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First Market Bank - Market Share Business Overview Since opening in November 1997, First Market Bank, which is primarily owned by Ukrop's Super Markets, Inc., has carved a niche for convenient banking services. It provides a full range of financial products and solutions, including commercial, small business banking and investment options. The Bank has grown rapidly to 30 locations in the Central Virginia area; in August 2003, it reached 1 billion dollars in assets after only six years in existence, compared to a typical banking growth of 500 million after five years. Ukrop's Super Markets is a very community-oriented company and this philosophy also has been embraced by First Market Bank - making it important to both companies to reward loyal customers. Katie Gilstrap, Assistant Vice President, Marketing Manager for First Market Bank, explained, "We wanted to reward customers that were both banking with us and shopping in Ukrop's stores. To accomplish this, we created the Market Share Program with a points-based reward system: Participants earn one point for every $10 in grocery purchases at Ukrop's; one point for every $100 in deposits or loan balances at First Market Bank; and one point every time they use their Market Share Check Card for purchases around town. At the end of each quarter the points are totaled and a corresponding gift voucher is mailed to each participant to reward them and create an incentive for them to continue their participation in the program." Program Overview Gilstrap notes, "Market Share participants are our best customers - they have more First Market Bank accounts, maintain higher balances, use more banking services, and stay with the bank longer than non-participants. We want to retain as many of these participants as possible, encourage more people to join the program, and drive increased levels of business to both companies." Market Share Program participants had traditionally received their bonuses via a standard format letter with a detachable voucher at the bottom. It was clear that this quarterly mailing could be enhanced to be a more powerful marketing vehicle with a strong call to action for the recipients. Program Objectives - Reward good customers
- Retain customers and Market Share participants
- Encourage participation in the Market Share Program
- Increase business at both Ukrop's and First Market Bank
- Improve overall look and feel of Market Share
Description of Services Provided by DIG DIG designed a tri-fold template for the mailer which includes variable data about the customer such as their name, address, details of their point totals, targeted sales messages and discounts based on their unique bank and store usage patterns. Customers receive targeted offers based on their previous banking history. Says Gilstrap, "We are careful to display our knowledge of each individual to make the piece as relevant as possible. If they already have an equity loan we don't include data about one. We also have different messages for separate geographies, such as information about the nearest bank. Even the address panel has personalized teasers to indicate that the mailer contains the gift voucher and isn't junk mail. New customers get a welcome to the program, here's your first reward message." Each quarter, DIG creates a data report tabulating redemption rates for the previous quarter, highlighting program strengths and focusing on opportunities for improvement. This follow-up reporting provides a feedback mechanism to refine messaging and to ensure that Market Share is meeting its goals. Gilstrap observed, "We discovered that new customers were not redeeming their coupons as frequently as longer term members, so by adding a message to the address panel, to indicate that the reward coupon is included, helped encourage more members to become active in the program." Results - Improved quality and content of quarterly loyalty program mailing which helps retain customers and increases levels of business
- Voucher response rates range from 27.17% to 86%
- Redemption rates more than doubled from 2002 to 2004
- Ability to deliver customized marketing messages directly to individual participants
- Dramatically increased information on consumer's buying and banking behaviors
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