The U.S. Market for Plastic Payment Cards
Jan 1, 1998
322 Pages - Pub ID: LA439
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  1. Executive Summary
    • The Products
    • Six Basic Types of Cards
    • General-Purpose Cards
    • Co-Branded and Affinity Cards
    • Private-Label Cards
    • Debit Cards
    • Corporate Credit Cards and Purchasing Cards
    • Stored-Value Cards
    • The Market
    • Market Nears $1.2 Trillion in 1997
    • Table 1-1: U.S. Market for Plastic Payment Cards, 1993-2002 (dollars):
    • General-Purpose, Corporate/Purchasing, Private-Label, Debit, Stored-Value
    • Total Cards in Use Exceed One Billion
    • Private-Label Is Most Frequently Held Card Type
    • Factors Affecting Market Growth
    • Overall Outlook Positive for All Types of Cards
    • Economic Forecasts Remain Sunny
    • Industrywide Shift to Electronic Payments
    • Cards Represent Buying Power for Consumers
    • For Card Issuers, Plastic Means Profits
    • Various Market Segments Not Saturated
    • Industry Consolidation Enables Strong to Grow
    • Technology and Card Utility
    • Focus on General-Purpose Cards
    • Focus on Private-Label Cards
    • Focus on Co-Branded/Affinity Cards
    • Focus on Corporate/Purchasing Cards
    • Focus on Debit Cards
    • Focus on Stored-Value Cards
    • The Marketers
    • Thousands of Marketers
    • Four Major Payment Card Brands
    • Visa Is Largest Card Association
    • Top 10 Issuers Generate More Than Half of Market
    • Majority of Issuers Share Tiny Piece of Market
    • The Top 10 Co-Branded/Affinity Card Issuers
    • Top 10 Private-Label Issuers Account for 60% of Category
    • Mobil and Chevron Operate Leading Oil Company Programs
    • Leading Corporate/Purchasing Card Issuers
    • Figure 1-1: Market Share of Leading Corporate/Purchasing Card Issuers: By Charge Volume, 1997 (percent): American Express, Visa, Fleet Cards, MasterCard, All Other
    • Visa Check Card Leads in Debit Card Activity
    • Outside of Phone Cards, Few Stored-Value Card Marketers
    • A Volatile, Intensely Competitive Industry
    • Ingredients for Success
    • Blurring of Lines Between Categories
    • Mergers and Acquisitions a Key Strategy for Acquiring Share
    • Globalization of Plastic Payment Industry
    • Major Co-Brand Contracts Due for Re-Bidding
    • Marketing and New Product Trends
    • Co-Branding/Affinity Marketing Remains Strong
    • Many Innovations Come from Private-Label Side
    • Big Card Associations Spent $736 Million in 1996
    • Direct Mail the Predominant Form of Advertising
    • Telemarketing Another Popular Medium
    • Payment Processing
    • Behind-the-Scenes Network Processes Card Transactions
    • Front-Office vs. Back-Office
    • Leading Merchant Acquirers
    • The Consumer
    • Nearly Three-Fourths of Adults Have/Use Credit Cards
    • Cardholders Present an Employed, Modestly Upscale Profile
    • 83% of Cardholders Have Used Cards in Last 30 Days
    • Visa Is Most Popular Card
    • Sears the Most Popular Private-Label Card
    • American Express Most Popular Corporate Card
    • Scope and Methodology
    • Scope of Report
    • Report Methodology
  2. The Products
    • Types of Plastic Payment Cards
    • Six Basic Types of Cards
    • General-Purpose Cards
    • Co-Branded and Affinity Cards
    • Private-Label Cards
    • Debit Cards
    • Corporate Credit Cards and Purchasing Cards
    • Stored-Value Cards
    • Additional Products and Terms
    • Charge Cards
    • Credit Cards
    • Bankcards
    • Secured Cards
    • Payment Systems
    • MasterCard and Visa Payment Systems
    • Issuing Banks
    • Acquirers or Payment Processors
    • Automated Clearinghouse and FedWire
    • General-Purpose Cards
    • Early Credit Cards Were Single-Purpose
    • Introduction of General-Purpose Charge Cards
    • Introduction of General-Purpose Credit Cards
    • Bankcard Growth
    • Co-Branded and Affinity Cards
