Culturally Targeted Checking Campaign Drives Higher Deposits

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Category: B2C

Type: Acquisition 

Channel: Direct Mail

Industry: Banking

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Challenge:

 

In 2006 Union Bank wanted to test segmenting acquisition campaigns for targeting new Latino customers. They had previously included the Latino audience in its mass marketing strategy and wanted to find out if results could be improved with Latino-specific creative. Union Bank did not have a bilingual website or a bilingual call center; however, it did have at least one bilingual customer representative in each of its branches.

 

Solution:

 

In profiling Union Bank’s customer base, we found that acculturated Latinos were much more likely to become Union Bank checking account customers than non-acculturated Latinos. This was due in part to federal documentation requirements and cultural norms regarding banking. Although most acculturated Latinos in Union Bank’s service area spoke fluent English, we created a split test (along with a hold-out group) to compare English-only creative against bilingual creative to see which performed better. Both packages had a $75 cash bonus offer for opening up a checking account. Prospective customers were targeted to households in select ZIP codes with a high percentage of acculturated Latinos.

 

Result:

 

Although both direct mail packages had almost an identical response rate, the bilingual package acquired Latino customers who averaged 30% higher account balances than Latino customers who responded to the English-only package. By speaking to these customers in their preferred language and demonstrating a commitment to their community, Union Bank was able to win over more of their business. Although the bilingual package cost slightly more to produce than the English-only version, the difference in the estimated lifetime value of the Latino customers with higher balances was more than enough to compensate the incremental cost per acquisition.

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