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SteveNikitasSeniorStrategyDirectorHarlandClarke
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April25,2017
TheMarketer’sGuideToJustifyingYourExistencePart1:MeasuringSuccessofAccountHolderAcquisition
ChristineAhlgrenPaymentsMarketing
HarlandClarke
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©2017HarlandClarke.Allrightsreserved.
TheMarketer’sGuide
PART1MeasuringSuccessofAccountHolderAcquisition
PART2MeasuringtheImpactofCross-sellMarketingCampaignsJuly19@1p.m.ET
PART3RelatingAccountHolderLifetimeValuetoIndividualMarketingInitiativesOctober24@1p.m.ET
2 ©2017HarlandClarke.Allrightsreserved.
HistoricalNetInterestMargins
2.00%
2.50%
3.00%
3.50%
4.00%
4.50%
5.00%
5.50%
Q11984
Q41984
Q31985
Q21986
Q11987
Q41987
Q31988
Q21989
Q11990
Q41990
Q31991
Q21992
Q11993
Q41993
Q31994
Q21995
Q11996
Q41996
Q31997
Q21998
Q11999
Q41999
Q32000
Q22001
Q12002
Q42002
Q32003
Q22004
Q12005
Q42005
Q32006
Q22007
Q12008
Q42008
Q32009
Q22010
Q12011
Q42011
Q32012
Q22013
Q12014
Q42014
Q32015
Q22016
InterestIncome- InterestExpenseNet Interest Margin
Source:FederalFinancialInstitutionsExaminationCouncil3
NIMsfallbelow3%
©2017HarlandClarke.Allrightsreserved.
WhatImpactsNetInterestMargin?
Short-terminterestrates
Geography
● Lesscompetitiveareasmeansafinancialinstitutionmayoffer
lowdepositratesandchargehighloanrates
Accountholdergrowth
● Deeperrelationships
Loandemand
● StrongloandemandcanimproveNIMsduetoLoanYields
4 ©2017HarlandClarke.Allrightsreserved.
HistoricalEfficiencyRatios
64.62
61.16
61.8 61.45
62.8862.26
60.94
59.75
60.7860.27 60.06
57.95
57.64
65.31
52
54
56
58
60
62
64
66
Q32013 Q42013 Q12014 Q22014 Q32014 Q42014 Q12015 Q22015 Q32015 Q42015 Q12016 Q22016 Q32016 Q42016
Efficiencyratioisameasureofafinancialinstitution’soverheadasapercentageofitsrevenue
Source:BankRegData.com
5 ©2017HarlandClarke.Allrightsreserved.
WhatImpactsEfficiencyRatios?
Decreasedcosts
Geographies
Improvedworkflows
● Economiesofscale
o Thecostofproducing/servicinggoesdownwhileoutputgoesup
Increasedrevenue
● Loandemand
● Noninterestincome
6 ©2017HarlandClarke.Allrightsreserved.
LoantoDeposit/ShareRatios
69.31%
68.90%
69.46% 69.29%
68.59%
68.91%
70.63%71.09%
71.54%
70.95%
71.83%71.19%70.90%
69.21%
71.66%
74.04%
74.91%
73.30%
75.52%
77.53% 77.50%
76.08%
77.87%78.60%
65%
67%
69%
71%
73%
75%
77%
79%
Q4- 2013 Q1- 2014 Q2- 2014 Q3- 2014 Q4- 2014 Q1- 2015 Q2- 2015 Q3- 2015 Q4- 2015 Q1- 2016 Q2- 2016 Q3- 2016
Banks CreditUnions
Source– BankRegData.comandNCUA
7
LoanToDepositRatio– Q32007– 93.1%
©2017HarlandClarke.Allrightsreserved.
SalesSources
59%
21%
12%
6%2%
Plannedtoopenanaccountw/oprompting
Thinkingofopeningaccountandpromptedbyreceivingsomethingfrombank
Thinkingofopeningaccountandpromptedaftertalkingtosomeoneatbank
Notthinkingofopeningaccountuntilpromptedbysomeoneatbank
Notthinkingofopeningaccountandpromptedafterreceivingsomethingfrombank
8
Source: 2013 Gallup U.S. Retail Banking Survey
©2017HarlandClarke.Allrightsreserved.
DirectMarketingIsEffective
RESPONSERATES
Source:2015DMAResponseRateReport
9 ©2017HarlandClarke.Allrightsreserved.
DirectMailHouseList
DirectMail
ProspectList
Phone
44%ofmarketersusethreeormorechannelsMostpopular:email|directmail|socialmedia
9– 10%
1%
3.7%
COSTPERACQUISITION MAILTYPE(ResponseRates)
$11-15
DirectMail
Mobile SocialMedia
PaidSearch
InternetDisplay
$19 $16-18$16-19
$21-30
$41-50
Over-sized
Envelopes
Post-cards
Dimen-sionalMail
Catalogs
Letter-sized
Envelopes
5%4.25% 4% 3.9%
3.5%
ApplicationResponseRate
10
1,224 1,1731,274
1,362
995
1,408 1,424 1,459
1,655
1,1411,051 1,086
949
55 56 71 64 48 71 66 57 67 53 37 32 100
200
400
600
800
1,000
1,200
1,400
1,600
1,800
Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16
LettersMailedvs.LoanApplicationsSubmitted
MonthMailedCount MonthResponseCount
©2017HarlandClarke.Allrightsreserved.
Source:Harland Clarke Response Report Data for Marketing Initiative
SuccessRatio
11
4.5%4.8%
5.6%
4.7% 4.8% 5.0%4.6%
3.9% 4.1%4.7%
3.5%3.0%
1.1%
0%
3%
6%
9%
12%
Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16
LettersMailedvs.LoanApplicationsSubmitted
©2017HarlandClarke.Allrightsreserved.
Source:Harland Clarke Response Report Data for Marketing Initiative
ApplicationResponseRate
12 ©2017HarlandClarke.Allrightsreserved. Source:Harland Clarke Response Report Data for Marketing Initiative
CostPerApplication
13 ©2017HarlandClarke.Allrightsreserved. Source:Harland Clarke Response Report Data for Marketing Initiative
Q&A
14
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SteveNikitasSeniorStrategyDirector
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