Visa hopes ad change will charge sales
Credit card companies are feeling the effects of the recession. To get people to swipe more of its debit cards, Visa is launching a new ad campaign that focuses on everyday spending needs. Rico Gagliano reports.
Visa credit cards (Photo Illustration by Justin Sullivan/Getty Images)
More on Spending, America's Financial Crisis
TEXT OF STORY
KAI RYSSDAL: Most or maybe even all industries are feeling the effects of the recession. But credit card companies are caught on the horns of a particular dilemma. Not only do consumers have to spend for them to make money, but we have to use their cards to do it. So, as Marketplace's Rico Gagliano reports, the world's biggest credit card issuer is changing its pitch.
RICO GAGLIANO: For the last several years, Visa's ad slogan was "Life takes Visa." In its commercials, the company often urged consumers to whip out their cards for big, once-in-a-lifetime purchases. Like going to the Olympics. Then, the recession happened. And what do we think of credit now?
MARISSA GLUCK: Credit has become a curse word.
That's Marissa Gluck, a partner at consultants Radar Research.
GLUCK: So Visa needs to tread lightly in this era of economic austerity.
The first "light" step: a new worldwide ad campaign. The ads hitting U.S. TV on Wednesday feature trips to the local aquarium instead of, say, Greece. Antonio Lucio is Visa's marketing chief.
ANTONIO LUCIO: It is all about everyday spending. We're not asking consumers to spend more. We're asking them to use Visa for their everyday needs and wants.
The ads also focus less on credit cards, and more on debit cards. Lucio says the point is that they're easier and safer to use than cash or checks. But consultant Marissa Gluck says it's also a strategy to bring in more money -- just from stores instead of debt-wary consumers.
GLUCK: By using their debit card they're using savings they already have, but Visa still gets to collect fees from merchants. In other words: People don't go into debt, but Visa still makes money.
Gluck says Visa isn't the only credit card company that may be trying to make money off fees instead of consumer debt. She says American Express is now retooling to focus on its original green charge card. The one with an annual fee, that has to be paid off in full every month.
In Los Angeles, I'm Rico Gagliano for Marketplace.
Comments
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03/04/2009
Teach Your Children Well Dept:
"When was the last time you went to the aquarium..."
"....on acid"
haa haa hoho
03/04/2009
So, once again, consumers are buying with money they do not have, and paying extra "someday" for this benefit. And we wonder when we're going to get out of the problem of borrowing and not knowing how we'll eventually pay it back?
I noticed, this story didn't point out, the shopowner also pays, with every credit card purchase. Or how much profit the credit card companies make from late fees. The former can get in the way, the latter can unfortunately help cover lowering the impact of the former.
But again, are credit cards helping the economy rise back up, by creating spending, or are they restricting a rise by not getting us to stop what caused the economy to crash?
From CA, 03/03/2009
Banks set interest rates, not the credit card companies. Point blame in the right direction.
03/03/2009
If they lowered their interest rates from 29 or 35% to be less greedy (considering the fed rate is almost 0%) they might have fewer defaults and alot more business.
Credit card companies that continue to charge over 10% interest have no business being allowed to do so.
Shame on congress, the fed and the regulators for letting these greedy loanshark scumbags continue to charge outrageous fees and interest rates and to get off the hook for their role in the financial crisis. They deserve to go under -- shame on all of them.
From Chicago, IL, 03/03/2009
After hearing this story yesterday, this news of the special American Express edition Maserati was a noticeable contrast.
http://jalopnik.com/tag/2009-maserati-quattroporte-for-centurion/?id=5163456
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