    • Brief History of Affinity Cards
    • Early Co-Branded Cards
    • Rapid Growth of Co-Branded Cards
    • Comparison of Co-Branded Cards and Affinity Cards
    • Table 2-1: Comparison of Co-Branded Cards and Affinity Cards (5 Factors)
    • Co-Branded Cards Often Segmented by Industry
    • Many Private-Label Cards Convert to Co-Branded Programs
    • Others Start Co-Branded Programs from Scratch
    • Co-Branding Benefits Three Constituencies
    • Consumer Benefits
    • Bank Benefits
    • Co-Brander Benefits
    • Private-Label Cards
    • History of Private-Label Cards
    • Corporate Credit Cards and Purchasing Cards
    • Brief History of Corporate Credit Cards and Purchasing Cards
    • Visa and MasterCard at First Cool to Idea
    • How Purchasing Cards Work
    • Benefits to Users: Slashed Costs
    • Benefits to Suppliers: Faster Payment
    • Benefits to Banks: Profit and Relationships
    • New Types of Purchasing Cards
    • Debit Cards
    • The History of Debit Cards
    • Two Types of Debit Cards
    • But Distinctions Now Largely Irrelevant
    • Benefits to Users
    • Benefits to Banks
    • Benefits to Merchants
    • Stored-Value Cards
    • History of Stored-Value Cards
    • The Vision of a Cashless Society
    • The U.S. Delays in the 1980s
    • U.S. Begins to Embrace Electronic Commerce in the 1990s
    • SVCs the Catalyst to Electronic Commerce
    • 1996: A Crucial Year for SVCs
    • SVC Technology, Simplified and Explained
    • Magnetic Stripe Cards
    • Integrated-Circuit (IC) Chip Cards
    • Hybrid Cards
    • Microprocessor Chip Cards
    • "Contactless" Cards
    • Disposable versus Rechargeable Cards
    • On-Line versus Off-Line Systems
    • On-Line Advantages and Disadvantages
    • Closed Systems versus Open Systems
    • The SVC Account Pool
    • Mechanics of SVC Use
    • The Mechanics of Recharging
    • Denominations
    • Manufacturer Costs
    • Fee Structure: Merchants
    • Fee Structure: Consumers
    • On the Brink of Monetary Revolution?
    • Monetary Issues
    • Regulatory Issues
    • A Return to 19 th Century "Free Banking"?
    • SVCs an Alternative to Petty Cash
    • A "Pay-Before" Option
    • The Difference Between SVCs and Debit Cards
    • SVCs versus Smart Cards
    • SVC Transactions versus Smart Card Interactions
    • The Distinction Between Services and Applications
    • Single-Application, Multiple-Service Cards
  3. The Market
    • Figure 3-1: Estimated U.S. Market for Plastic Payment Cards, 1993-1997 (dollars)
    • Market Size and Growth
    • Market Nears $1.2 Trillion in 1997
    • Market Has Grown 93% in Last Five Years
    • Table 3-1: Estimated U.S. Market for Plastic Payment Cards, 1993-1997 (dollars): General-Purpose, Corporate/Purchasing, Private-Label
    • Debit, Stored-Value
    • General-Purpose Receivables Near $474 Billion
    • Table 3-2: Growth in General-Purpose Card Receivables, 1993-1997 (dollars)
    • Purchasing Cards Drive Commercial Card Volume
    • Private-Label Cards Post Double-Digit Growth as Well
    • Debit Cards Take Hold
    • SVC Card Use Doubling Every Two Years
    • Payment Industry Revenues Estimated at $127 Billion Annually
    • Market Composition
    • Total Cards in Use Exceed One Billion
    • Table 3-3: Number of Plastic Payment Cards in Circulation, 1997 (number): Private-Label, General-Purpose, Debit, Corporate/ Purchasing
    • Private-Label Is Most Frequently Held Card Type
    • Visa Leads in Co-Branded Cards
    • Table 3-4: Estimated Number of Co-Branded/Affinity Cards: Top Three Issuers, 1997 (number): Visa, MasterCard, American Ex-press
    • Factors Affecting Market Growth
    • Overall Outlook Positive for All Types of Plastic Payment Cards
    • Economic Forecasts Remain Sunny
    • High Level of Consumer Debt Expected to Peak in 1996
    • Table 3-5: Total Consumer Debt as Percentage of Personal Disposable Income, 1991-1997
    • Interest Rates Also Affect Card Use
