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The two major bankcard brands are wasting no time responding to American Express Co.'s new Optima True Grace card.

Visa USA last week ran page newspaper ads in USA Today, The Wall Street Journal and 11 top markets, reminding consumers that when it comes to merchant acceptance, AmEx isn't "everywhere you want to be." And MasterCard International plans a TV and print campaign later this month that will also attack AmEx-but not True Grace-by name.

AmEx started the latest phase of the card wars with a long-awaited reintroduction of its Optima revolving credit card, promising that, unlike most bankcards, it would charge no interest during the grace period on new purchases, even if balances remain unpaid. (AA, Sept. 5).

An introductory TV campaign from Ogilvy & Mather, New York, features home decorating doyenne Martha Stewart facetiously cutting up her bankcards and using them to retile her pool.

Industry executives say bankers quickly grew nervous about the latest threat to their business, especially given AmEx's aggressivemarketing support. Media spending is estimated at more than $10 million.

"American Express is targeting the bread and butter of our members' business," said Joan Bogin, MasterCard's VP-advertising.

MasterCard's new campaign, part of its "Smart Money" effort from Ammirati & Puris/Lintas, New York, will tackle AmEx. However, Ms. Bogin said she's "leaning against naming their product because on TV why create more buzz around that name?"

Besides, she said, AmEx plans more niche card products beginning next year, all designed to steal share from bankcards, so MasterCard is seeking a more encompassing marketing response.

Like those planned by MasterCard, Visa's ad promotes its main advantage against Optima: acceptance at more than 11 million merchants worldwide, vs. 3.7 million for AmEx. Visa has used that fact in its successful nine-year "It's everywhere you want to be" campaign from BBDO Worldwide.

"The places that accept the new American Express Optima True Grace Card dot the world," the ad is headlined, above an illustration of a dotted globe. "We just have 7 million more dots than they do."

"It's simply part of our ongoing campaign that goes back to 1985 that stresses we're better than AmEx on the merchant side of the business," said a Visa spokesman.

The hoopla comes despite reassuring MasterCard research, which found in focus groups that 90% "could not correctly play back what the benefits are" of the True Grace card, Ms. Bogin said.

But AmEx's deep pockets and increasing competition promise to keep bankers busy.

Separately, Visa cheered a Denver federal appeals court's refusal to allow Dean Witter, Discover & Co. to issue Visa cards in a long-fought case that would have also allowed AmEx to do so. Visa argued Dean Witter was unfairly seeking access to Visa's marketing and information systems, a move that would benefit rival Discover Card.

MasterCard earlier reached a settlement allowing Dean Witter to issue a Prime Option MasterCard, but only through MasterCard member NationsBank, which controls much of that program.

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