Cross Promotions Work for Giant Eagle and Citizens Bank
If you ever want to see what’s possible when a retailer
and a bank really work together to cross promote and build their respective
businesses, look no further than the Giant Eagle and Citizens Bank relationship.
At last week’s
Loyalty Expo conference in Orlando, Trevor Knott of Citizens and Katie Scholl
of Giant Eagle told the story and an impressive tale it is.
The two companies
have been working together for 21 years and have 64 joint locations. Giant
Eagle has 228 supermarkets and 160 convenience stores in Pennsylvania, Ohio,
West Virginia and Maryland, operating under five banners. It is ranked #28
on Forbes’ list of top U.S. private companies. Citizens Bank
operates in much the same trading area, so the fit is natural. But Giant Eagle
and Citizens have gone beyond the traditional tenant-landlord relationship
to operate in-store banks as a perimeter department within the supermarket.
Eagle’s goals for the partnership is to increase shopper frequency
and basket size, while moving secondary shoppers to primary ones. Citizens
looks to acquire new households, deepen existing relationships and decrease
attrition. Giant Eagle counts one million households as customers, while Citizens
has 259,000 in the same trading area.
Roughly 192,000 households are customers
of both companies, so it would appear Citizens has more to gain in terms of
potential new customers. Interestingly, neither company views it that way.
Giant Eagle sees benefits with joint customers making more visits to its stores
than average shoppers while spending more per trip, as well. The same individuals
carry higher loan and deposit balances driving revenue for Citizens.
companies spend a lot of time working on the joint value proposition and seem
to be in alignment on core values and strengths, brand attributes, voice, target
audience and business objectives. The parties have succeeded in establishing
a single-minded strategy and consistent call to action. Giant Eagle and Citizens
work to make sure one and one equal more than two. The companies publish a
partnership guide for store teams on the program, bring store and branch managers
together twice a year and reward them both for successes.
The companies often
conduct joint promotions such as a recent five-week effort offering customers
a $30 Giant Eagle gift card if they opened a new personal checking account.
Nearly 2,900 incremental checking accounts were opened, achieving a 19 percent
lift over a control group and a 28 percent over the status quo. Another promotion
had bank employees sampling food products in Giant Eagle stores during a "Dinner’s
on Us" promotion recently.
Citizens pays Giant Eagle rent for its in-store
branches and the retailer also earns bonuses based on deposits. The two companies
share results in meetings between their chief financial officers.
to this relationship seem to be that the companies are a natural fit, both
geographically and culturally, and top management is 100 percent committed
to going the extra mile to make sure the banking "department" is
treated the same as all other departments, if not better.
Discussion Questions: What is your analysis of the relationship between Giant Eagle and Citizens Bank? Is it typical/atypical of retail/bank relationships? Do you see potential for these types of partnerships between retailers and other service companies?