Overuse of credit cards is frequently cited as one of the contributing factors for the economic turmoil many consumers find themselves experiencing. Overall, consumers are cutting their reliance on revolving debt. But the U.S. economy still runs on largely on credit and J.D. Power and Associates 2010 U.S. Credit Card Satisfaction StudySM reveals that consumers perceive these companies as ‘financially stable’ and ‘reliable.’
But there’s more to the story. In recent years, high interest rates and other charges have led consumers to look for better deals. The survey found a smaller number of consumers willing to stay with their existing primary card provider. In 2008, 30% of consumers said they would not switch providers. This year, only 22% of consumers won’t switch. This 8% jump in the potential churn rate indicates that marketers need to improve their service levels and marketing efforts.
One way to demonstrate better service would be to engage in plain talk about the new legislation, the CARD Act, that recently become effective. Michael Beird, director of banking services at J.D. Power and Associates, says, “only one-third of cardholders say they ‘completely’ understand their credit card terms.” Marketers should also highlight their offerings on factors that consumers prize. These include rewards, good customer service online and on the phone, and rapid problem resolution.
A shift in marketing campaigns could improve the bottom line for credit card operators.[Source: Satisfaction with Credit Cards Rebounds Slightly. JDPower.com. 19 Aug. 2010. Web. 4 Sept. 2010]