Private Label Credit Cards in the U.S., 7th Edition
Interesting times are ahead, according to the Packaged Facts report, Private Label Credit Cards in the U.S., 7th Edition. As America continues to struggle with an economy in hyper-flux, the private label card industry has stabilized the free-fall seen in the 2007-2010 period, setting the stage for future growth. With essentially all portfolios now being managed by third parties, improved credit quality and declining charge-offs, and indicators that consumer retail sales are picking up, issuers and retailers are focusing on their respective strengths moving forward.
There will still be hiccups in a return to growth but Packaged Facts forecasts receivables for private label card programs to reach $152 billion by 2015. While not to the levels seen pre-recession of $156 billion in 2007, the market should be cautiously optimistic. The future will still see many challenges but hopefully the good kind—such as how to integrate mobile technologies in to private label programs.
Aside from tracking receivables on an annual basis, to put the market in better context, several new metrics have been included to Private Label Credit Cards in the U.S., 7th Edition. These include:
There will still be hiccups in a return to growth but Packaged Facts forecasts receivables for private label card programs to reach $152 billion by 2015. While not to the levels seen pre-recession of $156 billion in 2007, the market should be cautiously optimistic. The future will still see many challenges but hopefully the good kind—such as how to integrate mobile technologies in to private label programs.
Aside from tracking receivables on an annual basis, to put the market in better context, several new metrics have been included to Private Label Credit Cards in the U.S., 7th Edition. These include:
- U.S. General Purpose and Private Label Card Purchase Volumes and Share of Total General-Purpose Credit and Debit Card Purchase Volume
- U.S. Private Label Card Usage Among U.S. Adults and Share of Total Credit Usage in the Past 12 Months
- Average Amount Spent per U.S. Adult on Private Label Cards in the Past 12 Months
- Annual U.S. Private Label Card End-of-Period Receivables and Consumer Revolving Credit Outstanding and Share of Total Consumer Revolving Credit Outstanding
- U.S. Private Label Card Purchase Volume and Receivables on Cards by Third-Party Issuers and In-house Issuers by Share of Total Private Label Purchase Volume
- Plus all new extended year-over-year coverage of key players’ individual receivables, retailers most important to the private label credit card market, and a discussion of top trends emerging in a digital marketplace, such as customer service in a YouTube world and the emerging mobile payment technologies.
CHAPTER 1: EXECUTIVE SUMMARY
Scope of Report
Methodology
Private Label Cards Market and Growth
Private Label Card Spending Down 14% in 2010
Large Private Label Programs Suffer the Most
Figure 1-1: U.S. Private Label Card Purchase Volume and Share of Total Credit and Debit Card Purchase Volume, 2006-2010 (in billions of dollars)
Total U.S. Private label Card Receivables
Figure 1-2: U.S. Private Label Card End-of-Period Receivables and Share of Total Consumer Revolving Credit Outstanding, 2006-2010 (in billions of dollars)
Large Declines in Receivables For Many Major Players
Private Label Cards Market Forecast
Table 1-1: U.S. Private Label Card Purchase Volume and Receivables Purchase Volume, 2010-2015 (in billions of dollars)
Factors Affecting Growth
Competitive Landscape
Receivables by Issuer
Table 1-2: U.S. Private Label Card End-of-Period Receivables by Issuer, 2006-2010 (in billions of dollars)
Purchase Volume by Issuer
Table 1-3: U.S. Private label Card Purchase Volume by Issuer, 2006-2010 (in billions of dollars)
Private Label’s Core Retail Categories
Core Retail Group Sales Performance
