DM led the way in Value Visa launch

An integrated marketing campaign driven by direct mail launched Scotiabank's Value Visa credit card in October 1992.Scotiabank developed the low interest credit card (10.5% interest with a $29 annual fee) - the first Visa card of its kind in Canada -...

An integrated marketing campaign driven by direct mail launched Scotiabank’s Value Visa credit card in October 1992.

Scotiabank developed the low interest credit card (10.5% interest with a $29 annual fee) – the first Visa card of its kind in Canada – after extensive consumer research revealed a significant attitude shift in the marketplace.

Consumers in the ’90s were moving away from the spendthrift ’80s, becoming more conservative, value-oriented and debt-conscious.

Aimed at ‘extenders’

Aimed at ‘extenders,’ the 50% of Canadians who do not pay off their balances every month, Scotiabank designed Value Visa to capture marketshare (and balances) from high interest competitor credit cards.

Attracting new customers to Scotiabank with a price-leading credit card presented the major advertising challenge.

Credit cards generally do not create migration; consumers tend to hold the credit cards of the institutions at which they have their banking business.

And banking relationships are hard to change. Any advertising must overcome an inordinate amount of consumer inertia.

The challenge was met with an integrated advertising campaign developed by BSB Canada, which combined the elements of direct mail, media advertising, sales promotion, public relations and point-of-sale collateral.

A clear product positioning, supported by extensive research, was established early on by the agency and Scotiabank and maintained creatively throughout all elements.

Product concept research conducted at the outset revealed that consumers did not trust the low rate proposition, believing there had to be a catch.

The solution was to position Value Visa as ‘the no-frills credit card which doesn’t give you extras you don’t need or want’ to justify the low rate.

As well, a strong ‘switch’ message was incorporated into all elements via a chart which demonstrated the savings possible to cardholders who carry a balance if they switch to the low interest Value Visa.

The culmination of this switch strategy was a contest encouraging new Value Visa cardholders to switch competitor balances to the new card, thereby prompting immediate activation.

60% of budget

Strategically, direct mail took the lead role in the media mix with 60% of the advertising budget, followed by newspaper (17%), radio (15%), sales promotion (5%), point-of-sale collateral and public relations (3%.)

Direct mail offered several key advantages in this situation.

First, direct mail allowed Scotiabank to cost-effectively target prime prospects for Value Visa, not only from their customer database (25% of total mailings) but also from the outside market via rented mailing lists (75% of total mailings.)

In this instance, mailing lists gave much greater selectivity than general media, enabling Scotiabank to target, for example, active credit card buyers, as well as consumers making lifestyle changes (movers, new homebuyers, new parents) who tend to need credit, among others.

Secondly, because it is personalized, convenient and designed to generate immediate action, direct mail can be more effective than other media in overcoming the inertia that often stalls the financial services decision-making process.

Thirdly, direct mail gave Scotiabank the ability to make different offers to different segments on an individual basis.

Pre-approved status was granted to qualified individuals, a technique that dramatically increases response on credit products. This would not have been possible with mass advertising.

While direct mail strategically served the lead role in the Value Visa launch, the general advertising, however, was no less critical.

This is because direct marketing tends to be more effective when supported by general advertising.

A consumer’s willingness to respond to a direct mail promotion is usually in direct proportion to their familiarity with a company and its products and services.


General advertising can create familiarity, thereby increasing the consumer’s comfort level and propensity to respond.

This explains why customers tend to respond better to direct mail than non-customers.

In the case of Value Visa, the general advertising was a vital component for two reasons.

First, the product concept (low rate card) was new to Canada, and, secondly, the primary target audience was non-Scotiabank customers.

Generating and maintaining a base level of awareness through newspaper and radio advertising (and public relations activities) was key to the success of the direct mail and the program as a whole.


The results of the integrated launch campaign exceeded all expectations, and, in a relatively short period of time, Value Visa has become one of the most successful new products ever introduced by the bank.

Susan Hipp is vice-president and general manager of Kobs & Draft, the direct marketing division of Toronto-based advertising agency BSB Canada.