'Tis is the season.

• Author: Montelone, Jim
• Position: Fundamentals: Credit Promotions - Consumer credit

Seasonality is one of the most important factors in the success or failure of any credit product marketing campaign. For example, it's no mystery that consumer demand for credit increases around the holidays.

Since most banks have little or no money in their marketing budget for testing various alternative scheduling strategies, it is important to get it right the first time. For marketers who base their livelihoods on creating successful programs, there is no substitute for experience--either their own or that of a seasoned marketing partner--in preparing mail campaigns that anticipate seasonal demands.

However, understanding the nature of seasonality is only part of the puzzle. Just as important is maintaining tight control of the list generation, creative, and production processes needed to avoid delays that could mean missing a seasonal window--causing dramatically reduced response rates and loss of market share to competitors.

Seasonality and credit demand

There are three periods in the year when loan demand is at its highest--but they are not all equal.

The largest is January to February, as post-holiday bills become due. This is typically the heaviest mailing time of the year for most financial services marketers (for good reason).

A second opportunity for credit products occurs from May to June--and it is also the second largest from a potential revenue standpoint. During these spring months, consumers borrow for home improvement projects, vacations, automobiles, recreational vehicles, boats and other items driven by the coming of summer.

The third (and final) credit selling opportunity occurs from September through October, as consumers borrow to pay college and school expenses, and make home repairs and improvements related to the coming winter months. This is the mildest seasonal spike in credit demand--however, it is important because it occurs late in the year when many banks are looking to increase their credit revenues to meet annual targets, using still unspent budget funds to do so.

The spring and fall seasonal opportunities differ from the post-holiday period in that consumers are typically borrowing in advance of (rather than after) the purchase of items that triggered the need for extra funds.

The creative messages needed to take advantage of these three unique credit "windows" varies according to seasonal needs. It is helpful to examine the critical post-holiday period because of its potential for the greatest...