Transforming Deposit Retention: A Comprehensive Case Study with Micronotes

By Xav Harrigin-Ramoutar

In today’s competitive banking industry, community banks face a constant challenge: retaining customer deposits. With numerous alternatives available, maintaining loyalty and preventing fund outflows are critical for sustained growth. Micronotes’ Exceptional Deposits solution offers a powerful tool to address these challenges, leveraging analytics and personalized engagement to enhance deposit retention. This case study highlights how a community bank successfully used Micronotes to achieve remarkable results in deposit retention and wealth management growth in a matter of 2 months.

Introducing Micronotes’ Exceptional Deposit Solution

Micronotes’ Exceptional Deposit solution uses statistics to predict which customers are moving through a life event, manifest by an anomalous large deposit . By identifying these customers immediately, banks and credit unions can engage customers moving through a life event proactively, offering personalized solutions to both help customers and retain their deposits. This proactive approach ensures that banking providers can address potential withdrawals before they occur, transforming at-risk customers into loyal accountholders.

Benefits of the Exceptional Deposit Solution

• Catching Life Events: Accurately forecasts life events identifying those who likely need help, which their primary depository institution must deliver to stay ahead of potential fund outflows.
• Personalized Engagement: Delivers tailored interviews large depositors addressing their specific needs and concerns. Personalized engagement ensures that customers feel valued and understood, enhancing their loyalty to the bank.
• Proactive Retention: Engages customers before they decide to withdraw their deposits increasing the likelihood of retaining the customer and their deposits. Proactive retention strategies are essential for maintaining a stable and loyal customer base.

Challenges of Customer Retention in Community Banking

Customer retention in community banks is complex due to several factors:

• Competitive Offers: Customers have numerous alternatives, making it easy to switch banking providers. Community banking providers must differentiate themselves to retain customers.
• Customer Dissatisfaction: Unresolved issues or unmet expectations can lead to attrition. Addressing customer needs promptly is vital to prevent dissatisfaction.
• Changing Financial Needs: Customers’ financial situations and needs evolve over time, requiring continuous engagement and adaptation. Banking providers must be agile and responsive to these changes using technology.

Micronotes’ solution addresses these challenges by providing banks and credit unions with tools to understand and respond to customer and member needs proactively. By leveraging data, insights, and automation, community banking providers can implement effective retention strategies tailored to their customers’ needs.

Case Study: Exceptional Deposit Campaign

Campaign Overview

On March 1, a client community bank launched a campaign targeting personal banking customers who made atypically large deposits. These customers, identified through Micronotes’ analytics, received personalized interviews via the online and mobile banking platforms. The goal was to engage these customers and help them find solutions to retain their deposits within the bank.

Key Insights

Micronotes discovered that 54% of these customers typically withdrew their deposits within 90 days, if not contacted. By engaging with them promptly, the bank aimed to retain these significant deposits.

Campaign Results (March 1 – May 7, 2024)

• Leads Generated:
  • 43 warm leads
    • 32 for Certificates of Deposit (CDs), 11 for investment opportunities with LPL Financial advisors
  • 31 cool leads
    • 24 for CDs, 7 for investment opportunities
• Conversions:
  • Warm Leads: Over $1.1 million in new CD purchases
  • Cool Leads: Over $500K in new CD purchases

The campaign’s success in generating leads and converting them into new CD purchases highlights the effectiveness of Micronotes’ solution in retaining customer deposits.

Detailed Engagement Breakdown

• Warm Leads:
  • 28 customers requested email information on CDs
  • 4 customers preferred a call about CDs
  • 10 customers asked for more information on investments and were sent a link
  • 1 customer requested a call about investments
  • Additionally, 24 customers were interested in CDs but declined further contact, and 7 customers were interested in investments but did not want to be contacted

Conversion Metrics

• Warm Leads:
  • 9 accounts without prior CDs now hold a total of $1.055 million in CDs
  • 1 account increased its CD balance by $44,000
• Cool Leads:
  • 3 accounts without prior CDs now hold a total of $525,000 in CDs
  • 1 account increased its CD balance by $31,000

These conversion metrics demonstrate the tangible impact of the campaign on the bank’s deposit retention efforts. By converting warm and cool leads into substantial CD balances, the bank successfully retained significant funds, more than half of which would otherwise have been withdrawn.

User Experience

The campaign’s interface within mobile banking was designed for seamless interaction. Customers could choose options like ‘Call me’, ‘Email me’, and ‘Not now’, each triggering specific follow-up actions by branch managers. This intuitive design ensured a smooth user experience and effective engagement. The ability to interact with the campaign through familiar digital channels made it easy for customers to respond and engage with the bank’s staff and products.

Verdict

The Exceptional Deposit Campaign effectively demonstrated the power of Micronotes’ data-driven engagement strategy in retaining deposits, one of hundreds of powerful use-cases. By retaining significant deposits and fostering deeper customer relationships, the campaign showcased how analytics and personalized engagement can drive positive outcomes for community banks.

Community banking providers looking to enhance their deposit retention strategies can benefit significantly from Micronotes’ innovative solutions. By leveraging advanced analytics and proactive engagement, banks can stay ahead of potential withdrawals and build stronger, more loyal customer relationships.

Call to Action

Discover how Micronotes can transform your deposit retention strategies. Contact us today or visit our website for a detailed overview and to schedule a demonstration of our innovative solutions. Let us help you turn potential challenges into opportunities for growth and customer loyalty.