    • Industrywide Shift to Electronic Payments
    • Shift to Direct Payments Will Change Banking Fees
    • Cards Symbolize Relationships
    • Cards Represent Buying Power for Consumers
    • Consumers Continue to Take On More Debt
    • Credit Represents One-Half of Retailer Sales Volume
    • For Card Issuers, Plastic Means Profits
    • Plastic Increasingly Offers Benefits Consumers Want
    • Various Market Segments Not Saturated
    • Marketing Programs Affect Rate of Growth
    • Industry Consolidation Enables Strong to Grow
    • Legislation and Regulation
    • Federal Mandates Will Speed Transition to Electronic Commerce
    • Computer Modeling, Risk Assessment, and Market Segmentation
    • Technology and Card Utility
    • Focus on General-Purpose Cards
    • Competition from Other Payment Forms
    • Overall Outlook Positive
    • Focus on Private-Label Cards
    • Focus on Co-Branded/Affinity Cards
    • Focus on Corporate/Purchasing Cards
    • Business Market Not Saturated
    • Plastic Reduces Costs and Boosts Efficiency
    • Reengineering Trend Boosts Purchase Card Use
    • Better Things to Do with Human Resources
    • Technology and Merchant Acceptance
    • Market Segmentation Another Growth Factor
    • Focus on Debit Cards
    • Near Universality of Debit Card Acceptance
    • Debit Cards Reduce Cost of Check Processing
    • Retailers Challenge Interchange Fees
    • Per-Check and ATM Fees Encourage Debit Card Use
    • Corporate Debit Card Prospects
    • Concerns About Security
    • Focus on Stored-Value Cards
    • Positive Factors: Convenience
    • Speedier Transactions
    • SVCs Offer Savings
    • Novelty/Fad Appeal
    • Technological Momentum
    • Infrastructure/Standards Under Development
    • The Evolving Nature of SVCs
    • Demographic Trends Bode Well
    • SVCs Compatible with Certain Industries
    • Benefits for Merchants
    • Benefits for Banks/Issuers
    • Market Stimulated by Advertising and Promotion
    • Visa's 1996 Summer Olympics Rollout
    • Globalization of the Economy
    • Obstacles: Consumer Financial Disadvantages
    • Overcoming Credit/Debit Card Advantages
    • Merchant Resistance to Investment
    • Is Skepticism Over Infrastructure Development Overblown?
    • How Profitable Will SVCs Really Be?
    • Charging Merchant Fees
    • Fee Skeptics
    • Making Money Off the Float
    • Skeptics on Bank Streamlining
    • Figure 3-2: Projected Growth of U.S. Market for Plastic Payment Cards, 1997-2002 (dollars)
    • Projected Market Growth
    • Market to Approach $2.4 Trillion by 2002
    • Table 3-6: Projected Growth of U.S. Market for Plastic Payment Cards, 1997-2002 (dollars): General-Purpose, Corporate/Purchasing, Private-Label, Debit, Stored-Value
  4. The Marketers
    • Figure 4-1: Estimated Share of General-Purpose Consumer Card Market: By Marketer, 1993 vs. 1997 (dollars)
    • Marketer and Brand Shares
    • Thousands of Marketers
    • Four Major Payment Card Brands
    • Visa Is Largest Card Association
    • Table 4-1: Estimated Share of General-Purpose Consumer Card Market: By Marketer, 1990-1997 (dollars): Visa, MasterCard, American Express, Discover
    • Top 10 Issuers Generate More Than Half of Market
    • Table 4-2: Top 10 General-Purpose Consumer Credit Card Issuers: By Receivables, 1997 (dollars and percent)
    • Top 10 Card Issuers Nearly the Same by Number of Accounts
    • Table 4-3: Top 10 General-Purpose Consumer Card Issuers: By Number of Accounts, 1997
    • Majority of Issuers Share Tiny Piece of Market
    • Figure 4-2: Market Share of General-Purpose Consumer Card Receivables: By Issuer Ranking, 1997 (percent): Top 10 Issuers, 11-25, 26-50, 51-100, 101-300, and All Others
    • Leading Card Issuers Listed
    • Table 4-4: Top 51 General-Purpose Consumer Card Issuers: By Total Accounts, 1997
    • The American Express and Visa Debate: Which Card Is Accepted at More Locations?
