As the transition to online and mobile banking continues, traditional brick-and-mortar bank and credit union branches are facing a greater challenge to remain relevant – and profitable.
The challenge is undeniable: The number of U.S. branches has dropped steadily since 2009, when the total peaked at 99,540. And in a period of sluggish revenue growth and mounting operational and compliance costs, many banks and credit unions are looking for ways to reconfigure, rejuvenate or – worst case scenario – close underperforming branches.
While financial institutions can deploy a number of approaches to revive valuable but underperforming branches, one option to consider is an acquisition campaign to increase the number of profitable checking account customers and boost the branch’s bottom line.
The right approach will identify the best prospects in and around your trade area, successfully target them, and get their attention with a strong incentive. So who are the prospects that are likely to give your financial institution a second — or first — look?
Our research shows that despite the rising popularity of online banking services, consumers value convenient branch locations just as highly. So target specific prospects who live in or near the branch’s trade area. This includes new residents or those who due to life experiences are ready to open a new checking account.
Look at prospects who already have a checking account at another financial institution and may be in the market for another one. About half of US households have two or more checking accounts at multiple institutions. And multiple accounts are especially prevalent among younger, higher-income households.
Banks and credit unions will also want to attract long-term high-value customers: the ones with the potential for developing deep product penetration and greater share of wallet. Starting with a checking account establishes that consumer’s primary financial institution, and the possibility of multiple products and a positive revenue stream for the branch.
The right acquisition tools layer all the right data, plus include profiles of the financial institution’s best account holders, helping banks and credit unions identify and target the most likely and highest value responders in your branch’s trade area.
Combining pinpoint targeting with the right product and attractive incentive, delivered in a personalized direct mail piece, can attract the new account holders and profitable account relationships an underperforming branch needs to get back in the black.