Quick Overview

SmartCredit is getting ahead in a brutally competitive marketplace (online credit reports/monitoring services) thanks to some very powerful marketing tactics. They recruit partners to promote co-branded versions of their subscription service, including a great thank-you page offer that every subscription site should copy. They also use high-performing email autoresponders, such as a 4-email recovery series for prospects that abandon the free trial form. And their subscription promises more than just content — it gives members a feeling of control with the ability to act on that content. Read on for more details from our exclusive interview with CMO Ethan Taub…

Site Snapshot

Founded: 2003
No. of Employees: ~35
Business Model: Hybrid (subscriptions + lead gen)
Monthly Unique Visitors: 200,000 (counting all brand sites, co-branded sites and landing pages)
Headquarters: Costa Mesa, CA
Parent Company: Consumer Direct
http://www.smartcredit.com

Target Audience

SmartCredit’s primary audience is college educated women — especially wives and mothers with a financial planning/management role for their family — who have one of three financial motivations:

• They’re about to take out a new loan and need to check their credit
• They have good credit and want to protect it
• They have distressed credit and need help improving it

This focus is in clear opposition to their major competitor, FreeCreditReport.com, which has run massive TV ad campaigns that very clearly target young, single men.

Content Model

SmartCredit differentiates itself from competing credit reporting/monitoring sites by offering more than just access to personal credit data: Members can use a suite of interactive tools to communicate directly with their creditors and help improve their credit scores.

The services work on a patented online platform that connects SmartCredit’s site with 36,000+ creditors, such as banks, auto lenders, mortgage companies, utility companies, etc. The company spent eight years and $30 million creating this system.

“There are other places to get your credit report online, but we’re the only one that lets you take action on it and change it,” says Taub.

For example, SmartCredit’s interactive “SmartReport” credit report has a graphical user interface that lets members sort and search their credit data and see positives and negatives in their credit profile. Negative factors on the report, such as a missed payment, also feature a “Smart Action” button, which lets members send an electronic note directly to their creditors to address the problem.

Creditors respond directly through the SmartCredit system (typically in a few days to a few weeks), and any changes to the member’s credit report is automatically shared with the three major credit reporting agencies.

In addition to the SmartReport, subscribers also get:

– Credit and identity protection, which alerts members by email or text message about suspected misuse of their identity or credit cards. The service includes a mobile integration that lets members send a request from their phone to immediately freeze their accounts.

– Online widgets and tools called “SmartApps” that help members achieve specific financial goals. For example, one App lets members calculate an accelerated loan repayment schedule and then automatically set up that payment plan with their bank. Another app features tutorials and steps to improve credit from personal finance consultant Jean Chatzky, a member of the SmartCredit advisory board.

Revenue Streams

The vast majority of site revenues come from online subscriptions, which are offered at two levels: $19.95 a month for basic membership, which allows a limited number of reports/actions per month; Or $29.95 a month for an unlimited membership, which has no limits on the number of reports or actions a user can take.

The site also generates a small amount of revenue from fees it charges partners for lead-generation services through co-branded applications, such as an insurance app with partner InsWeb and an employment app with CareerBuilder. Taub expects this revenue stream to grow in the future as the site builds more apps.

Marketing Tactics

All subscription offers are based on a 5-day free trial. They promote that trial through their own site and marketing channels, as well as through the co-branded partnerships:

Co-branded partner marketing

Since summer of 2010, SmartCredit has recruited partners to offer co-branded versions of its apps and services to their customers. For example, a mortgage lender can place an offer for a SmartReport on its website, which directs users to a co-branded subdomain at SmartCredit.com where they’re offered a trial membership.

Partners can choose to receive a portion of the membership fee from any conversions they generate, but Taub says many prefer to let SmartCredit retain the entire amount. Instead, they see value in the ability track prospects who didn’t qualify for a loan initially, but who accepted the SmartCredit membership and then took action to improve their credit scores.

“Rather than throwing these leads in the garbage, now they have a way to recycle them.”

