A recent study by a New York-based market research firm says u.s. credit card issuers are dominating card acquisition mailings in both Canada and the United Kingdom.

And the numbers aren’t small. Results of BAI Global’s Mail Monitor study indicate that, for the month of September, American card issuers mbna and Capital One were driving in-Canada credit card mailings, leading the pack by 35% and 30% respectively.

‘The u.s. issuers are being very aggressive with their direct mail,’ says Steve Phillips, associate vice-president, TD Visa card strategy group. ‘It’s really just their overall strategy. They’re very aggressive and they’re putting a lot of money behind it.’

By way of comparison, the of BAI Global study indicated that Royal Bank accounted for a mere 12% of credit card mailings in Canada during the month of September, while cibc accounted for even less, clocking in at 5%.

But Don Lange, senior vice-president at Cornerstone, a Toronto-based list management firm, says he expects the deluge of u.s. mailings to taper off in time.

‘When a mailer starts to mail, they always mail larger quantities because they’re weeding out which lists work well for them and which ones are performing,’ Lange says. He adds that once mailers learn more about the lists they’re utilizing, test those lists and finally segment them, ‘I think we’ll probably see it level off.’

The high volume of u.s. mailings can be explained in part by the fact that u.s. issuers, without benefit of bricks-and-mortar operations in this country, have only one avenue – direct mail – to use in their quest to capture new Canadian customers.

‘It’s really the only channel they’re using,’ says Phillips. ‘We have other channels like using our branches and telephone banking and Web banking as ways of getting applications in.’

But he goes on to say that the influx of u.s. credit card mailings is only in its infancy right now.

‘I think this is just the start,’ says Phillips, who speculates that if Canadians are currently accustomed to receiving one credit card mailing from a u.s. card issuer per week, that number could soon rise to as many as five per week.

One industry insider, who asked not to be identified, says the number of pieces coming from u.s issuers are in the ‘big millions’ a month. Asked whether American card issuers could pose a threat to Canadian credit card issuers, he says: ‘I would expect so. We didn’t have a u.s.-based credit card in this country two years ago, and all of a sudden, two players represent over half of the mailings in the country.’

In light of this flurry of activity from u.s. card issuers, what are Canadian banks doing to protect themselves?

Well, they’re counting on the fact that u.s. issuers are offering Canadians only simple, basic cards with low interest rates, and few other benefits, says Phillips. But they’d also been counting on the banking industry mergers to strengthen their hand.

‘Certainly one of the benefits of the merger, had it gone forward, would be that we would have had a much larger scale, even on the credit card business and it would have given us better protection,’ says Phillips.

He says that although td hasn’t seen ‘a large hit’ on its customer base, u.s. issuers could make ‘a significant inroad into the Canadian marketplace.’ To protect its territory from big American competitors, Phillips says td is beefing up its card products and refining its direct marketing efforts.

Asked to gauge the response of the Canadian financial services industry to the volume of u.s. card issuer mailings, Cornerstone’s Lange says it’s hard to say.

‘I haven’t seen any decrease in mailings from Canadian credit card companies. If anything, I think they’re stepping up their mailings and introducing new cards.’

Which is precisely what TD Visa has done recently.

‘The type of cards that we’ve recently launched, like the Wal-Mart card and the Harley Davidson card have very strong offers and loyalties,’ says Phillips.

Asked whether increased activity on the part of the Canadian banks is in response to u.s. activity, Lange says ‘I think the market has been expanded a little bit, but there seems to be no end to the thirst for credit cards in Canada.’

And, are u.s. banks reaping he rewards of mailing to Canada?

‘Well, they keep coming back,’ says Lange. ‘I certainly see them mailing huge quantities all the time, month after month.’