With new credit-card issuers springing up every week, Barclaycard
could be forgiven for feeling the pressure.
In recent years, its market share has been eroded by new entrants such
as MBNA, Bank One, Egg and Morgan Stanley Dean Witter. Their marketing
strategy, while promoting the individual benefits of their cards,
focuses on letting customers know just how highly priced Barclaycard
How has Barclaycard responded to the threat? The company has allocated
an annual advertising budget of more than pounds 40 million - an
impressive war chest with which to defend its brand.
While Barclaycard offers a number of personal loan services and has been
involved in Cellnet mobile phone giveaways in recent months, it focuses
more than 95 per cent of that pounds 40 million on promoting its credit
Barclaycard’s buying and planning is split between BMP DDB and the
direct marketing agencies Barraclough Hall Woolston Gray and Triangle
The bank uses a wider range of media than any other card issuer, running
campaigns on TV, press, direct mail, cinema, outdoor and loose press
Barclaycard is one of the few card companies to use TV. In May 1999, it
broadcast its first TV campaign since reappointing BMP DDB to its media
Almost 60 per cent of Barclaycard’s TV spend took place in May and
There was a break in July and August, and campaigns in September and
November. More than 30 satellite channels were used, the most popular
being Sky 1, Sky Sports and Sky News. The most popular channels overall
were LWT (pounds 3.1 million), Central (pounds 1.71 million) and Channel
4 London (pounds 1.35 million).
Press advertising is firmly mid-market, with more than half of all press
spend placed with the Daily Mail, The Mail on Sunday, The Express and
Sunday Express. The Daily Telegraph received 12 per cent of the total
press spend and The Sun landed 10 per cent.
Barclaycard used loose press inserts extensively in 1999, with frequent
insertions in Radio Times, TV Times, Cosmopolitan, OK!, Loaded and other
special interest magazines.
So what for the future? Barclaycard has already reacted to its rivals by
changing its price positioning. It has cut rates from an average 21.9
per cent APR a year ago, to the current introductory rates of 5.9 per
cent. It has also launched lower-priced products with features such as
permanently low balance transfer rates.
More rate offers and product launches can be expected, given that
Barclaycard’s market share has fallen to 28 per cent from 32 per cent in
But with competition among UK card issuers showing no signs of abating,
it looks as if Barclaycard will have its work cut out to defend its
Research by AC Neilsen MMS tel: 01344-627553 www.mediamonitoring.com.