    • Different Group of Issuers Lead in Secured Cards
    • Table 4-5: Leading Secured Consumer Card Issuers: By Number of Cards Issued, 1996 (number): 25 Issuers
    • Co-Branded/Affinity Cards Growing as Percent of General-Purpose Cards
    • The Top 10 Co-Branded/Affinity Card Issuers
    • Table 4-6: Top 10 Co-Branded Card Issuers and Estimated Market Share, 1997 (number and percent)
    • AT&T Remains Largest Co-Branded Card Issuer
    • But MBNA Often Thought of as Co-Branding King
    • Household Credit Services
    • Citicorp Boasts Two Giant Co-Branded Programs
    • Banc One and First USA Field More Than 1,000 Programs
    • The Chase Manhattan Corp.
    • First Chicago NBD Corp
    • NationsBank
    • GE Capital Consumer Card Co
    • First National Bank of Omaha
    • Other Leading Co-Branders
    • Top 10 Private-Label Issuers Account for 60% of Category
    • Table 4-7: Top 10 Private-Label Retail Card Issuers and Estimated Market Share, 1997 (dollars and percent)
    • Sears the Leader
    • GE Capital Retailer Financial Services
    • Household Retail Services
    • JCPenney Co., Inc.
    • Beneficial National Bank USA
    • Banc One Private-Label Credit Services
    • Federated Department Stores
    • May Department Stores Co
    • SPS Transaction Services, Inc.
    • Dayton Hudson Corp.
    • Mobil and Chevron Operate Leading Oil Company Programs
    • Table 4-8: Leading Private-Label Oil Company Card Issuers: By Total Number of Accounts, 1997 (number and dollars): Top 15 Issuers
    • Leading Corporate/Purchasing Card Issuers
    • Table 4-9: Leading Corporate/Purchasing Card Issuers: By Estimated Number of Cards, Charge Volume, and Market Share, 1997 (number and dollars): 6 Leading Issuers Nine Leading Corporate Bankcard Issuers
    • Table 4-10: Leading Bankcard Issuers of Corporate/Purchasing Cards, 1997 (number): 9 Issuers
    • Another 30 Issuers Have 10,000 Cards or More
    • But Bankcard Issuers Not the Only Players
    • Fleet Cards a Type of Purchasing Card
    • Visa Check Card Leads in Debit Card Activity
    • Table 4-11: Growth in Debit Card Activity: Visa vs. MasterMoney, 1990-1997 (number, dollars, and percent)
    • Yet Largest Debit-Card Marketers Issue More Private-Label Debit Cards
    • Table 4-12: Top 10 Debit Card Issuers: By Type of Card, 1997 (number) Leading Visa Check Card Issuers
    • Table 4-13: Leading Visa Check Card Issuers, As of January 1997
    • Leading MasterMoney Issuers
    • Table 4-14: Leading Issuers of MasterMoney Debit Cards, As of January 1997 (number): Top 20 Issuers
    • Outside of Phone Cards, Few Stored-Value Card Marketers
    • Visa, MasterCard, and EPS
    • Banks and System Suppliers
    • Table 4-15: Major Stored-Value Card System Suppliers in the United States (11 Suppliers)
    • Competitive Overview
    • A Volatile, Intensely Competitive Industry
    • Ingredients for Success
    • Consumer Credit Market Is Saturated
    • Saturation Pushes Issuers to Develop New Markets
    • Blurring of Lines Between Categories
    • Mergers and Acquisitions a Key Strategy for Acquiring Share
    • Three Companies Have Been Most Active Acquirers
    • Smaller Issuers Find It Increasingly Difficult to Compete
