Savings Mobilization Marketing Program

Savings Mobiliza.on Marke.ng Programs Ferdinand O. Sia RBAP‐MABS 2011 RBAP‐MABS Regional Roundtable Conference Hya= Hotel & Casino, Manila November 9, 2011

Savings Mobiliza.on Marke.ng Programs RBAP‐MABS Regional Round Table Conference 9 November 2011 2

Savings Mobiliza.on Part I: Why culJvate microdeposits? Part II: MarkeJng Programs for Savings MobilizaJon a.  Raﬄe PromoJon b.  Kiddie Savers Club c.  Public Events Part III: MABS Banks Performance 3

PART I: WHY CULTIVATE MICRODEPOSITS? 4

1. Long Term View: Deposit balance increase over .me PHP Deposit History of a Typical Depositor in 2000 70,000 58,978 60,000 50,000 40,000 30,000 18,730 20,000 8,260 10,000 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 •  People’s income increase as they advance in the life cycle •  InvesJng in micro‐depositors will present long term beneﬁts to the bank 5

2. Marke.ng Perspec.ve: Wide deposit base expand business opportuni.es for the bank •  SomeJme in the future, a depositor will need ﬁnancial services •  A deposit account presents an opportunity to build a lasJng relaJonship with clients •  Trust and good relaJonship make it easier to oﬀer other products and services to depositors 6

3. Financial Impact: For banks with more loans than deposits, more deposits translate to more income In Million Loans vs. Deposits PHP 800 Shortfall700 funded with Bills Payable600 Loans at 9%500 Potential400 savings Deposits 300 200 Savings Account100 only pays 1% 0 Jan‐04 Dec‐04 Nov‐05 Oct‐06 Sep‐07 Aug‐08 Jul‐09 Jun‐10 Dec‐10 7

PART II: MARKETING MICRODEPOSITS 8

a. Savings Booster Project: Raﬄe Promo.on 9

Result 1: Deposits grew rapidly with promo.on Deposit Balances (PHP mn) Deposit Growth Rate 205 15% 169 188 161 163 12% 10% 7% 8% Before 18 Before 12 Before 6 During Aêr 6 Before 18 Before 12 Before 6 During Aêr 6 months months months months months months months months No. Accounts 6,426 No. Account Growth Rate 11% 5,831 4% 5,641 5,606 5,686 ‐5% ‐4% 0% Before 18 Before 12 Before 6 During Aêr 6 months months months months Before 18 Before 12 Before 6 During Aêr 6 months months months months Notes: (1) Growth rate is based on average of monthly year-on-year growth rates for the study duration. (2) Deposits refer to voluntary deposits only. 10

Result 2: More depositors par.cipated and their balances increased Average Core Deposit Average Core Deposit Growth Rate 32,180 18% 31,914 29,671 12% 11% 29,105 28,556 8% ‐1% Before 18 Before 12 Before 6 During Aêr 6 Before 18 Before 12 Before 6 During Aêr 6 months months months months months months months months Proportion of accounts that qualified for raffle promotionSavings Deposit 2008 2009 2010 (raffle year) New Depositors 6% 5% 12% Repeat Depositors 8% 10% 10% Note: For comparison purposes, calculations were made on hypothetical proportion of accountsqualified for raffle promotions for 2008 and 2009 as if raffle promotion existed in those years. 11

b. Savings Booster: Savings Account for Young Depositors •  Target guardian and minor depositors •  Establish relaJonship with potenJal clients at very young age •  AcJviJes and freebies make the product more meaningful to depositors 12

Beneﬁts from Kiddie Savers come in various forms Short-term benefits:Costs: •  Increase business with parents•  Lock box •  Earn public goodwill•  Freebies •  Brand marketing•  Club activities Long Term benefits:•  Marketing & Promotions •  Kiddie depositors eventually•  Special administration avail other bank products •  Overall customer loyalty Investment Return 13

c. Savings Booster: Public concert with celebri.es •  EﬀecJve in a=racJng new micro‐deposit accounts •  Bank may ask for a minimum deposit to serve as entry Jcket •  Choice of celebriJes will depend on the taste of the local market •  Performers from local market are equally eﬀecJve 14

PART III: MABS BANKS PERFORMANCE 15

Good News 1: Majority of MABS member banks are more proﬁtable than the industry 25% Selected Member Banks’ Proﬁtability (2010) N 20% J O Return on Equity (ROE) G E 15% I L Universal and Commercial B Bank Industry Rural Bank Industry 10% Thri^ Bank F H Industry A D K Higher than 5% C industry Lower than M industry 0% 0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% 4.0% 4.5% Return on Asset (ROA) 16

Good News 2: Opportuni.es s.ll exist to further improve proﬁts by mobilizing deposits Small Banks Large Banks 0.9 3.5 0.8 Balanced Porjolio Line  Balanced Porjolio Line  3.0 0.7 J Deposits (in Php billions) 2.5 0.6 A Deposit (in Php billions) 0.5 B 2.0 C K 0.4 1.5 E D L M 0.3 F 1.0 0.2 G N 0.5 0.1 I H O ‐ ‐ ‐ 0.2 0.4 0.6 0.8 ‐ 0.5 1.0 1.5 2.0 2.5 3.0 3.5 Loans (in Php billions) Loans (in Php billions) Most deposit-loan ratios are above 0.85 Note: Loans in this slide refer to gross loans. 17

Summary •  Microsavings serve as long term investments to generate funds for loans, obtain new clients and increase profits •  Raffle promoJons, Kiddie Savers Programs, and public concerts can boost deposits substanJally for the bank •  OpportuniJes sJll exist among MABS member banks to further improve profits by mobilizing deposits 18

Savings Mobilization Marketing Program

by MABSIV on Nov 22, 2011

Accessibility

Categories

Upload Details

Usage Rights

1 Embed 18

Statistics

Savings Mobilization Marketing Program — Presentation Transcript