Banks that let their customer experience decline risk losing up to 12.5 percent of their share of deposits; at the same time banks with high customer experience metrics increased their share of deposits by 16.5 percent. ), Participate in reciprocal deposits (which are no longer considered brokered deposits thanks to the Economic Growth, Regulatory Relief, and Consumer Protection Act), Partner with a local travel agency to create a customer Travel Club that offers discounted trips but requires members to have an active account with your bank, Debit card chip technology for added security, Debit card control (turn on/off from mobile app), Early direct deposit (many FIs now offering the ability to get paid 2 days early), Automatic sweeps into higher interest accounts, Added mobile app security (fingerprint or two-factor authentication), Monitoring/alerts of recurring subscription payments, Choice of printed statements or eStatements with check images included/archived, Smart ATMs that accept cash deposits, are contactless, mobile-friendly, or have a video teller, Automated account switching from a previous bank account, Expedited account opening (“open an account in 5 minutes or less”), Free trades in corresponding investment account. By doing this, you’re creating an effective resource for your audience while simultaneously showing them why your services are the solution for their needs. Choose the deposit acquisition message that the bank would like to present to the public. However, a competitive loan offer may entice the same personal or business customer. Focus on who matters Customer service is still one of the key ways to attract and retain customers. As you plan a deposit growth strategy for your community bank or credit union, consider these essential tactics for increasing core deposits: 1. Remember you’re not the only bank trying to woo potential customers or sell additional products to existing customers. Large banks were too slow to capitalize on the rising rates, which left room for more nimble banks to pick up customers. The best option is to set your recurring transfers to take place on payday. Adding to the power of branch-based sales is the increasing use of tablet-assisted employees at the branch level who can have all of the tools at their fingertips. Use these strategies to keep your deposits safe when they top FDIC limits. You could also experiment with offering adult financial classes to help people understand how to secure their future — there are many options to utilize. Grab the first-mover advantage. The analysis of your current customer base gives you perspective on its demographic characteristics, lifestyle behaviors and buying patterns so you Setting up evergreen ad campaigns that bid for keywords on Google like “local bank near me” and “need to set up a checking account” can go a long way for lead generation. Identify the customers your bank would like to attract and try to understand their banking lives. Since it is nearly an impossible task to run a successful financial institution without gathering and growing deposits, we’ve put together some ways that you can increase your deposit growth. Easier said than done, but I’ve seen banks go from 40 to 70 in just a matter of 6 to 9 to 12 months. bankrate.com, nerdwallet.com, depositaccounts.com, etc. To learn more, go here. Bank and Credit Union sales, cross-selling, attrition and product substitution analytics from FlowTracker Analytics Inc. If you’re trying to sell a particular product – deposit accounts, for example – use your content as an opportunity to sell your audience by educating them about that product. You may be the closest financial institution, and you may have the best rates for your deposit accounts, but if your competitors are dominating the top organic positions in Google and Bing search results, then you are missing out on new customers. Once your visitor has landed on your site or visited one of your branches, this is the time to present an attractive offer for a new deposit account. The ball is in your court now. Solicit deposits directly from customers through the following steps: Obtain best advertising rate quotes from newspapers, radio and television sources. Presented by: Bryan Easley Vice President Haberfeld Associates 206 S. 13th St., Suite 1500 Lincoln, NE 68508 P: 402-323-3791 E: bryan@haberfeld.com Thursday, June 23, 2016 Strategies to Increase Fee Income & Revenue . The last time community banks and credit unions had to proactively think about rising rate strategies was a few years before the 2008 crash, and according to TheFinancial Brand, there were three lessons to be learned: It’s fair to say there’s a similar opportunity today for community banks with smart deposit gathering strategies to play ball with bigger banks. Here are some of the top growth strategies that bankers were focusing on in 2017: Some tactics will change a bit in 2020, but this is generally where the industry has its focus. In response to the burgeoning public health crisis, the Federal Financial Institutions Examination Council issued revised guidanceon March 6 on how to address pandemic planning in a bank’s business continuity plans. Marketing is all about specificity. For example, a Facebook campaign promoting business