Capital One will boost its marketing budget this year in an effort to drive growth in its domestic card business and other areas. The move follows a double-digit rise in marketing expenses during the fourth quarter of 2014.
The Virginia-based company's marketing spend jumped 19% year-over-year to $509 million during the quarter, and rose 14% to $1.56 billion for the year, according to its earnings release. Last year, Capital One upped its marketing spend by 9% during the fourth quarter.
The higher spend was spurred by "growth opportunities," said Richard Fairbank, chairman-CEO at Capital One, on a conference call with analysts. He did not provide specific examples.
The firm's marketing budget for 2015 will be higher than last year, as it looks to spurs growth in the domestic card business, as well as loans, deposits and account relationships. Mr. Fairbank also said the company is making "significant investments" to become a "digital leader," particularly on the consumer side where the company expects digital to transform banking. "It's pretty much a revolutionary deal on the consumer side," he said.
The company acquired the digital design firm Adaptive Path last year, and it bought the millennial budgeting app Level Money this month.
Fourth quarter earnings rose 17% from a year earlier to $999 million, as the domestic card business grew. Net revenue increased 5% to $5.8 billion from a year earlier.