Figure 1-3: Total U.S. Retail Sales of Core Private Label Card Categories and Share of Total U.S. Retail Sales (Excluding Food Service), 2001-2010 (%)
Top 30 Private Label Card Retailers Accounted for 50% of Core Group Retail
Table 1-4: Top 30 U.S. Private Label Card Retailers by Net Sales, 2009-2010 (in billions U.S. $)
Top Private Label Card Retailers Programs and Their Issuers
The Consumer
61 Million American Adults Have a Private Label Credit Card
Usage Rates for All Private Label Credit Cards Declining
Table 1-5: Year over Year Usage of Selected Credit Card Classifications, Fall 2007-Winter 2011 (percentage of U.S. adults)
Private Label Usage Increases with Age
Twice as Many Women Use Private Label Credit Cards
Private Label Credit Card Usage Higher among Whites and Asians
Higher Income Equals Greater Usage
Smaller households are more frequent users of store cards
Top Demographics of Private Label Cardholders Established, Female and Northeastern
Table 1-6: Indices for Use of Any Private Label Card in Last Month, Select Demographic Characteristics, 2011 (U.S. Adults)
Trends and Opportunities
Cautiously Higher Expectations for Economy Get Dashed
Possibility of Double-Dip Recession
For Private Label Credit Cards, Good and Bad
New Legislation Will Restrict Credit Card Industry
Contract Negotiations and Consumer Offerings Affected by New Regulations
A Happier Credit Consumer Follows
Store Cards as Loyalty Cards
Retaining Happy Customers Key
Customers More Empowered
Older, Richer, Smaller Households Strongest Target Group
Maximize Online Store Card Use
Challenge from Alternative Payments Sector
Payment Options: Easy and Green
Developing New Markets
Fraud Top of Mind
How Mobile Changed Retail
CHAPTER 2: THE MARKET: HIGHLIGHTS
Scope of Report
Methodology
Private Label Card Basics
Major Retailer Benefits: Usable Data and Customer Loyalty
Major Cardholder Benefit: Buying Power
Total Credit and Debit Card Market and Growth
Total U.S. Card Growth Hits Great Recession Bump in the Road
Card Purchase Volume Up 8% in 2010
Card Spending Captures Largest Share of Consumer Spending
Greatest Card Growth Seen in 2007
Slowing Economy Slows Purchase Volume Growth
Figure 2-1: U.S. General Purpose Card Purchase Volume, 2006-2010 (in billions of dollars)
Total Card Purchase Volume Sees Its First Decline
Overall Growth Modest, Penetration Increase Impressive
Private Label Cards Market and Growth
Total U.S. Private Label Card Purchasing
Private Label Card Spending Down 14% in 2010
Large Private Label Programs Suffer the Most
Smaller Programs, Specialty Retailers See Growth
Figure 2-2: U.S. Private Label Card Purchase Volume and Share of Total Credit and Debit Card Purchase Volume, 2006-2010 (in billions of dollars)
Overall Growth Only Seen in 2007
Private Label Card Spending Hit Harder Faster Than General Purpose Cards
Spending Declines Accelerate in 2009
Penetration Rate Falls 2.9 Percentage Points
General Purpose Card Performance Contrast
Table 2-1: U.S. General Purpose and Private Label Card Purchase Volumes and Year-over-Year Percentage Change, 2006-2010 (in billions of dollars)
Fewer U.S. Adults Using Private Label Cards
Figure 2-3: U.S. Private Label Card Usage Among U.S. Adults and Share of Total Credit Usage in the Past 12 Months, 2007-2010 (in millions of U.S. adults)
Average Private Label Card Spending down 15% Since 2007
Figure 2-4: Average Amount Spent per U.S. Adult on Private Label Cards in the Past 12 Months, 2007-2010 (in millions of U.S. adults)
Total U.S. Consumer Revolving Credit Outstanding
Figure 2-5: Total U.S. Consumer Revolving Credit Outstanding, 2006-2010 (in billions of dollars)
Total U.S. Private Label Card Receivables
Figure 2-6: U.S. Private Label Card End-of-Period Receivables and Share of Total Consumer Revolving Credit Outstanding, 2006-2010 (in billions of dollars)
Large Declines in Receivables for Many Major Players
Some Bright Spots among Smaller Issuers in 2010
Receivables Growth at Its Apex in 2007
Recession Accelerates Receivables Decline