checking accounts can be delivered to business owners or executives of a certain age group within five miles of your branch locations. This isn’t the end-all of marketing strategies, but it is the one that speaks most plainly and has the easiest pitch. That means you need to do your research, then roll out the red carpet. For many consumers, personal finance is a difficult, confusing topic. Banks in this position may find it difficult to increase their share in existing segments. When it comes to high net worth customers, pick up the phone and get personal. As you plan a deposit growth strategy for your community bank or credit union, consider these essential tactics for increasing core deposits: According to the CA Web Stress Index, 88% of consumers will shop online first before opening a checking account. While Banks are getting more and more pressure from customer’s increasing demand, highly competitive market and strict regulations – in the current environment, understanding customer behavior, attitudes and requirements is more vital than ever for banks’ strategic thinking, operational planning and day-to-day customer treatment, according to Ernst & Young. By contrast, top performing banks saw an increase of only 140 basis points, capturing a funding advantage of 45 basis points per every 100 basis-point increase in the Fed Funds rate. As a result, it’s become essential to place your community bank in front of these searchers. Welcome back. As technology becomes more robust and customer-buying habits shift, banks and credit unions must constantly be looking for areas of innovation and ways to meet the demands of a 21st-century customer. Explore Online Account Harvesting. While competition has already begun heating up in some markets, these are the early skirmishes in a sustained war for core deposits. 10 Tactics for driving deposit growth #1 Analyze your best customers and build a marketing campaign for them Online banks, not incurring costs associated with physical branches, often offer higher interest rates on deposits than traditional banks. Bank leaders expect deposit competition to increase over the next 12 months, and the number of executives expecting deposit competition to grow are at record-high levels for almost every region. If you’re looking to target a more specific audience, keep reading to learn more. Understanding what your members or customers actually do with their money is revealed by our patented analytics. With that in mind, let’s cover 10 bank deposit gathering strategies you can use to increase your deposits. Check the deposit rates that peer group banks are offering to … Indeed, consider what a Bank Executive Business Outlook Survey from late 2017 found. One is that your customers spend much of their lives online and on their mobile phones. Retail banks are under increasing pressure to retain and grow deposits, ... Identify these industries and explore focused strategies to better penetrate these segments. And while national banks enjoy widespread brand awareness thanks to enormous marketing budgets, awareness of community banks and credit unions in their local market is typically about half that of megabanks. For example, many credit unions and community banks partner with local car salesmen to offer seamless loan financing. 5 Strategies for Growing Core Deposits Regulators and bankers are sharing one concern in common—how they will get and keep deposits as interest rates rise . Even the majority of people who decide to open an account at a physical branch gather information online first. Overall, don’t take any customer for granted. Are they lifelong residents in the area, or have they just moved here from out of state? Offer progressive rates depending on the amount in an account. The more you can speak to that customer persona’s specific needs, the more likely they are to convert to your bank. On a similar note, finding the best businesses in your area and developing relationships with them can go a long way — especially if the services they provide frequently require financing. Increasing your marketing effort to target deposits can pay off handsomely for banks. This guide provides strategies for reaching prospective customers/members in order to increase core deposits. With a proactive plan that capitalizes on your institution’s existing strengths, your FI can create winning strategies to increase deposits and thrive in a new era banking. With that in mind, let’s cover 10 bank deposit gathering strategies you can use to increase your deposits. Contact us today. Of course, not every FI is able to raise its deposit rate. Big banks only passed on a small portion of the Fed’s rate hikes. By utilizing strategies like pay-per-click (PPC) advertising using tools like Google Ads, community banks have the opportunity to push past their competitors and gain prominence at the top of the search engine results pages. You can further narrow your targeting to a specific list of customer email addresses (e.g. Every dollar counts! Local search engine optimization (SEO) ensures prospects will find you online If a customer is happy with the way they are … We enable deposit growth with fine-grained analysis of depositor behavior in the context of sales, attrition, product substitution