|IDEA EXCHANGE: Arvest builds debit base with affinity|
Local high schools and causes drive pride in plastic
Kincy, who happens to be vice-president and marketing director at Arvest, is one of nearly 30,000 Arvest customers who supports a local cause, school, or charity through the $13.6 billion-assets bank's affinity debit card program. The bank, which operates through regional management in a four-state network of 250 branches, began introducing the program to schools about 18 months ago and has since widened eligibility to more types of organizations and expanded its reach through more of its territories.
When a school or cause becomes part of the affinity program, new debit card customers can ask for the special card at no extra charge, Kincy explains. Those who already have an Arvest debit card must pay a $5 card replacement fee, which covers the bank's costs of reissuing. Arrangements with the local organizations vary from group to group, with some simply gaining some exposure through the effort and others obtaining some type of financial compensation from the bank. This takes the form of a licensing fee or a donation per card issued. The bank has 42 arrangements thus far, and Kincy projects that total to come to around 60 by yearend.
"Really, anywhere you have a group of people with a common interest, you have potential," Kincy says.
In some markets the bank has enjoyed an exclusive with this idea, while in others competitors have also latched onto the concept for debit programs. Kincy says the local play works well for organizations with a "community banking" approach to their markets.
"We offer our debit cards to some really small schools that would not even be on the radar of the very large banks," says Kincy. Groups sometimes engaged actively in marketing the cards, in ways a very large organization wouldn't likely deem cost-effective. But for those whose compensation hinges on cards issued, there's a natural incentive there.
Kincy's department becomes involved with every program, both in designing the card's look and making sure it meets the requirements of Visa's rules.
One issue that comes up, now and then, with school teams is their unauthorized use of the logos of major league teams. For a local team using the logo in a local market, this hasn't generally turned into a legal issue. However, putting a pro team's logo on a card issued by the bank under Visa raises the visibility and isn't permitted. Where a logo would infringe on pro team's rights, the marketing department helps the group find an alternative look that still works with its name.
Establishing programs also involves going through approvals and agreements with school boards, in some cases, and with school administrators, in others.
"It's just not something they'll enter into lightly," Kincy explains.
The bank has been offering the program in about a third of its markets. In some cases the
"This isn't so much a moneymaker for us," says Kincy. "It's really about exposure."
And about retention, of course. Who's going to dump and cut up the local team or cause?
[This article was posted on September 21, 2012, on the website of ABA Banking Journal, www.ababj.com, and is copyright 2012 by the American Bankers Association.]
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