Table 2-2: U.S. Private label Card End-of-Period Receivables and Consumer Revolving Credit Outstanding and Year-over-Year Percentage Change, 2006-2010 (in billions of dollars)
Private Label Card Receivables Lose Share Among Total Consumer Card Debt
Total U.S. Third-Party Private Label Card Purchase Volume
Figure 2-7: U.S. Private Label Card Purchase Volume on Cards by Third-Party Issuers and Share of Total Private Label Purchase Volume, 2006-2010 (in billions of dollars)
Total U.S. In-House Private Label Card Purchase Volume
Figure 2-8: U.S. Private Label Card Purchase Volume on Cards In-house Issuers and Share of Total Private Label Purchase Volume, 2006-2010 (in millions of dollars)
Table 2-3: U.S. Private Label Card Purchase Volume by Issuer Type (Third Party, In-house) and Year-over-Year Percentage Change, 2006-2010 (in millions of dollars)
Total U.S. Third-Party Private Label Card Receivables
Figure 2-9: U.S. Private Label Card End-of-Period Receivables Managed by Third-Party Issuers and Share of Total Private Label Receivables, 2006-2010 (in billions of dollars)
Total U.S. In-House Private Label Card Receivables
Figure 2-10: U.S. Private Label Card End-of-Period Receivables Managed by In-house Issuers and Share of Total Private Label Receivables, 2006-2010 (in millions of dollars)
Table 2-4: U.S. Private Label Card End-of-Period Receivables by Manager Type (Third Party, In-house) and Year-over-Year Percentage Change, 2006-2010 (in millions of dollars)
Private Label Cards Market Forecast
Total U.S. Private Label Card Purchasing
Growth in 2011 Down
Snap Back in 2012
Figure 2-11: U.S. Private Label Card Purchase Volume and Share of Total Credit and Debit Card Purchase Volume, 2010-2015 (in billions of dollars)
Table 2-5: U.S. General Purpose and Private Label Card Purchase Volumes and Year-over-Year Percentage Change, 2010-2015 (in billions of dollars)
Total U.S. Private Label Card Receivables
Figure 2-12: U.S. Private Label Card End-of-Period Receivables, 2010-2015 (in billions of dollars)
Table 2-6: U.S. Private Label Card End-of-Period Receivables and Consumer Revolving Credit Outstanding and Year-over-Year Percentage Change, 2010-2015 (in millions of dollars)
Factors Affecting Growth
Economic Factors Weigh Heavily
Job Growth Quality Falters
Consumer Sentiment Plummets
Disposable Income Slowing, Personal Savings Rising
Greater Numbers of Retirees to Spend Less
Private label Card Product Challenges
New Payment Options Pose Increased Competition
Retail Segments Related to the Home to See Delayed Rebound
Certain Channels Losing Customers to General Merchandise Stores, Online Retail
CHAPTER 3: COMPETITIVE LANDSCAPE: HIGHLIGHTS
Private Label Card Issuers
Receivables by Issuer
Citibank Receivables Continue to Shrink
No One to Buy Citibank’s Portfolio
GE Capital Retail Finance Focuses on the U.S.
HSBC Finance Receivables Down 12%
Capital One Buys HSBC, Becomes Private Label Card Powerhouse
JPMorgan Chase Halves Portfolio
Table 3-1: U.S. Private Label Card End-of-Period Receivables by Issuer, 2006-2010 (in billions of dollars)
Table 3-2: U.S. Private Label Card End-of-Period Receivables Percentage Change by Issuer, 2007-2010 (%)
Alliance Data Systems Receivables Rise
Smaller, Independent Issuers Fare Better
Who Will Buy Target’s Program
Target to Go North
Will Nordstrom, Signet Sell Out?
Two Independents, Two Different Card Programs
Nordstrom Potentially Less Risky, Signet Potentially More Profitable
Figure 3-1: Share of U.S. Private Label Card End-of-Period Receivables by Issuer, 2010 (%)
Figure 3-2: Share of U.S. Private Label Card End-of-Period Receivables by Third-Party Issuer, 2010 (%)
Figure 3-3: Share of U.S. Private Label Card End-of-Period Receivables by In-House Issuer, 2010 (%)
Purchase Volume by Issuer
Gas Price Volatility Affects Purchase Volume
Citibank Purchase Volume Down
Alliance Data’s Purchase Volume Rebounds
Target’s Focus on REDCard Lifts Purchase Volume
Cato Fashions Moving Away from Private Label Cards?