and cross-selling. Draw inspiration for these articles from common questions you receive on a regular basis, or highlight services that would be most beneficial for your target audiences. Your fortunes are intertwined with those of your neighbors and that is a powerful selling point. Effective storytelling can yield serious results. In order to attract and retain depositors, local banks must adjust how they engage customers and differentiate their brand. This much is obvious, but many financial institutions aren’t leveraging the full potential of their online presence with an effective search marketing campaign. Bank deposits consist of money placed into banking institutions for safekeeping. Are your prospective customers even aware of your bank? Just remember that unless you’re dealing with customers with high volumes of cash, then chances are a rate may get a potential lead in the door but won’t keep them — your customer experience and ability to help them achieve their financial goals will. One of the easiest ways to generate new business and increase loyalty of current retail or business customers is to ask (and possibly incent) for referrals. Having the right focus for smarter performance management, targeting for … Education . If it’s not, Google will downrank your site and younger demographics won’t convert as well. Effective bundling with your consumer products can lead to an increase in consumer deposits. This makes the most of your ad spend by only showing your ads to individuals that you’ve selected through targeting. Win them over by being genuine, accessible, thorough, and proactive. ), Tiered rates based on higher deposit balances, Referral incentives for signing up friends, Offering completely free checking to earn new customers, with intentional up-selling strategy, Offering relevant checking accounts for specific life-stages (e.g. Need a partner to execute your deposit growth strategy? Here are some things you should consider when building a paid search campaign if your goal is to increase deposits: The world of PPC is vast, and there are many elements that we haven’t touched on in this article – budget, ad extensions, display advertising, remarketing/retargeting, customer-match, and more. On the commercial side, train your bankers to ask for deposits and incentivize them to … An easy way to test if your site is responsive is to open it on your desktop, click the top right of the window, and drag it down to a small size. There was a time when serving up a smile and a small gift was enough to gain new accounts. When they do, make it count with friendly, personalized service. FDIC deposit insurance covers $250,000 per depositor, per FDIC-insured bank, per … The basic premise of business realignment is to exit business lines that have low margins and move instead into lines that are inherently more cost-effective and increase bank profitability. George Doyle/Stockbyte/Getty Images . Now your community bank is competing against larger banks as well as online-only financial institutions for highly sought-after customers. Apply rising rates, externalities like increased social media advertising by national banks (which is currently happening) or a credit shock to the deposit holding institutions, and the average life numbers shrink dramatically. If you plan to enhance your online presence with paid ads, your best bet is to partner with a digital marketing agency that is experienced in helping banks grow. Start with just $5 per week if you can’t afford more and increase it over time. By firmly investing back into your community with both actions and words, you can give potential customers a reason to choose you over a bigger bank, even if those banks have better rates. Every financial institution should have implemented pandemic planning contingencies contained in its business continuity plan. At least for transactional banking purposes, many customers can’t remember the last time they walked into a physical bank. Once you’ve mapped out this information, then you can design your bank deposit marketing and outreach plan accordingly. While foot traffic to branch offices had been decreasing prior to the pandemic, this trend has now accelerated dramatically. In the aftermath of the Great Recession of 2009, community bank performance rebounded in tandem with the rest of the banking industry. Following are six strategic areas where today’s industry leaders are focusing their efforts. Your bank should feel like a trusted resource. Couple this with a comprehensive understanding of your audience, and you can create social media ads that drive highly-qualified traffic to your site. You have a set-it-and-forget-it bank deposit growth machine. 