A case study of the contribution model: Pioneer Bank, Roswell, N.M.

• Author: Griesel, Achim
• Position: Brief article

In 2008 Pioneer Bank, a $640-million, 15-branch bank based in Roswell, N.M., decided to follow the contribution philosophy as part of its effort to grow through customer acquisition. The bank's strategic approach was driven by product and policy changes.

The bank teamed up with an outside company to maximize the capacity it had in its branches without adding any significant cost. It implemented a checking product lineup based on the contribution cost model and reviewed bank policies to determine any other hurdles for growth. The bank trained the entire staff--and continued to do so--and started marketing through direct mail and in-branch merchandising. Included in its marketing plan were a few high-profile events used to drive more foot traffic.

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Since 2008, the bank grew its customer base by 56 percent per branch, adding 8,000 net new customers. The increase...