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Getting it Right: How To Drive Effective Customer Treatments

The development of customer treatments, in which banks create targeted offers, can significantly help attract new customers and augment relationships with current ones. Banks must, however, design the treatments with care so that they grow the franchise by identifying and attracting quality customers and deposits.

Such insights are valuable to banks as they compete to attract new customers in an era of rising interest rates, increased competition for deposits and a shift to online activity. It is especially the case because banks must find a way to differentiate themselves with customers who previously may have selected a checking account or savings account based on branch location.

Novantas conducted customer research in February, analyzing the impact of treatment structures on different segments of consumers for their checking accounts and liquid deposits.


No matter the type of account, ineffective treatments carry a long list of bad outcomes. Poorly-designed offers don’t attract customers beyond organic acquisition, potentially increasing acquisition costs. At worst, offers will be grabbed by existing customers, resulting in the cannibalization of balances without any boost to deposits. An offer that is too general, meanwhile, risks the potential of attracting poor-quality deposits that can drive up the cost of balances. And poor offer design can result in limited activation, resulting in wasted investment.

In working with clients, Novantas has identified seven areas that organizations must focus on to drive effective deposit campaigns:

  1. Objective Setting — determine primary goals for the promotion, including value compared with volume and near-term focus versus long-term aims    
  2. Targeting — develop analytics to ensure the right offer goes to the right customer or prospect
  3. Offer Structure — Identify the currency and conditions to meet the objective while minimizing pitfalls
  4. Pricing — determine preferred incentive currency, such as rate or cash — and the appropriate levels to generate sufficient response from the targets
  5. Messaging — include a call to action with the design so that it appears relevant to the consumer and reduces reliance on the currency offered
  6. Channel Delivery — choose the right method of delivering the offer for the greatest impact
  7. Customer Planning — assess the most effective sequence, timing and persistence of offers to maximize response

A robust treatment planning and analytics process encompassing all seven areas leads to increased revenue and decreased costs (Exhibit 1).



We have all made aspirational resolutions about our body, mind and spirit to drive ourselves in the ‘right’ direction, only to fail because our resolutions didn’t address the reality of our lives. Similarly, banks aspire to focus on engaging customers in a way that drives longer-term value, while near-term budget objectives may demand resources (Exhibit 2). Organizations that are clear in their objectives for specific customer treatments drive better results over others. Treatment objectives can be quantified in time, value driver, and target level dimensions (such as the need for 10,000 checking accounts in six months, a desire to grow deposits by $1 B by year end, or an interest in increasing the adoption of mobile check deposit by 20% in a particular segment).



Given the objective, identifying the most valuable customers and prospects to achieve the objective is critical. A valuable target generates the greatest expected return on the cost of the treatment. This depends both on the value of a consumer response and their propensity to respond.

As an example, Novantas targeting and treatment research reveals that while some segments are highly responsive to offers, they may not always achieve an objective. Novantas found that a consumer’s rate sensitivity, propensity to shop, and deal orientation has a significant impact on potential response rates to Checking and Savings/Money Market offers.

One of the consumer types that emerged in the research is a segment we identify as the “Always-On Shopper.” This consumer is attuned to the rates offered by different banks and is always looking for the best deal. This consumer also believes it is worth the effort to shop and switch banks in order to get better rates. Always-On Shoppers are not only more aware of offers than others, but they also respond more frequently to lower offers than other shoppers.

While Always-On Shoppers are attracted more easily, the quality of their deposits may not be as valuable to the bank, especially if they can be lured to another bank for a better offer down the road. A bank may be better off, therefore, receiving a lower response rate to the offer if it is targeted with more precision or structured with more conditions so that it can ensure better economic returns.

The Always-On consumer is unusual. Indeed, two larger segments of consumers are relatively passive to most deposit offers for different reasons:  Bank Loyalists, while quite engaged managing their day-to-day banking accounts daily, do not feel it is worth the effort to shop for a new checking or savings account, preferring to keep at all accounts at the same bank. Another segment, called Banking in Background, passively manages deposit accounts and are least interested in shopping for deals in banking relationships or elsewhere.


Novantas treatment research also compared offer currency (i.e. cash, rate, points, other bank discounts) against conditions (i.e. opening a companion account, minimum deposits, and qualifying transactions) to receive incentives. Both options can be structured to meet the overall objective.

First, consumers prefer and respond to some currencies more than other currencies, even when equivalent values. For example, cash is king; consumers respond more favorably to a $200 cash offer than to $200 in travel points or bank discounts. Secondly, the research confirmed that consumers are willing to meet certain requirements to receive the incentive. While these conditions reduce overall response rates, Novantas behavioral analysis shows the retention of deposits and activation are significantly higher from consumers who maintain these behaviors.

Understanding the interplay between consumer preference for offer structures and how they drive post-promotion results will drive the economic success and sustainability of an organization’s customer-treatment strategy. Such programs often aren’t pure science; they need constant tinkering and assessment in order to win the most customers.

Karen Graham
Director, Chicago

Hank Israel
Director, New York

For more information, contact Novantas Marketing

+1 (212) 953-4444

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