Table 3-3: U.S. Private Label Card Purchase Volume by Issuer, 2006-2010 (in billions of dollars)
Table 3-4: U.S. Private Label Card End-of-Period Receivables Percentage Change by Issuer, 2007-2010 (%)
Figure 3-4: Share of U.S. Private label Card End-of-Period Receivables by Issuer, 2010 (%)
Figure 3-5: Share of U.S. Private label Card End-of-Period Receivables by Third-Party Issuer, 2010 (%)
Figure 3-6: Share of U.S. Private label Card End-of-Period Receivables by In-House Issuer, 2010 (%)
Private Label Card Retail
Private Label’s Core Retail Categories
General Merchandise Stores
Building Material Stores
Clothing & Accessory Stores
Electronics & Appliance Stores
Furniture & Home Furnishing Stores
Sporting Goods, Hobby, Book, and Music Stores
Office Supply Stores
Non-Core Retailer Categories
Core Retail Group Sales Performance
Figure 3-7: Total U.S. Retail Sales of Core Private Label Card Categories and Share of Total U.S. Retail Sales (Excluding Food Service), 2001-2010 (%)
Table 3-5: Total U.S. Retail Sales by Core Private Label Card Category, 2006-2010 (in billions of dollars)
Figure 3-8: Share of U.S. Retail Sales by Core Private Label Card Category, 2010 (%)
Ecommerce May Be the Place to Be
Figure 3-9: Total U.S. Retail Sales of Core Private Label Categories Including Ecommerce and Share of Total U.S. Retail Sales (Excluding Food Service), 2001-2010 (%)
Table 3-6: Total U.S. Retail Sales by Core Private Label Category including Ecommerce and Mail Order, 2006-2010 (in billions of dollars)
Figure 3-10: Share of U.S. Retail Sales by Core Private Label Card Category Including Ecommerce, 2010 (%)
Top 30 Private Label Card Retailers
Top 30 Private label Card Retailers Accounted for 50% of Core Group Retail
Figure 3-11: Top 30 Private Label Retailers Total Sales and Share of Core Group Retail Sales, Including and Excluding Ecommerce, 2009-2010 (in billions U.S. dollars, %)
Wal-Mart the Heavyweight, Target a Distant No.2
Costco Quietly Grows
Big Box Store Receivables Trend
Figure 3-12: Total Target Corp. and Wal-Mart, Inc. End-of-Period Receivables: Private Label and Co-Brand Card, 2006-2010 (in billions U.S. dollars)
Home Depot and Lowe’s Are Big Players
Home Depot Private Label Volume Declines Amidst Total Sales Growth
Best Buy Leads Electronic Stores
Figure 3-13: Total U.S. Sales at Home Depot (Private Label Card and All Other) and Private Label Card Share of Total U.S. Sales, 2006-2010 (in billions U.S. dollars)
Table 3-7: Top 30 U.S. Private Label Card Retailers by Net Sales, 2009-2010 (in billions U.S. $)
Issuer Focus: GE Capital’s Retailer Receivables
Wal-Mart’s Receivable Growth Comes from Co-Brand Card, Private Label Flat
JCPenney Receivables Decline 12% from High, Modestly for Period
Declines Concentrated in Lowe’s, Dillard’s
Table 3-8: Selected GE Money Bank Retailer Card Receivables (Securitized), 2006-2010 (in billions U.S. $)
Figure 3-14: Share of GE Capital Retail Financing Securitized Receivables, 2010 (%)
Top Private Label Card Retailers Programs and Their Issuers
Table 3-9: Leading Retailer Private Label Card Programs, 2011
CHAPTER 4: COMPETITOR PROFILES: HIGHLIGHTS
Competitor Profile: Citi Retail Services (Citigroup, Inc.)
Focus on Credit Quality Results in Lower Delinquencies
Profitable Retail Partner Cards Division
Table 4-1: Citigroup, Selected Private Label Credit Card Agreements, 2010-2011
Performance and Outlook
Competitor Profile: GE Capital Retail Finance (General Electric Co.)
GE Capital Scales Down Operations
GE Streamlines U.S. Credit Card Portfolio
New Accounts and Account Extensions
Table 4-2: GE Retail Capital Finance, Selected Private Label Credit Card Agreements, 2010-2011
GE Capital Back in the Red as Losses and Impairments Declined
Competitor Profile: HSBC Retail Services (HSBC Finance Corp.)
