Build deposits with direct mail.

• Author: Turner, Jim
• Position: Direct Mail Essentials

When your bank is attempting to attract deposits, media other than direct mail--such as newspaper or radio--often are the first choice. These media cost less than mail and have much shatter production times to accommodate rapid interest-rate changes. Deposit products usually don't need the lengthy copy formats that direct mail provides.

But there are times when direct mail is the preferred medium for deposit marketing, especially if you are targeting a specific audience, for example, reaching seniors to market certificates of deposit.

Here's a guide to raising deposits by mail for various products:

Checking accounts: Typically, this is the most challenging deposit product to sell by mail. One reason is that consumers usually keep relatively low balances in checking, making it difficult for the bank to justify the expense of direct mail. This habit also gives the consumer little reason to move for a rate incentive because of the relatively small balance involved. Consumers also are reluctant to move their household checking frequently because of outstanding checks and the cost of printing new checks.

Nevertheless, it can be sold by mail. You can pay a premium interest rate on interest checking to move larger-balance customers. For this purpose, targeting middle-age consumers with higher incomes works well.

Incentives such as free checking or free checks also work, especially when used in a new branch opening. And, you can sell checking effectively by bundling it with other products such as a debit card, overdraft protection or online banking.

Savings accounts: Because most households have a savings account, they are receptive to direct mail offers. Of course, rate is the primary incentive, so you might consider paying a guaranteed premium interest rate for a specific time period. Because savings accounts have little transaction activity in most households, consumers will use banks relatively distant from their home. Therefore, you can expand your mail list to go beyond your usual geographic market.

Because a basic savings account doesn't require long copy or extensive graphics, a postcard usually will be sufficient Make the rate prominent, of course. However, if you want to include an "open-by-mail-form," use a standard business envelope.

Money market accounts: The relatively large balances consumers carry in...