We’ve chronicled the growth of credit card sales over the Web during the past several years. The market didn’t take off until 1998 when NextCard and First USA launched high-profile online applications and marketing programs . Now, researchers estimate that 500,000 or more card accounts are generated online each quarter (Table 2 & 4). NextCard, consistently one of the Web’s largest online advertisers, draws more than 4 million unique visitors to its Web site each month, the highest total for any financial services provider, and more than the next two issuers, Discover Card and First USA combined (Table 1). Although NextCard has only been converting 4 out of every 1,000 visitors into new accounts, its upcoming secured card program will allow far more consumers to be eligible for a NextCard. As for the industry as a whole, Forrester estimates that the online channel will account for 6% of card loans originated in 2000, rising to 16% in 2003 (Table 2).

Table 1

Web Traffic at Top 12 Credit Card Issuers

unique monthly visitors (thousands)

Source:  PC Data Online www.pcdataonline.com ; Gomez Advisors Spring 2000 Credit Card Scorecard, rank among 17 card issuers www.gomez.com , 5/00; n.r.=not rated

¹accountonline.com is Citibank’s consumer statement access site, these figures do not include traffic at www.Citibank.com  or its business card statement access site

Table 2

number of accounts in millions, dollars in billions

Source: Forrester Research, 1999

Table 3

share of cards issued through online marketing, first half 1999

Source: Brittain Associates, 1999

Table 4

Q3 1999

Source: Piper Jaffray, 1/00; company reports

*Piper Jaffray estimates

Table 5

Credit Card Acquisition Costs

Source: R. K. Hammer, Thousand Oaks, CA

Table 6

unique monthly visitors

Source: Cyber Dialogue 12/99, American Internet User Survey of 1,000 Internet users and 1,000 nonusers; part of the Cybercitizen Continuous Advisory Service

Table 7

millions of users

Source: Cyber Dialogue 12/99, American Internet User Survey of 1,000 Internet users and 1,000 nonusers; part of the Cybercitizen Continuous Advisory Service