    • Globalization of Plastic Payment Industry
    • Major Co-Brand Contracts Due for Re-Bidding
    • Competitive Profile: Visa USA
    • Visa the Largest Bankcard Association
    • Strategy Is to Grow Market Rather Than Compete for Existing Share
    • Visa Battles American Express Over Ban on Competing Cards
    • Visa and MasterCard Match Programs
    • Visa Helps Members Compete for Corporate Card Market
    • Visa Active in Smart Card Development
    • Competitive Profile: MasterCard International
    • MasterCard Is Second-Largest Association
    • New CEO to Help Company Focus on Global Market
    • Strategy Built on "Four Pillars"
    • MasterCard Switches Ad Agencies
    • MasterCard Has Produced Some Creative Plastic Promotions
    • MasterCard Breaks Rules on Co-Branded Corporate Card with British Airways
    • Mondex and Smart Cards
    • Competitive Profile: American Express
    • American Express in Third Place and Moving
    • The Leader in Corporate/Purchasing Cards
    • A Change in Philosophy
    • Develops Co-Branded Credit Cards
    • Changes to Become More Competitive
    • Moves Aggressively to Challenge Visa and MasterCard
    • American Express Courts Banks for Two Reasons
    • Looking for Global Issuers
    • American Express Strong in Financial/Travel Services
    • Strikes Deal with Wright Express
    • Increasingly Aggressive Advertising
    • AmEx Develops Sports Marketing Portfolio
    • Seinfeld Commercials a Hit
    • Competitive Profile: Discover
    • The Largest Card Issuer by Accounts
    • Fourth-Largest by Charge Volume; Third-Largest by Receivables
    • Dean Witter Diversifies Card Offerings in 1994
    • New Cards Issued in 1996 and 1997
    • Merger with Morgan Stanley in 1997
    • Competitive Situation: General-Purpose and Co-Branded Cards
    • Competition Most Intense in General-Purpose Category
    • Despite Consolidation, Bankruptcies, Competition, Most Issuers Survive
    • Bank Issuers Face Competition from Specialty Shops
    • Card Issuers Compete Against Other Forms of Payment
    • Mergers Reorder Ranking of Top 10
    • Eighth-Place AT&T Rocks Card Industry by Calling It Quits
    • Termination of Ford and AT&T Programs Spells Out Dangers in Co-Branded Cards
    • Competitive Profile: Citicorp
    • The Largest General-Purpose Card Issuer
    • Citicorp Offers Number of Enhancement Packages
    • Citibank Photo Card a Free Security Measure
    • Citicorp Among the Largest Debit Card Issuers
    • Citicorp Is Second-Leading Issuer of Visa-Branded Corporate Cards
    • Also Offers Private-Label Card Programs
    • Citicorp Processes Its Cards In-House, but Sold Its Merchant Processing Business
    • Citibank Targets College Students
    • Ford Terminates Co-Branding Agreement with Citicorp
    • Citibank Keeps Tabs on Smart Cards
    • Competitive Profile: MBNA Corp
    • MBNA America Is Second-Largest Card Issuer
    • A Monoline "Specialty" Bank
    • The Affinity King.
    • MBNA Scores with Platinum Plus Card
    • Company Continues to Pursue New Accounts
    • MBNA Diversifying Into Other Financial Services
    • Competitive Profile: Chase Manhattan Corp.
