What Is a Statement Stuffer?

A statement stuffer is a type of sales brochure commonly used in direct marketing campaigns. Specifically, it is associated with financial service providers such as banks and brokerage companies, who often include these advertisements along with their monthly account statements.

The purpose of statement stuffers is to “up-sell” account holders on related services, such as credit cards, lines of credit, or additional brokerage services.

Key Takeaways

  • Statement stuffers are advertisements delivered to customers along with their account statements.
  • They often relate to ancillary services which the sender seeks to “up-sell”.
  • By encouraging customers to subscribe to a wider range of products and services, financial firms seek to improve customer retention by increasing the switching costs associated with leaving their business.

How Statement Stuffers Work

Typically, statement stuffers include an overview of financial services that are related to those which the customer has already been subscribed to. For instance, a banking customer who holds a checking and savings account might be given a statement stuffer advertising personal lines of credit or retirement savings accounts. Although these services are mostly offered by the institution already serving that customer, the promotional offers may originate from other institutions with whom they are partnered.

Statement stuffers are popular among financial firms because they offer a convenient and inexpensive form of marketing. In recent years, however, digital versions of these advertisements—colloquially known as “e-stuffers”—have also become common.

From the perspective of the financial institutions who produce them, statement stuffers are used to enhance profitability by encouraging customers to sign on to a wider cross-section of products. Generally, financial institutions will seek to obtain new customers by offering especially attractive products, often competing on the basis of price. These so-called “loss leaders” may be relatively unprofitable for the company offering them, in which case they may seek to increase their margins by selling more profitable products or services to those customers in the future (sometimes advertising these more expensive, related products in statement stuffers). Occasionally, statement stuffers are used for non-commercial purposes, such as when informing the customer that a change to the terms or conditions of their accounts has taken place.

Real World Example of a Statement Stuffer

Many financial firms would like to be involved in as many shares of their customers’ lives as possible. After all, customers who have multiple services arranged through a particular provider may be less likely to switch providers due to the cost and complexity of doing so.

For example, many life insurance companies today also offer other insurance products, such as disability income insurance or long-term care insurance. Increasingly, this list is expanding to include investment services as well, such as various annuity products

Likewise, banks and other financial services companies may wish to expand their product offerings into insurance, stock brokerage services, and other areas. By advertising these services to their customers through statement stuffers and other forms of marketing, they would hope to create a situation in which the customer is loyal to and dependent upon them for much of their financial life. If done successfully, this strategy of product diversification and direct marketing can increase the customer’s switching costs, or the fees they would incur if they decided to change providers, thereby providing a competitive advantage.