Competitive Rate Analysis | Banks and Credit Unions

August 16, 2019

Our bank and credit union market research company knows customers care about two things when it comes to choosing a financial institution. These two factors have been uncovered time and time again in past bank and credit union surveys.

 

Customers care about: (1) convenience and (2) rates and fees.

 

The first must-have is driven by proximity. Customers want to do business with a bank or credit union which is near their home or work. They want it to be convenient for them if they need to stop by in-person to place a deposit, open a loan, or use an ATM.

 

Secondly, customers want a bank and credit union to offer strong rates which translates to high return on savings products or no/low fees on loan products. Strong rates can be a door opener for a bank or credit union and make the difference between a loyal customer base and one that switches to other financial institutions in the area.

 

These are very consistently the number one and two factors in choice in all of our bank and credit union surveys across the country. No matter the state or the geography, these two themes emerge at the top. Therefore it points to banks and credit unions staying competitive on rates for products like money market accounts, savings, certificates (CDs), etc.

 

Unfortunately, understanding competitive rate offerings at banks and credit unions in your market area can be a monumental task to stay on top of. It involves a lot of time and desk research to review competitor websites, terms, keep the numbers updated, and understand new promotions being run.

 

This is why banks and credit unions work with Drive Research to complete competitive rate analysis market research. Our market research company takes this off of your shoulders and conducts this competitive rate market research for your bank or credit union on a regular and ongoing basis to keep you in the know.

 

Understanding competitive rate offerings for your financial institution in your target market area is no easy task to tackle. Here's how our bank and credit union market research firm can help.

Competitive Rate Analysis Objectives
Drive Research was recently hired by a large credit union in the Upstate New York geography to conduct a market research project. The market intelligence (MI) or competitive intelligence (CI) project involved reviewing competitive bank and credit union rates, promotions, trends, and conditions. 

 

The intention of the competitive rate analysis market research was to focus on money market accounts and certificates of deposit (CDs) initially. However, after the trial, this analysis will be rolled out to a regular monthly program for several other products as well.

 

This bank and credit union competitive rate analysis saves the credit union team a countless amount of hours each week, month, and quarter collecting and reporting on this information.
 

Competitive Rate Analysis Approach
The rate analysis conducted by the credit union uses a secondary market research approach. A pre-determined list of relevant competitors was provided to Drive Research. This included a list of about 20 to 25 banks and credit unions.

 

This was a mix of local, regional, and national institutions to establish benchmarks for comparisons of rates (i.e., we are the highest local money market rate but below the national institutions).

 

Each month, Drive Research delivers the reports to the credit union leading up to the monthly management meeting. As part of the meeting the team reviews the reports and adjust strategies moving forward with rates.

 

The reporting frequency for this credit union is monthly, however, the competitor rate analysis can be customized to any term (i.e., bi-weekly, quarterly, etc.)

 

Competitive Rate Analysis Outcomes
The reports are accessible in real-time online with a summary of key highlights and interpretations, product charts and historical graphs, and well as individualized competitor charts and historical graphs.

 

A competitive dashboard was also created to help the credit union understand relative comparisons at a glance. The monthly report for each product is prepared in an Excel sheet with several informative tabs to help the reader navigate the data.

 

The competitive rate analysis creates a competitive advantage for the credit union. Through the use of historical tracking and trending, the credit union can predict competitive moves and adjustments to rates.

 

The credit union is also able to adjust rates quickly if a competitor makes a large change to product rates to minimize any churn where members leave the credit union to take advantage of more attractive rates. It allows the credit union to be much more flexible and adjust on-the-fly to competitive strategies.
 

Here are four other bank and credit union survey findings that will shock you

 

Contact Our Bank and Credit Union Market Research Company

Competitive rate analysis for banks and credit unions is just one of the many services our market research company offers to financial institutions. Our bank and credit union market research company helps our clients with surveys, focus groups, intercepts, and much more.

 

Questions about a competitive rate analysis project? Need a quote or a proposal? Contact us!
 

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