Plastic Surgery

Last year, American Express celebrated the 50th anniversary of its credit card, which went on to take the world by storm. But the celebration came, of course, amid the economic crisis, one in which 63 percent of Americans are spending less overall, according to a recent Harris Poll, and, more painfully for credit card companies, weaning themselves off plastic. Add to this consumers defaulting on payments, and it’s no wonder the credit card industry has been struggling to recoup its losses and sign up new customers. What’s a financial services company to do?

According to marketers like AmEx, it’s to focus on products like charge and debit cards while creating advertising that makes consumers feel they’re still in the driver’s seat. And it’s being done with considerably less media exposure: Measured media spending in the credit card category fell nearly 50 percent in the first five months of 2009 versus the same period last year, according to Nielsen.

The latest company to address the new frugality is AmEx. This month, the company, which in recent years promoted its revolving credit business, is focusing on its core charge card business with a new campaign, “Take charge,” from Ogilvy & Mather. It urges consumers to spend responsibly and emphasizes benefits such as rewards programs and protection services.

“Customers are looking [to be] empowered,” says Deborah Curtis, vp of advertising at AmEx. “The charge card is a pay-in-full product [that] enforces responsible spending and managing … debt.”

This is its first campaign for its charge card business since 2002. It includes TV, print and a Web site,, which asks consumers to share their views on why charge is “the smart way to pay.”

Some companies traditionally associated with credit cards have been promoting their brands with debit card advertising. Visa, for instance, is doing this with its ongoing “More people go Visa” campaign.

(A customer’s financial well-being might not be the only reason for a focus on debit cards. It has been suggested by some financial experts that financial institutions make more money out of charges levied on over-limit debit card purchases than on the interest charges on credit card balances.)

Bank of America’s current advertising from BBDO focuses on the institution’s core savings solutions, including its Keep the Change program that rounds up debit card purchases to the nearest dollar and transfers the difference from customer checking to savings accounts. It also includes the promotion of its Visa credit card, which offers customers reward points. And like other financial institutions, it has introduced a financial management site.

As for Discover Card, it launched a campaign in late August from The Martin Agency — “Get back” (“Now more than ever, it pays to Discover”) — showcasing its cash-back members’ program.

Discover Card’s cash-back focus also marks a return to a signature service. “It’s all about making your money go further,” says Kevin Ragland, associate cd at The Martin Agency. “We wanted to focus on the little things you can get back that maybe you had to give up by using your cash-back bonus. They could be literal things, like a pair of shoes … but we wanted to go a step further and say it’s an emotional thing, you’re getting … your spontaneity back.”

MasterCard has been running ads directing people to a free GPS-enabled iPhone app that helps consumers find deals. “People are spending differently and everything we do has to reflect that,” says Joyce King Thomas, CCO at McCann Erickson and the architect of MasterCard’s “Priceless” campaign.

But getting people to think positively about credit and charge cards in a time of bank bailouts and government scrutiny will continue to be a challenge.

“It’s a love/hate relationship. [Consumers] like their credit cards and think [they’re] essential to their financial lives, but there’s also distrust,” says Ben Woolsey, director of marketing and consumer research at Woolsey adds that there’s a disconnect in consumers’ minds when they see banks getting government assistance, but don’t see it passed on to them.

“There’s a bit of a consumer backlash psychologically,” he says. “But at the end of the day, people like and use their credit cards, and I don’t think that’s going to change.”