    • The Fourth-Ranked Issuer
    • Chase Operates Eight Co-Branding Programs
    • Chase Offers Generic Flights Rewards and Retail Regards Programs
    • Chase Active in Commercial Card Market
    • Chase Purchases Bank of New York's Credit Portfolio
    • Competitive Profile: First USA, Inc
    • A Fast-Growing Card Specialist
    • Also One of Leading Co-Branders
    • First USA Takes Over Management of Banc One's Card Programs, Gains Branch Distribution Network
    • Introduces Many New Products
    • Combination Credit/Calling Cards
    • New Co-Branded Cards with TicketMaster, Honda
    • Even a Card for Homebuyers
    • Spins Off First USA Paymentech; Strikes Deal with First Data
    • Competitive Profile: Household Credit Services
    • The Sixth-Largest Card Issuer
    • Forays Into Commercial Cards
    • Growth Through Acquisition
    • Competitive Profile: First Chicago NBD Corp.
    • Ninth-Largest Bank Is Seventh-Largest Card Issuer
    • Competitive Profile: AT&T Universal Card Services Corp
    • Telecommunications Giant Is One of Most Successful Co-Branders
    • But Opts Out of the Business
    • Competitive Profile: American Express Centurion Bank
    • Third-Largest Card Issuer Falls to Ninth Place in Receivables
    • Competitive Profile: Advanta National Bank USA
    • Specialty Bank Abandons Credit Card Business
    • Competitive Situation: Private-Label
    • Private-Label Cards Compete Against Other Types of Cards, Not Each Other
    • Private-Label Providers Do Compete with Each Other
    • Card Processors Move Into Private-Label Business
    • Competitive Situation: Corporate/Purchasing Cards
    • Three Associations and Several Independent Players Compete
    • Competition for a Largely Untapped Market
    • Cost Savings Given; Competitors Focus on Ease of Use and Value of Information.
    • Perks and Bonus Programs Being Added
    • Hefty Annual Fees Characterize Programs
    • But Market Is Not for Everyone
    • Attracts Non-Bank Players
    • Competitive Trends in Fleet Card Segment
    • Competitive Profile: American Express
    • The Acknowledged Leader
    • Competitive Profile: U.S. Bancorp
    • From First Bank to U.S. Bancorp to U.S. Bank
    • The Largest Commercial Bankcard Issuer
    • Success Attributed to Size, Economies of Scale, and Stability in Other Businesses
    • Products Tailored to Size of Company
    • Company Expands Corporate Travel Program
    • Teams with International Automated Energy Systems to Offer Fleet Card
    • Competitive Profile: Citicorp
    • Second-Largest Commercial Visa Issuer
    • Competitive Profile: First Chicago NBD
    • The Third-Largest Commercial Bankcard Issuer
    • Competitive Profile: GE Capital
    • The Fourth-Largest Commercial Bankcard Issuer
    • Competitive Situation: Debit Cards
    • Visa and MasterCard Compete for Brand Share
    • Nationally Branded Debit Cards Have Edge Over Private Label
    • Debit Cards Tied to Checking Accounts
    • Competitive Situation: Stored-Value Cards
    • Telephone Companies Out Front in SVCs
    • Other Industries Beginning to Take Interest in Smart Card Development
    • Dilemma Confronts Smart Card Development
    • Visa and MasterCard Compete for Proprietary Standards
    • GCA Calls for Complete Interoperability
    • Banks Moving Slowly
    • Telephone Companies May Catapult Into Lead
    • Competitive Profile: Visa International
    • SVC Commitment Goes Back to 1992
    • Introduces Chip Cards
    • Types and Denominations
    • Mechanics of Visa Card Use
    • Visa's Fee Structure Not Yet Set
    • Visa's Summer Olympics SVC Launch
    • Lessons Learned from Olympics Trial
    • Visa Proceeding with Fall 1997 Roll-Out in New York
    • Visa's SVC TravelMoney Gets Mixed Reviews
    • Competitive Profile: MasterCard International
    • SmartCash: A Major Rollout in 1996
    • MasterCard's Smart Card Strategy
    • MasterCard Seems to Trump Visa
    • Banks Gravitate to SmartCash Consortium
    • MasterCard Maestro Cards in Latin America
    • MasterCard Cash Pilot in Canberra
    • Competitive Profile: Electronic Payment Services, Inc.
