Ads for On-Line Banking Paid Off Big for Wachovia

Wachovia Corp. has traced a major increase in enrollment in Internet banking to a comprehensive marketing campaign launched in April.

During that month, the $63 billion-asset bank "got 50% more customers than we had up to that point," said Jeanne Howard, vice president of Internet financial services.

Six percent of Wachovia's checking account households have signed up for its Internet banking program.

Within the next year, it hopes to have 8% to 10% of its checking account customers on-line, Ms. Howard said.

Wachovia's PC Access advertisements appear on television and radio, in newspapers and magazines, and as on-line banners and branch merchandising. PC Access encompasses on-line investing, introduced in September 1997, and on-line banking, launched in January 1998.

Wachovia also distributed through its branches about 100,000 40-page editions of Smart Computing magazine, with articles about on-line banking, purchasing, and etiquette.

"We provided all the editorial and Wachovia advertised its own products," said Chris Blaine, marketing associate at Smart Computing, issued monthly by Sandhills Publishing of Lincoln, Neb.

The special issues, Smart Computing's first such venture with a bank, "got people comfortable with what we were doing," said Ms. Howard. The publishing firm has since produced similar issues with Comerica Bank, La Salle Bank, and First Tennessee Bank, said Mr. Blaine.

Besides the advertising campaign, Wachovia customers are being attracted to on-line banking with a promotional offer of three free months of PC Access. The cost rises to $5.95 a month for on-line banking with bill payment.

"We have tried to hit as many points in the marketing plan as we could," Ms. Howard said.

Half-hearted marketing among most banks is being blamed for slow growth in on-line banking. PSI Global, a Tampa-based research firm, found that the use of electronic banking channels among the 3,100 consumers it surveyed was virtually unchanged from a year ago.

"At this point, a lot of people have heard of Internet and PC banking," said Maria Erickson, senior vice president at PSI. "Banks must now really actively sell consumers on the benefits."

This fall, Wachovia continued pushing PC Access by distributing CD-ROMs containing interactive video clips on how to set up payees and make payments. The video answered frequently asked questions and gave users the opportunity to do demonstrations on-line.

In the early stages of PC Access, Wachovia sent direct mail to customers already using an earlier, proprietary PC banking program. The Internet product was not aggressively promoted to the general public until the April advertising blitz.

"This gave us the support of controlled growth," Ms. Howard said. "We gained a lot of experience before opening the floodgates. We wanted to meet and exceed our customers' expectations."

Wachovia plans to "continue to invest in the channel," said Ms. Howard. "Account information is the key for a lot of our customers. They want to see everything on-line, so we give them an on-line statement and on-line register."

To get customers comfortable with paying bills on-line, payments and their payees are listed on a pending payments list, the register, and the statement. If a customer writes a check, the check number appears.

"The concern for customers is that bills are not paid," said Ms. Howard. "We encourage first-time users to send a payment to themselves to see how it works."

Wachovia supports on-line banking with software from Security First Technologies, in which it holds a 3.1% equity stake, and bill-payment processing through Checkfree Corp.

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