HSBC Announces Sale of Credit Card Business to Capital One
Table 4-3: HSBC, Selected Private Label Credit Card Agreements, 2010-2011
Loss of Merchant Relationships and Higher Impairments Impact Results
Competitor Profile: Capital One Financial
Capital One’s Position in Private Label Cards Growing Strong
Table 4-4: Capital One, Selected Private Label Credit Card Agreements, 2010-2011
Growth to be Driven by Acquisitions
Competitor Profile: JPMorgan Chase
JPMorgan Chase Divests Major Asset to Capital One
Performance and Outlook
Competitor Profile: Alliance Data
'Born from Retail'
Aggressive Investments during Downturn Drives Growth
Table 4-5: Alliance Data, Selected Private Label Credit Card Agreements, 2010-2011
Performance and Outlook
Competitor Profile: Wells Fargo Retail Services
Table 4-6: Wells Fargo, Selected Private Label Credit Card Agreements, 2010-2011
Performance and Outlook
Competitor Profile: The Army & Air Force Exchange Service (The Exchange)
Competitor Profile: TD Retail Card Services
TD Retail Targets Home and Jewelry Retailers
Table 4-7: TD Retail, Selected Private Label Credit Card Agreements, 2010-2011
Performance and Outlook
Competitor Retailer Profile: Target Financial Services (Target Corp.)
Target Credit Card Goes Exclusive
Target Credit Card 5% Discount
Target Puts Credit Card Receivables Up for Sale
Performance and Outlook
Competitor Retailer Profile: Signet Jewelers Limited
Performance and Outlook
Competitor Retailer Profile: Nordstrom Inc.
Rewards Program Drives Sales
Nordstrom Has No Plans to Sell Card Business
Performance and Outlook
Competitor Profile: Cato Fashions (Cato Corp.)
Performance and Outlook
Scope of Report
Methodology
Private Label Cards Market and Growth
Private Label Card Spending Down 14% in 2010
Large Private Label Programs Suffer the Most
Figure 1-1: U.S. Private Label Card Purchase Volume and Share of Total Credit and Debit Card Purchase Volume, 2006-2010 (in billions of dollars)
Total U.S. Private label Card Receivables
Figure 1-2: U.S. Private Label Card End-of-Period Receivables and Share of Total Consumer Revolving Credit Outstanding, 2006-2010 (in billions of dollars)
Large Declines in Receivables For Many Major Players
Private Label Cards Market Forecast
Table 1-1: U.S. Private Label Card Purchase Volume and Receivables Purchase Volume, 2010-2015 (in billions of dollars)
Factors Affecting Growth
Competitive Landscape
Receivables by Issuer
Table 1-2: U.S. Private Label Card End-of-Period Receivables by Issuer, 2006-2010 (in billions of dollars)
Purchase Volume by Issuer
Table 1-3: U.S. Private label Card Purchase Volume by Issuer, 2006-2010 (in billions of dollars)
Private Label’s Core Retail Categories
Core Retail Group Sales Performance
Figure 1-3: Total U.S. Retail Sales of Core Private Label Card Categories and Share of Total U.S. Retail Sales (Excluding Food Service), 2001-2010 (%)
Top 30 Private Label Card Retailers Accounted for 50% of Core Group Retail
Table 1-4: Top 30 U.S. Private Label Card Retailers by Net Sales, 2009-2010 (in billions U.S. $)
Top Private Label Card Retailers Programs and Their Issuers
The Consumer
61 Million American Adults Have a Private Label Credit Card
Usage Rates for All Private Label Credit Cards Declining
Table 1-5: Year over Year Usage of Selected Credit Card Classifications, Fall 2007-Winter 2011 (percentage of U.S. adults)
Private Label Usage Increases with Age
Twice as Many Women Use Private Label Credit Cards
Private Label Credit Card Usage Higher among Whites and Asians
Higher Income Equals Greater Usage
Smaller households are more frequent users of store cards
Top Demographics of Private Label Cardholders Established, Female and Northeastern
Table 1-6: Indices for Use of Any Private Label Card in Last Month, Select Demographic Characteristics, 2011 (U.S. Adults)
Trends and Opportunities
Cautiously Higher Expectations for Economy Get Dashed
Possibility of Double-Dip Recession
For Private Label Credit Cards, Good and Bad
New Legislation Will Restrict Credit Card Industry
Contract Negotiations and Consumer Offerings Affected by New Regulations
A Happier Credit Consumer Follows
Store Cards as Loyalty Cards
Retaining Happy Customers Key
Customers More Empowered
Older, Richer, Smaller Households Strongest Target Group
Maximize Online Store Card Use
Challenge from Alternative Payments Sector
Payment Options: Easy and Green
Developing New Markets
Fraud Top of Mind
How Mobile Changed Retail
CHAPTER 2: THE MARKET: HIGHLIGHTS
Scope of Report
Methodology
Private Label Card Basics
Major Retailer Benefits: Usable Data and Customer Loyalty
Major Cardholder Benefit: Buying Power
Total Credit and Debit Card Market and Growth
Total U.S. Card Growth Hits Great Recession Bump in the Road
Card Purchase Volume Up 8% in 2010