    • Owner of the MAC Network
    • Testing SVCs since 1991
    • The Ambitious Open-System Delaware Project
    • EPS Joins SmartCash
    • The Evolving MAC Network
    • Competitive Capsules: Other SVC Players
    • Chemical Bank
    • Citicorp
    • First Union/Jacksonville Jaguars
    • Debitek
    • Danyl Corp.
    • College Programs .
    • Norwest Bank/Northern Colorado University
    • SVC Now Common on College Campuses
    • SVC Vending Machine Operators
    • Vertex
    • ICS
    • Debitek
    • Mars
    • Verifone
    • PVH, Inc
    • NCS (Interactive Technologies, Inc.)
    • Smart Carte
    • Marketing and New Product Trends
    • Co-Branding/Affinity Marketing Remains Strong
    • Airlines the Most Sought-After Co-Brand Partners
    • Generic Frequent Flyer Programs for Issuers Without Partners
    • Activation, Rather Than Acquisition Is Major Focus
    • Card Issuers Penalize Cardholders Who Pay Balances in Full
    • Card Issuers Also Hike Late and Over-Limit Fees
    • Yet Low Interest Rates Key to Revolving Balances
    • The Most Successful Awards Mesh with Customer Goals/Aspirations
    • Exclusive Items May Have Big Draw
    • Card Issuers Offer Other Enhancement Products
    • Cross-Selling Another Strategy
    • But Many Card Issuers Cutting Back on Rewards and Perks
    • Most Reward Incentive Cards Carry Annual Fees
    • "Do-Good" Cards Help People Feel Good About Spending
    • Teaser Rates Still a Draw, But Harder to Find
    • Platinum Cards Attempt to Recapture the Luster Lost by Gold Cards
    • Supermarkets a Primary Target for Plastic
    • Dillons and Bank IV Card Co. Demonstrate Successful Co-Branding in Grocery Environment
    • Yet Many Supermarket Cardholders Don't Carry Balances
    • Secured Cards Avoid Alienating Customers
    • Many Innovations Come from Private-Label Side
    • Consumer Advertising, Direct Mail, and Telemarketing
    • Big Card Associations Spent $736 Million in 1996
    • Most Bank and Private-Label Card Issuers Not Reflected in CMR Esti-mate
    • Television Advertising Dominated
    • Visa Leads Over American Express, Discover, and MasterCard
    • First Half of 1997 Shows Decline
    • Direct Mail the Predominant Form of Advertising
    • Five Issuers Responsible for More Than One-Third of Solicitations
    • Premium Cards Account for Over Half of Direct-Mail Offers
    • Mailings Increase to Non-Pre-Approved
    • Offers for MasterCard Are Up
    • Telemarketing Another Popular Medium
    • Consumer Advertising Positioning and Promotion
    • Functionality a Key Theme
    • Rewards Another Well-Touted Theme
    • Sound Money Management
    • Teaser Rates and Bill Consolidation
    • Support for Worthy Causes
  5. Payment Processing
    • Overview
    • Behind-the-Scenes Network Processes Card Transactions
    • Front-Office vs. Back-Office
    • Merchant Acquirers and Payment Processors Often Overlap
    • Yet One-Stop Shopping Still Not the Norm
    • Payment Processing a Less Risky Means of Profiting from Plastic
    • Mergers, Acquisitions, and Portfolio Sales Shape Competition in this Segment
    • Card Associations Respond
    • Leading Merchant Acquirers
    • Ten Leading Payment Processors
    • Competitive Focus: First Data Corporation
    • Industry Leaders Covers All Processing Aspects
    • Company Active in Seven Business Areas, Five Related to Plastic Pay-ment Cards
    • Domestic Card Issuer Services
    • Domestic Merchant Processing Services
    • International Card Services
    • Payment Instruments Include Fleet Services and Electronic Payments
    • Specialty Services
    • Electronic Bill Presentment and Payment
    • First Data Continuously Grows Its Business by Enhancing Customers' Businesses
