In Deposit Acquisition, There Are no 'Easy Buttons'

As human beings, we are conditioned to look for the simplest solutions. We want to push a button and solve a problem. However, in business – and in life – there are rarely silver bullet answers for our challenges. The reality is that there are very few substitutes for doing the hard work.

We are seeing this play out for financial institutions right now, as banks and credit unions seek that silver bullet answer for generating deposits.

We have been working for banks and credit unions, on staff or as consultants, for more than 100 years, and have seen our share of pitches for these “fast fixes.” As a company who puts our clients’ success first, if there is a solution that helps them be more successful, we say, “buy it.” When it comes to deposits, however, we’ve seen over and over again that off-the-shelf solutions don’t live up to those promises. The numbers speak for themselves. The challenge to grow deposits requires that all efforts are taken.


There are fewer accounts in play than ever. What does this mean? Well, you’re either going to need to better refine your targeting – or buy a bigger arrow. With such a small percentage of customers switching providers, it’s important to start by tending to the customers that you have. Expansion remains a powerful tool in the deposit-generating toolbox.

Of those customers switching FIs, nearly two-thirds do so for reasons other than products or services. Consider your customers’ desire for more personalized financial advice and incorporate marketing messaging that addresses major life milestones (marriage, a new job, or buying a home, for example) in your deposit-growth efforts.


While customers are increasingly mobile-dependent, branches are still being used at least once a month by 86% of customers – and those people don’t want to travel far for the service they need. There is a  “silver bullet” approach on the market that employs a “spray and pray” technique, blanketing a large geography with checking offers. FIs can be far more effective with their marketing dollars and resources by targeting their efforts within their trade areas.


Again, don’t forget your current customer base. Campaigns targeting these customers enjoy a new account open rate 25x that of new customer acquisition campaigns. Simply targeting customers without checking accounts within a tightly defined trade area can generate marketing ROI of more than 8:1.


When any FI asks what is the first thing they should do in order to grow deposits, the simple answer is: Target your maturing CD customers. Simply reaching out to customers with expiring CDs generates reward for very little effort. Couple a targeted direct mail offer with a focused calling program and watch ROI increase exponentially.

Recently, a client shared with us that although they had been targeting maturing CD customers for quite some time, internal processes had required that customers with IRA CDs be removed from those efforts. In a single year, they saw tens of thousands in balances leave the bank when those CDs matured – simply because those customers weren’t included in marketing efforts. A chat with their operations team, an adjustment in procedures – and now their efforts target the larger pool of maturing CD customers. And the results speak to its value. On average, FIs can see an ROI of 24:1 on their maturing CD efforts.


By no means are we saying to ditch your acquisition efforts! There’s still success to be had for community FIs in the acquisition game. It just takes some work. An integrated approach consisting of direct mail and community events rather than a traditional direct mail-only program triples your checking account acquisition. This breaks down to about 17.2 new households per 1,000 pieces of direct mail versus 2.2 new households with the traditional “free-plus-a-gift” approach. The caveat? It takes time and resources to plan and staff these events, and many FIs don’t execute it fully, if they execute at all. Time and again, we’ve seen results that exceed industry averages when an FI embraces this challenge and enjoys the opportunity to engage and interact with its community and prospects. Having the right event and the right people are crucial to the success of the program. We’ve seen FIs plan events that draw a large crowd – and we’ve seen them miss their opportunity when staffers spend the time talking to each other rather than their prospects. 

The absence of a silver bullet does not indicate the absence of opportunity. The opportunity exists – the “Easy Button” does not. Looking at your specific situation and employing the right solutions will guarantee more deposits than an off-the-shelf silver bullet solution.

 Do you understand your FI’s deposit opportunity? Let us help!

Let the Galapagos team analyze the deposit opportunity in your customer base and markets. Simply send us an email or call 616.608.7359 and ask to speak with Jeremy Kane.