CASE STUDYBBVA COMPASS MARKETING RESOURCE ALLOCATION

Group-6Chetan B R(A011) | Payel Chakraborty(A012) | Karthik P

CASE FACTS

• Part of BBVA Group Spain, a financial service provider with $755 Billion in assets and operations across 30 countries

• BBVA Compass established itself as the 15th largest bank in US through mergers & acquisitions

• Has a predominant business in the sunbelt region, 700 branches & $49 Billion in deposits

• Three primary lines of business : - Retail Banking- Corporate & Commercial Banking- Wealth Management

MARKETING RESOURCE ALLOCATION

• $49 BillionMarketi

ng Budget

• Build brand awareness and trust in the brand• Bring in new customers & increase the total no. of

new accounts• Improve customer satisfaction & retention and cross-

sell to them

Goal

Parameters Offline Marketing Online Marketing

New Checking Accounts 95%80% from Branches, 15% telephone & direct mail

5%

Average Annual Retention Rate 65% 55%

Annual Income Slightly higher Lower

Account Balances Lower Higher

Measuring effectiveness Difficult to estimate accurately Accurate, ROI can be measured effectively

Applications for new checking accounts

95-100% approved 80% approved

Actual fund deposit Mostly people deposit fund 66.67% of approved accounts

MARKETING BUDGET

4%1%7%

21%

53%

14%

Budget

NewspaperMagazineOutdoorOnlineTVRadio

Offline Marketing

• Brand Building• After adopting trade name BBVA Compass,

awareness dropped to 49%• Aim to raise global brand awareness to 53%

• Sponsorships• Multiyear sponsorships with NBA• Title sponsor of Papajohns.com Bowl• Associate sponsor of Texas Bowl, New Mexico Bowl

Online Marketing

Paid Search• Buying Keywords both generic & specific, on

major search engines like Google, Yahoo, Bing• Decision parameters for budgeting - clicks, click

through rates, cost per click, cost per application Display Advertising

• Buying Advertising space on websites where prospective customers are likely to visit

• Generate fewer clicks than paid search but creates brand awareness due to larger no. of impressions

ISSUES

• Declining budget

• Challenge to effectively allocate budget to both measured as well as unmeasured media

• Banks typically spend 25-30% of their budget on measured media (TV, print, internet) and rest on unmeasured media, whereas BBVA Compass spends approx. 75%

• Reviewing both display & paid search budgets to identify the most cost effective channels

RECOMMENDATIONS

• Categorise ad networks based on their performance & reach and remove investment in duplicate

AOL, Traffic Marketplace, Tribal Fusion, Casale, Revenue Science, Interclick, Yahoo contributed to the major chunk of the reach, hence other smaller sites can be eliminated

• Measure effectiveness of sponsorships in sports and review marketing budget for sponsorships

• In order to build brand awareness, emphasis should be on effective marketing communication highlighting on the key benefits and value it offers to its customers