Card Spending Captures Largest Share of Consumer Spending
Greatest Card Growth Seen in 2007
Slowing Economy Slows Purchase Volume Growth
Figure 2-1: U.S. General Purpose Card Purchase Volume, 2006-2010 (in billions of dollars)
Total Card Purchase Volume Sees Its First Decline
Overall Growth Modest, Penetration Increase Impressive
Private Label Cards Market and Growth
Total U.S. Private Label Card Purchasing
Private Label Card Spending Down 14% in 2010
Large Private Label Programs Suffer the Most
Smaller Programs, Specialty Retailers See Growth
Figure 2-2: U.S. Private Label Card Purchase Volume and Share of Total Credit and Debit Card Purchase Volume, 2006-2010 (in billions of dollars)
Overall Growth Only Seen in 2007
Private Label Card Spending Hit Harder Faster Than General Purpose Cards
Spending Declines Accelerate in 2009
Penetration Rate Falls 2.9 Percentage Points
General Purpose Card Performance Contrast
Table 2-1: U.S. General Purpose and Private Label Card Purchase Volumes and Year-over-Year Percentage Change, 2006-2010 (in billions of dollars)
Fewer U.S. Adults Using Private Label Cards
Figure 2-3: U.S. Private Label Card Usage Among U.S. Adults and Share of Total Credit Usage in the Past 12 Months, 2007-2010 (in millions of U.S. adults)
Average Private Label Card Spending down 15% Since 2007
Figure 2-4: Average Amount Spent per U.S. Adult on Private Label Cards in the Past 12 Months, 2007-2010 (in millions of U.S. adults)
Total U.S. Consumer Revolving Credit Outstanding
Figure 2-5: Total U.S. Consumer Revolving Credit Outstanding, 2006-2010 (in billions of dollars)
Total U.S. Private Label Card Receivables
Figure 2-6: U.S. Private Label Card End-of-Period Receivables and Share of Total Consumer Revolving Credit Outstanding, 2006-2010 (in billions of dollars)
Large Declines in Receivables for Many Major Players
Some Bright Spots among Smaller Issuers in 2010
Receivables Growth at Its Apex in 2007
Recession Accelerates Receivables Decline
Table 2-2: U.S. Private label Card End-of-Period Receivables and Consumer Revolving Credit Outstanding and Year-over-Year Percentage Change, 2006-2010 (in billions of dollars)
Private Label Card Receivables Lose Share Among Total Consumer Card Debt
Total U.S. Third-Party Private Label Card Purchase Volume
Figure 2-7: U.S. Private Label Card Purchase Volume on Cards by Third-Party Issuers and Share of Total Private Label Purchase Volume, 2006-2010 (in billions of dollars)
Total U.S. In-House Private Label Card Purchase Volume
Figure 2-8: U.S. Private Label Card Purchase Volume on Cards In-house Issuers and Share of Total Private Label Purchase Volume, 2006-2010 (in millions of dollars)
Table 2-3: U.S. Private Label Card Purchase Volume by Issuer Type (Third Party, In-house) and Year-over-Year Percentage Change, 2006-2010 (in millions of dollars)
Total U.S. Third-Party Private Label Card Receivables
Figure 2-9: U.S. Private Label Card End-of-Period Receivables Managed by Third-Party Issuers and Share of Total Private Label Receivables, 2006-2010 (in billions of dollars)
Total U.S. In-House Private Label Card Receivables
Figure 2-10: U.S. Private Label Card End-of-Period Receivables Managed by In-house Issuers and Share of Total Private Label Receivables, 2006-2010 (in millions of dollars)
Table 2-4: U.S. Private Label Card End-of-Period Receivables by Manager Type (Third Party, In-house) and Year-over-Year Percentage Change, 2006-2010 (in millions of dollars)
Private Label Cards Market Forecast
Total U.S. Private Label Card Purchasing
Growth in 2011 Down
Snap Back in 2012
Figure 2-11: U.S. Private Label Card Purchase Volume and Share of Total Credit and Debit Card Purchase Volume, 2010-2015 (in billions of dollars)
Table 2-5: U.S. General Purpose and Private Label Card Purchase Volumes and Year-over-Year Percentage Change, 2010-2015 (in billions of dollars)
Total U.S. Private Label Card Receivables
Figure 2-12: U.S. Private Label Card End-of-Period Receivables, 2010-2015 (in billions of dollars)
Table 2-6: U.S. Private Label Card End-of-Period Receivables and Consumer Revolving Credit Outstanding and Year-over-Year Percentage Change, 2010-2015 (in millions of dollars)
Factors Affecting Growth
Economic Factors Weigh Heavily
Job Growth Quality Falters
Consumer Sentiment Plummets
Disposable Income Slowing, Personal Savings Rising
Greater Numbers of Retirees to Spend Less
Private label Card Product Challenges
New Payment Options Pose Increased Competition
Retail Segments Related to the Home to See Delayed Rebound
Certain Channels Losing Customers to General Merchandise Stores, Online Retail
CHAPTER 3: COMPETITIVE LANDSCAPE: HIGHLIGHTS
Private Label Card Issuers
Receivables by Issuer
Citibank Receivables Continue to Shrink
No One to Buy Citibank’s Portfolio
GE Capital Retail Finance Focuses on the U.S.