There are more than 400 partners providing direct links to the SmartCredit website. In addition to those direct links, the partnerships generate traffic through:

– Automated email

Taub’s team establishes triggered email programs that send offers when prospects take a specific action on a partner’s site. For example, a visitor who fills out an application on a mortgage lender’s site might receive an immediate offer for a SmartCredit free trial. Such messages average a 20% CTR and an 8.67% conversion rate on those who click.

– Thank-you page offers

Taub’s team also asks partners to place SmartCredit trial offers on their sites’ thank-you pages — say, after a visitor requests information about financial services. These offers are among the team’s highest-converting, generating a 15% CTR and a 14% conversion rate on those who click.

In-house marketing tactics

Taub’s team also does extensive marketing of its own to attract visitors directly to the SmartCredit site. Effective tactics include:

– Email marketing

The team has a database of 2 million opt-ins, to which it sends regular messages about the subscription services and free trial offers. These bulk messages generate a 19.2% CTR and an 8.33% conversion rate on those who click.

They also run several targeted and triggered email programs, including a 4-message recovery series for visitors who abandon the free trial form before completion.

– Direct links from ‘feeder sites’

In addition to the co-branded offers on its 400+ partner sites, SmartCredit operates four other brands related to its services, such as ScoreAssist.com, for the Jean Chatzky ScoreBuilder application. Free trial offers on these sites feed members into the SmartCredit system.

– Targeted banner advertising

Taub’s team runs targeted banner advertising on sites whose visitors are likely to be in the market for credit — e.g. real estate sites and car buying sites. Ads typically offer a free trial of the SmartReport, and achieve a 4% conversion rate on clicks.

– Public and media relations

Having famous team members discussing credit (and mentioning SmartCredit) in various media outlets helps build awareness and drive traffic.

Besides Jean Chatzky, there is John Ulzheimer, SmartCredit’s President of Consumer Education. Ulzheimer is a former executive with the credit reporting agency Equifax and FICO (creators of the credit scoring system), and is a frequent guest on television and radio, and a go-to source for print articles about consumer credit.

“These articles build links all over the net, and we also get lots of traffic whenever he’s on TV.”

Technology and Vendors Used

The site has its own staff of developers who created the SmartCredit platform and its credit apps. But here are a handful of third-party technologies and vendors they use:

RateSpecial: The site’s ad agency partner
http://www.ratespecial.com/

SilverPop: The site’s email service provider
http://www.silverpop.com

McAfee Secure: Ecommerce security monitoring service & trustmark for the site’s online registration form
http://www.mcafeesecure.com/us/

GeoTrust: SSL certificate provider for the site’s secure online registration form
http://www.geotrust.com/

Google Website Optimizer: Online testing platform Taub’s team uses for site and landing page optimization testing
http://www.google.com/websiteoptimizer

About Ethan Taub

Taub honed his direct marketing skills in positions at the online jewelry retailer Angara, and then as a VP for the marketing services company Acxiom, where he developed integrated campaigns for clients ranging from Sun Microsystems to Gap.

His experience taught him the importance of measurement, monitoring and testing to improve marketing results. “We’re pretty rigorous about A/B testing and multivariate testing.”

Subscription Site Insider’s Analysis

There’s a lot we like about SmartCredit. Reaching out to partners to create co-branded services is a fantastic way to expand a site’s reach. Placing thank-you page offers on partner sites, in particular, can be hugely successful and is something every B2C subscription site should look at. The same goes for automated email programs: Typically only the largest B2C subscription sites have an autoresponder series for trial-form abandons, but it’s a tactic even small sites can emulate to help recapture some of those prospects you worked so hard to get over that initial hump of clicking on a trial offer and beginning the registration process.

As good as the team’s direct marketing efforts are, we think one big missing piece is a branded marketing approach. If the site is to get bigger and become a household name, they need to expand on the PR and media relations outreach and consider developing a branding campaign of their own. Perhaps they can develop a mass-media campaign that uses a working mom as a spokeswoman, or they can find more ways to use Jean Chatzky’s high-profile in a concerted brand advertising campaign.