The battle lines were drawn about three years ago when the housing market crashed and taxpayers helped bail out the mega-banks.
Since then, it’s been a war fought on several fronts.
I’m still not certain who won the battle over overdraft protection fees. To me, it appears to have been a draw with each side losing something. Yet, many consumers are still paying exorbitant ODP fees.
If you don’t believe consumers are passionate when it comes to new banking fees and restrictions, read the story below. It’s a reminder that you should check and update your branch and corporate security procedures.
In mid-October, a Lincoln, Nebraska, woman called the customer service phone line for the regional bank where she had her checking account. She discovered a fee on her statement and asked about it. When told it was a new fee the bank instituted, the woman became angry. As the report stated, she “said her bank was ripping her off.” She told the service rep she was on her way to the bank with a bomb and she would blow up the office.
Two short articles in the business section of Tuesday’s newspaper support my headline that higher fees and prices are for losers.
First, Reed Hastings and his once high-flying Netflix business continue losing large numbers of customers while watching the price of Netflix stock drop like a rock.
Mr. Hastings’ sin was to dramatically increase the price loyal customers pay to rent movies both online and via live streaming. Adding insult to injury, he did a poor job of communicating the reason for the jump in price.
Payday lenders are the non-banking companies that have made the biggest inroad into what was once financial institutions’ territory. Now, some credit unions in Nebraska have agreed to offer consumers an alternative to those high-priced payday loans.
Payday lenders are often blamed for taking advantage of low-income citizens by offering easy cash loans for short time periods at high interest rates. Statistics show the average payday loan in Nebraska, this blog’s home state, has a 460% APR. Fifteen states have outlawed payday loans.
Since the mid-1980s, free checking was king of the hill until a few bullies showed up a couple of years ago and attempted to throw it off the hill.
These bullies go by the names of Chase, Bank of America, Citibank, and Wells Fargo.
We know they are bullies by the way they treat others – particularly those who are smaller, including consumers, community banks, and credit unions.
Comparison charts were an integral part of direct mail marketing packages that promoted free checking accounts during the 1980s and ’90s. Then, the charts’ usefulness dipped until they became pale shadows of their attention-generating predecessors.
Is it time to bring back comparison charts?
Is your financial institution having trouble opening new accounts? Maybe you should take a cue from CitiBank and simply open new accounts for your customers and tell them later.
CitiBank says it’s only an enhancement to the customer’s credit card account, but see if you agree. Customers with credit cards are receiving replacement cards many months before a card’s expiration date. The envelope includes two similar-looking credit cards and a customer can easily be fooled into thinking they’re identical.
But during the phone call to activate the replacement card, the recorded voice says, “You want to activate both cards. Is that right?” The easy answer is “yes,” just to move along. But then, the customer hears, “Please say or enter the account number of the second card.”
“Good initiative – poor judgment.”
I can’t remember how many times I heard this statement from the person in charge during my three years in the Army over 40 years ago.
It was burned into my memory so that I would never forget the importance of due diligence before making any decision.
Well, it definitely applies to the headline at the top of this credit union ad appearing in last Sunday’s newspaper.
This headline is the opening line of a British poem from the early 1600s that modern consumer activists hope will be stuck in the minds of mega bank executives after November 5, 2011.
The Fifth of November poem refers to the date when Guy Fawkes tried to blow up the British Parliament building with 20 barrels of gunpowder.
Are you one of the millions of Americans who dread receiving mail during January and February?
For many of your customers, January is the toughest month of the year – followed by February and March.
Why is this?
Disruptor marketing is used effectively by companies outside of banking and I have an example that shows the strategy can be so effective that the targeted company will backtrack on the decisions that generated customer anger and the competitors’ disruptor campaigns.
One of the hottest topics in the financial services industry, a topic that’s reached mainstream awareness, is the market disruptions caused by big banks’ addition of debit card fees.
We apologize for an inconvenience you might have had trying to access our site.
Instead of investing more money in racy Super Bowl commercials, maybe hosting service provider GoDaddy should put some money into quality equipment and talented technicians.
If you tried to access this blog, you’ve been unable for most of the past week thanks to the host server breakdown. The service disruption was first noticed Sunday evening, October 9, by one of the ACTON Marketing staff members.
I hope you have your “disruptor” marketing campaign ready to implement.
By the way, does your bank or credit union have a marketing plan to grab more than your share of these disgruntled, angry banking customers who are leaving Bank of America and other big banks?
First, they dropped free checking.
I tossed the envelope aside. Typically, when I tote my mail from the box into the house, I go through all of it immediately. But I ignored this mail piece.
First, I didn’t recognize who it came from. The yellow outer envelope looks like a marketing piece for DHL, a delivery company. My experience with DHL delivery services are 100% negative, so I’m not interested in anything that company is selling.
Also, I knew I didn’t order anything that DHL would deliver, and obviously the postal carrier dropped off the envelope, so I’m not fooled.
I bet a lot of financial services marketers are sitting on their hands and missing an amazing opportunity to open more accounts and increase their customer/member bases.
Are you one of them?
I heard news of a 21-branch credit union in Arizona that reported a 20% increase in account openings after news came out that Bank of America is initiating a $5 monthly debit card fee. A credit union official said one branch saw a 50% spike.
At first I was shocked by the number of bank ads appearing in the local weekly business journal.
I was shocked because for the past year, I’ve been lucky to find one or two bank and credit union ads during an entire week in Sacramento’s only daily.
But the more I thought about it, it started making sense to me.
While so many banks seem prepared to follow whatever Bank of America does (even though B of A hasn’t been a good example of how to do most anything) Arvest doubles down.
Not only will they continue to offer free checking, they will also offer a free debit card, free online and mobile banking, and a debit card rewards program. Arvest also announced they will lower their already low overdraft fee to $17 on November 7, 2011.
I’ve been reading the 56-page National Checking Account Review that was prepared for the recent ABA Best Practices Conference. It’s packed with useful information for financial services marketers — whether you’re at a bank or a credit union.
Most of the pages show examples of big bank checking programs and samples of their marketing materials. You can see what some of your competitors are doing to try to attract your customers — or why you can draw their customers into your branches with your superior checking products.
Frankly, I’m confused.
Is it SkyBlue Checking or SkyBlue Free Checking?
After visiting a couple of media websites, reading the bank’s press release, visiting the bank’s website and its Facebook page, I’m confused about the name of the bank’s new checking account.
Belmont Savings Bank, Belmont, Massachusetts, made the news two weeks ago when it introduced its first free checking account.
When you’re ready to open a new branch location, what’s one important thing you do? Send a grand opening announcement to potential customers in the area surrounding your branch.
Now, what’s another important thing you should do that you’re likely to overlook? Notify local business owners that they have a new choice for their banking services.
Business clients are a forgotten prospecting field, it seems, for most financial institutions. How often does a print or broadcast ad, mail campaign, or other promotion focus on business owners? When was the last time you saw one? When was the last time your bank or credit union ran one?