HSBC Finance Receivables Down 12%
Capital One Buys HSBC, Becomes Private Label Card Powerhouse
JPMorgan Chase Halves Portfolio
Table 3-1: U.S. Private Label Card End-of-Period Receivables by Issuer, 2006-2010 (in billions of dollars)
Table 3-2: U.S. Private Label Card End-of-Period Receivables Percentage Change by Issuer, 2007-2010 (%)
Alliance Data Systems Receivables Rise
Smaller, Independent Issuers Fare Better
Who Will Buy Target’s Program
Target to Go North
Will Nordstrom, Signet Sell Out?
Two Independents, Two Different Card Programs
Nordstrom Potentially Less Risky, Signet Potentially More Profitable
Figure 3-1: Share of U.S. Private Label Card End-of-Period Receivables by Issuer, 2010 (%)
Figure 3-2: Share of U.S. Private Label Card End-of-Period Receivables by Third-Party Issuer, 2010 (%)
Figure 3-3: Share of U.S. Private Label Card End-of-Period Receivables by In-House Issuer, 2010 (%)
Purchase Volume by Issuer
Gas Price Volatility Affects Purchase Volume
Citibank Purchase Volume Down
Alliance Data’s Purchase Volume Rebounds
Target’s Focus on REDCard Lifts Purchase Volume
Cato Fashions Moving Away from Private Label Cards?
Table 3-3: U.S. Private Label Card Purchase Volume by Issuer, 2006-2010 (in billions of dollars)
Table 3-4: U.S. Private Label Card End-of-Period Receivables Percentage Change by Issuer, 2007-2010 (%)
Figure 3-4: Share of U.S. Private label Card End-of-Period Receivables by Issuer, 2010 (%)
Figure 3-5: Share of U.S. Private label Card End-of-Period Receivables by Third-Party Issuer, 2010 (%)
Figure 3-6: Share of U.S. Private label Card End-of-Period Receivables by In-House Issuer, 2010 (%)
Private Label Card Retail
Private Label’s Core Retail Categories
General Merchandise Stores
Building Material Stores
Clothing & Accessory Stores
Electronics & Appliance Stores
Furniture & Home Furnishing Stores
Sporting Goods, Hobby, Book, and Music Stores
Office Supply Stores
Non-Core Retailer Categories
Core Retail Group Sales Performance
Figure 3-7: Total U.S. Retail Sales of Core Private Label Card Categories and Share of Total U.S. Retail Sales (Excluding Food Service), 2001-2010 (%)
Table 3-5: Total U.S. Retail Sales by Core Private Label Card Category, 2006-2010 (in billions of dollars)
Figure 3-8: Share of U.S. Retail Sales by Core Private Label Card Category, 2010 (%)
Ecommerce May Be the Place to Be
Figure 3-9: Total U.S. Retail Sales of Core Private Label Categories Including Ecommerce and Share of Total U.S. Retail Sales (Excluding Food Service), 2001-2010 (%)
Table 3-6: Total U.S. Retail Sales by Core Private Label Category including Ecommerce and Mail Order, 2006-2010 (in billions of dollars)
Figure 3-10: Share of U.S. Retail Sales by Core Private Label Card Category Including Ecommerce, 2010 (%)
Top 30 Private Label Card Retailers
Top 30 Private label Card Retailers Accounted for 50% of Core Group Retail
Figure 3-11: Top 30 Private Label Retailers Total Sales and Share of Core Group Retail Sales, Including and Excluding Ecommerce, 2009-2010 (in billions U.S. dollars, %)
Wal-Mart the Heavyweight, Target a Distant No.2
Costco Quietly Grows
Big Box Store Receivables Trend
Figure 3-12: Total Target Corp. and Wal-Mart, Inc. End-of-Period Receivables: Private Label and Co-Brand Card, 2006-2010 (in billions U.S. dollars)
