholders with • adequate lines of credit? • Major Life Events – marriage, new home, college, retirement • Key Seasonal Events – Back to school, vacations, holidays. • Recurring Payments – good way to lock in a cardholder.

31. Retention • If offering rewards (ScoreCard), remind cardholders of the • benefits. • Other enhancements. • Travel Accident Insurance - $150,000 coverage for all • accounts. • Customer service. Your customers already have accounts • at your bank. As a cardholder, they can rely on that same • good customer service.

32. Retention • Look for warning signs: • Requests for balance payoff • Questions about rates, terms, rewards, etc. • Unsatisfied cardholder about a problem resolution. Five Key Reasons of Attrition Increasing pay-down rate – why? Decrease usage – Why? Intro rate expiring Promotional rate expiring Annual Fee

33. Scenario Three “What are other banks doing to promote and grow their credit card programs?”

34. Best Practices – Section 7 • Proven strategies used by other banks. • Links to documents and other websites that will provide • valuable information including bank case studies. • Email, website and social media strategies.

35. Located in-document and on the Manual’s landing page Reference Tools, con’t

36. Turn-key Communications Customizable: Letters Surveys Spreadsheets

37. Questions? Contact our Client Services team at: (800) 242-4770 bancard@icba.org