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Technology Stocks : NextCard, Inc. (NXCD)
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To: KS who wrote (68)9/28/1999 8:37:00 PM
From: puborectalis   of 192
 
Huge News on NXCD!!SILICON VALLEY STOCK REPORT 7/5/99 - NXCD
Don't be surprised if you hear "What's on your NextCard," in the next few weeks. NextCard,
Inc., an Internet-based credit card company, is launching a 10 million dollar national branding
campaign asking people that very question. It is the company's first major move into
non-online mainstream advertising. It is also a push to grow the company's list of more than 2
million applicants. According to the company, the "What's on your NextCard" campaign
begins with a series of print advertisements featuring the personalized credit cards that
made the company popular. It will then proceed to brand the card as the one you can get
online and use everywhere. The move to mainstream media should be a positive move for
the company. Unfortunately, consumers are going to need to be pursuaded to move from
some of the large credit card issuers. I am not convinced that personalization of the card face
will be the hook, especially among non-Internet savy consumers. Despite the intense
competition in the credit card business, it should help the company eventually rebound from
the net loss of 11 million dollars it posted in March. In the company's defense, interest income
increased during the same period from 33 thousand dollars in 1998 to 660 thousand in 1999.
The current hit to the profit margin is the intense amount of spending for advertising and
promotion. While it may be a few more quarters before the company turns a profit, its prudent
move into mainstream credit card competition may prove enough to keep revenues and the
stock price charging ahead.
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