Home Depot and Lowe’s Are Big Players
Home Depot Private Label Volume Declines Amidst Total Sales Growth
Best Buy Leads Electronic Stores
Figure 3-13: Total U.S. Sales at Home Depot (Private Label Card and All Other) and Private Label Card Share of Total U.S. Sales, 2006-2010 (in billions U.S. dollars)
Table 3-7: Top 30 U.S. Private Label Card Retailers by Net Sales, 2009-2010 (in billions U.S. $)
Issuer Focus: GE Capital’s Retailer Receivables
Wal-Mart’s Receivable Growth Comes from Co-Brand Card, Private Label Flat
JCPenney Receivables Decline 12% from High, Modestly for Period
Declines Concentrated in Lowe’s, Dillard’s
Table 3-8: Selected GE Money Bank Retailer Card Receivables (Securitized), 2006-2010 (in billions U.S. $)
Figure 3-14: Share of GE Capital Retail Financing Securitized Receivables, 2010 (%)
Top Private Label Card Retailers Programs and Their Issuers
Table 3-9: Leading Retailer Private Label Card Programs, 2011
CHAPTER 4: COMPETITOR PROFILES: HIGHLIGHTS
Competitor Profile: Citi Retail Services (Citigroup, Inc.)
Focus on Credit Quality Results in Lower Delinquencies
Profitable Retail Partner Cards Division
Table 4-1: Citigroup, Selected Private Label Credit Card Agreements, 2010-2011
Performance and Outlook
Competitor Profile: GE Capital Retail Finance (General Electric Co.)
GE Capital Scales Down Operations
GE Streamlines U.S. Credit Card Portfolio
New Accounts and Account Extensions
Table 4-2: GE Retail Capital Finance, Selected Private Label Credit Card Agreements, 2010-2011
GE Capital Back in the Red as Losses and Impairments Declined
Competitor Profile: HSBC Retail Services (HSBC Finance Corp.)
HSBC Announces Sale of Credit Card Business to Capital One
Table 4-3: HSBC, Selected Private Label Credit Card Agreements, 2010-2011
Loss of Merchant Relationships and Higher Impairments Impact Results
Competitor Profile: Capital One Financial
Capital One’s Position in Private Label Cards Growing Strong
Table 4-4: Capital One, Selected Private Label Credit Card Agreements, 2010-2011
Growth to be Driven by Acquisitions
Competitor Profile: JPMorgan Chase
JPMorgan Chase Divests Major Asset to Capital One
Performance and Outlook
Competitor Profile: Alliance Data
'Born from Retail'
Aggressive Investments during Downturn Drives Growth
Table 4-5: Alliance Data, Selected Private Label Credit Card Agreements, 2010-2011
Performance and Outlook
Competitor Profile: Wells Fargo Retail Services
Table 4-6: Wells Fargo, Selected Private Label Credit Card Agreements, 2010-2011
Performance and Outlook
Competitor Profile: The Army & Air Force Exchange Service (The Exchange)
Competitor Profile: TD Retail Card Services
TD Retail Targets Home and Jewelry Retailers
Table 4-7: TD Retail, Selected Private Label Credit Card Agreements, 2010-2011
Performance and Outlook
Competitor Retailer Profile: Target Financial Services (Target Corp.)
Target Credit Card Goes Exclusive
Target Credit Card 5% Discount
Target Puts Credit Card Receivables Up for Sale
Performance and Outlook
Competitor Retailer Profile: Signet Jewelers Limited
Performance and Outlook
Competitor Retailer Profile: Nordstrom Inc.
Rewards Program Drives Sales
Nordstrom Has No Plans to Sell Card Business
Performance and Outlook
Competitor Profile: Cato Fashions (Cato Corp.)
Performance and Outlook