4. The biggest things to nail down are your Google Business page, collecting Google reviews, and making sure you’ve submitted your address and phone number to Google Maps, Waze, etc. Recent deposit trends, moreover, may be a sign of the changing financial environment, which is not only increasing competition among banks, other financial institutions, and the capital markets, but is also creating new funding instruments and bank delivery channels. Although there are no substantive updatescontained in th… As an example, a large regional bank that we know used data analytics and market research to successfully restructure demand deposit account pricing, resulting in a net increase … Paid search advertising offers a clear path to presenting your services out to a highly-qualified audience. Which of these bank deposit marketing strategies will you use next? STRATEGIES TO INCREASE FEE INCOME & REVENUE . If you do not already have a mobile app to offer your clients, create a simple option that allows customers to perform basic functions like check deposit, account overview, and funds transfer from their handheld device. This targeting also allows you to create ads that are tailored to the needs of your specific audiences. Gathering deposits is the key to healthy growth in Banks and Credit Unions. Paid search campaigns are so effective because they can be targeted to a specific audience according to the exact phrases they are searching Google for. Subscribe to our newsletter and get payment processing news & insights sent to your inbox. 13 Source: Promontory Interfinancial Network’s Bank Executive Business Outlook Survey report, Q2 2018 Expectations for Deposit Competition– Next 12 Months. For full functionality of this site it is necessary to enable JavaScript. This presents a major challenge for local FIs since most consumers searching for a checking account already have a brand in mind, and largely end up choosing that brand (see Oliver Wyman study). Raising deposit rates was the most popular way within the industry to get more deposits. Being responsive is just a fancy way of saying your site can be used and looks good on mobile. Part of your bank marketing plan should be to identify the consumer and business personas who can significantly help you grow your deposits, then develop a multi-channel strategy to reach them. Copyright 2020 Tidal Commerce. An important consideration as you create your desired customer profiles is to research what you think may be attractive to your audience. 6% of U.S. total banks closed following the financial crisis, and it is projected that 20% of all branches will close by 2020. Invest in relevant educational content by creating high-quality website content and blog articles that will inform your audience. With an estimated 224 million smartphone users in the U.S. in 2017, many of the high deposit customers your bank needs to attract are among this group. effective deposit growth strategies. If you want to attract more of a certain type of banking customer, then you and your entire staff need to understand who they are and their motivations for working with a local bank. These strategies are generally useful for increasing your online visibility to a local audience and will yield long-term results. 5. One of the best ways to prepare for the changing environment is to make sure your bank has a written, well-prepared deposit strategy. BankBound works exclusively with community banks and credit unions, using data-driven marketing to ensure the best ROI. You could then advertise that higher rate heavily. If your bank does not have a digital presence that allows simple transactions to be done anywhere, anytime, you will not grow your number of deposits and, in fact, you may lose existing customers. SEO stands for search engine optimization, and it’s just making sure your site communicates with Google and other local directories in the best way possible. The average American’s banking behavior is very different now than it was in 2009. If you work with local business owners, see if you can partner on fundraisers or donate to local schools together. loan customers who don’t also have a checking account with your financial institution). For example, if you work with a lot of business owners, you could partner with an entrepreneurship center to get discounts for your members or provide innovative merchant services via a partnership. However, when it comes to growing deposits, don’t forget that Baby Boomers still hold two-thirds of all deposits, with substantially more assets under management at RIA (registered investment advisory) firms. If you take the time to really build out a plan and execute it with a smart, analytical approach, then you will absolutely drive deposit growth for your bank. ( Read More: How Banks and Credit Unions Can Survive Rising Interest Rates ) 4. Analyze your existing customers and figure out which demographic will be your focus for this quarter or marketing campaign and then write up a one-sheet outlining exactly how they currently find out about your bank and what services you offer that are most appealing to them. While prices will be much higher in larger cities, you should definitely be playing the online advertising game. In 2019, it’s become the norm for potential customers to turn to a search engine to research a product or service before they make a decision. According to a 2019 report from CommunityBanking.org, “Nearly one-third of bankers ranked either core deposit growth or the cost of funds as their greatest challenge.” Since then, the COVID-19 pandemic has created a number of new challenges for financial institutions. Banks can employ a number of different deposit-gathering strategies ranging from promotional rates to prize draws to lure new customers. 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