  6. e Consumer
    • Ownership and Use of Credit Cards
    • Note on Simmons Market Research Bureau Data
    • Data Presented for Six General-Purpose Cards, Nine Private-Label Cards, Three Corporate Cards
    • Nearly Three-Fourths of Adults Have/Use Credit Cards
    • Table 6-1: Consumer Ownership and Use of Credit Cards by Type, 1996 (number and percent): 19 Types
    • Cardholders Present an Employed, Modestly Upscale Profile
    • Table 6-2: Demographic Characteristics Favoring Ownership and Use of Credit Cards (U.S. Adult Population): Have/Use, Acquired
    • Last 12 Months, Used Last 30 Days/12 Months 83% of Cardholders Have Used Cards in Last 30 Days
    • Visa Is Most Popular Card
    • Sears the Most Popular Private-Label Card
    • American Express Most Popular Corporate Card
    • General-Purpose Cardholders: By Brand
    • Visa Cardholder Profile Typical
    • MasterCard Cardholders
    • Discover Cardholders Reflect Stability
    • American Express Cardholders Drawn from Corporate World
    • AT&T Universal Cardholder Profile Unique
    • American Express Optima Cardholders
    • Table 6-3a: Demographic Characteristics Favoring Ownership and Use of Credit Cards by Type: General-Purpose (U.S. Adult Popula-tion): Visa, MasterCard, Discover, AmEx
    • Table 6-3b: Demographic Characteristics Favoring Ownership and Use of Credit Cards by Type: General-Purpose (U.S. adult popula-tion): AT&T Universal, American Express Optima
    • Private-Label Cardholders: By Card Type
    • Private-Label Cardholders Present Slightly Different Profile
    • Sears Profile Typical of Department Store Cardholder
    • JCPenney Profile Reflects More Career-Oriented Women
    • Most Upscale Profile Presented by Other Department Store Cardholders
    • Montgomery Ward Cardholder Profile Skews Older, Less Affluent
    • Specialty Retail Cardholders Present Profile of Upscale Female
    • Gasoline Cardholders Also Upscale
    • Air Travel
    • Males Dominate Ranks of Auto Rental Cardholders
    • Hotel Cardholders Also Likely to Be Professional Males
    • Table 6-4a: Demographic Characteristics Favoring Ownership and Use of Credit Cards by Type: Private-Label (U.S. Adult Population): Sears, JCPenny, Other Department Store, Montgomery Ward
    • Table 6-4b: Demographic Characteristics Favoring Ownership and Use of Credit Cards by Type: Private-Label (U.S. adult population): Other Specialty Retailer, Gasoline, Air Travel, Auto Rental
    • Table 6-4c: Demographic Characteristics Favoring Ownership and Use of Credit Cards by Type: Any (U.S. adult population): Hotel
    • Corporate Cardholders: By Card Type
    • Employed Males Are Primary Users
    • American Express Cardholders Present Typical Profile
    • MasterCard Business Cardholders Include Skilled Trades
    • Visa Business Cardholders
    • Table 6-5: Demographic Characteristics Favoring Ownership and Use of Credit Cards by Type: Corporate (U.S. adult population):
    • American Express, MasterCard Business, Visa Business
    • Consumer Use of Plastic Payment Cards at Retail
    • Growth of Plastic Termed "Astronomical"
    • Nearly Half of All Families Have Credit Card Debt
    • Younger to Middle-Aged Heads of Household More Likely to Carry Debt
    • Majority of Cardholders Admit to Carrying a Balance
    • Most Think Americans Use Credit Cards Too Much
    • But Don't Plan to Change Their Ways
    • Card Brand Matters Little to Most Consumers
    • Rewards, Interest Rate Dictate Use
    • Younger Shoppers Rely Less on Credit Cards; More Open to Debit Cards
  7. Appendix I: Examples Of Consumer Advertising And Promotions
  8. Appendix II: Selected Companies And Resources
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