Wednesday, February 10, 2010

Targeting New Movers for Enhanced Growth

According to the U.S. Census Bureau, the national mover rate declined from 13.2% in 2007 to 11.9% in 2008 - the lowest rate of moves on record. Still, over 30 million people changed residences during this one year period, representing a powerful opportunity for new customer growth. In fact, even though the demographics of movers has skewed younger, with a higher percentage of renters moving, this segment continues to outperform all other prospect universes from a new customer acquisition perspective.

While many of my clients continue to focus on checking offers for the new mover segment, more banks are realizing the benefits of promoting products such as money market accounts and even equity credit and investment services.
This is because people tend to more thoroughly evaluate their financial position during the three months surrounding their move, with more than 50% changing and/or opening new financial relationships during this period. It is believed that the process of portfolio evaluation has even increased over the past 18-24 months as the mortgage process has become more stringent.

The keys to reaching this transitional segment include; 1) being first in the mailbox of the new mover after their move when there is less competing clutter, 2) building a system for efficient and ongoing processing of new names and delivery of offers, and 3) measuring the impact of your new movers program and testing offers and timing.

Historically, many retailers such as Bed, Bath and Beyond, Pottery Barn, and local welcome wagon programs filled mailboxes with postcard format offers immediately after a household's move. Recently, however, many of these same retailers are opting to send much larger catalogue style communications 1-3 weeks after a move is completed. I also have seen some financial firms improve their ROI by using Standard Class mail as opposed to First Class since the difference in delivery dates by the post office has narrowed significantly over the past few years while the difference in cost has skyrocketed.

If a new movers program is not part of your neighborhood marketing process, you are leaving money on the table and losing out on a great opportunity for account and relationship growth. As the mover rate begins to rebound over time, a strategy for reaching this transitional segment will pay off.

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