ADVANCED CONSULTING SOLUTIONS

1st Mariner Bank Proposal

Prepared for: Professor Lebron
Prepared by: Advanced Consulting Solutions
November 19, 2015

ADVANCED CONSULTING SOLUTIONS

EXECUTIVE SUMMARY
Problem
With major advances in technology, retail businesses and specifically retail banks have turned to eCommerce and
have chosen to conduct business through online and mobile banking interactions. Due to the fact that many banks
are shifting to digital banking, less and less customers are walking into their local bank branches. Less traffic in
banks translates to fewer opportunities for 1st Mariner Bank to provide financial advice and to up sell/cross sell
customers.

Goals
Increase the number of customers walking into the bank branches while continuing to focus on customer-service
and community-style relationship banking.

Solution
Provide free financial literacy seminars to Millennials and Generation Z. We will educate the younger generation and
provide great incentives to get them in our door and meeting with a financial advisor at least once a month. No
matter what their financial situation, 1st Mariner will strive to help their community and educate their customers to
make the right financial decisions. By attending the initial seminars at 1st Mariner Bank and maintaining a
relationship with a financial advisor, customers will be qualified as Premier Customers. The Mariner Premier
Program offers monthly discounts at participating businesses in the local area.

ADVANCED CONSULTING SOLUTIONS

THE COCKEYSVILLE BRANCH

Demographics of Cockeysville
Age:
15 years old - 24 years olds make up 14.6% of the population
24 years old - 34 years olds make up 17.1% of the population

Wealth and Economic Level:

Average Household Income is approximately $82,000 per year
Per Capita Income is approximately $37,500 per year
Education:

Educa&on)Enrollment)

Enrollment19% of residents are enrolled in Grades 9-12

33% of residents are enrolled in College.
7% of residents are enrolled in Graduate or
Professional School

Attainment23% of residents attaint a high school diploma

22% of residents attended some college, but attain
no degree
31% of residents attain a Bachelors Degree
24% of residents attain a Graduate or Professional
Degree

Educa&on)A+ainment)

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Opportunities within Cockeysville

Our target demographic is the population age 18-24, which at 38,481 represents 11.37% of the Cockeysville
population. If the Cockeysville branch was able to capture a mere 10% of that population group, the number of
client accounts would increase by 3848, or 159%, from the current amount of 2,419.
The young population has high demands for home, auto, and school loans. With such a large percentage of the
population currently enrolled in college and/or professional or graduate school, the need for educational loans
offers a great opportunity for 1st Mariner Bank. In addition to the large number of residents enrolled in college,
geographically the Cockeysville branch is at another large advantage that being the number of colleges and
universities local to Baltimore County.
A second major opportunity in Cockeysville is the large number of small and local businesses in the area. With so
many small businesses, the need for financial loans will always be present. Although many of these businesses are
already established, they may seek financial loans in order to expand their businesses, open new locations, or
require extra funds to enter the technological era. In addition to helping these local and small businesses
financially, 1st Mariner would also benefit these businesses greatly through partnerships and lead these businesses
to gain customer loyalty and brand recognition.

Business Mix

Business Type

Number of
Businesses

Average
Revenues

Agriculture

179 $.182 Billion

Mining and Construction

580 $3.49 Billion

Comm. and Industrial

10561 $4.64 Billion

Public Administration

744 15.07 Billion

Total

12,064 $5.16 Billion

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Market Position & Market Share Opportunity

The current market share the Cockeysville Branch contains is 0.35%. Due to the fact that this market share is less
than 2.50%, it is categorized as weak. As of June 2015, within the $12,511,528,000 of deposits within the DMA
(8 mile radius), the Cockeysville branch holds a mere $44,318,000. In addition, the Cockeysville branch has seen a
-0.14% slide in market share over the last two years.
Although the current market share is in a weak position, the Cockeysville branch has a great potential to grow and
optimize market share opportunity. The potential of consumer growth is as followed:

Projected Loan Growth = 1.20%

Projected Deposit Growth = 2.23%

Cross Sell Ratio & Current Wallet Share

Branch

Households within
an 8 mile radius

Account Relations
(Bank Accounts
Per HH)

136,830

9.14

Cockeysville
Cockeysville Customers = 2,419

Total Accounts/Services to Customers = 10,445

Total Ratio = 4.32

Institutional
Relationships Per
HH
2.66

Cross Sale Target

(Account
Relations/2)
4.57

ADVANCED CONSULTING SOLUTIONS

THE SOLUTION
1st Mariner Bank will offer incentivized financial classes focused towards Millennials and Generation Z
Every month, a new registered group of 40 people between the ages of 18-24 would attend two free lectures
structured around financial literacy. The lectures would cover topics such as the importance of planning for
retirement early, living a budgeted life, and even basic processes like how to write a check. The purpose of these
lectures is to make young people see the importance of planning and want to establish a relationship with a
professional who can help keep them on track (a financial advisor with First Mariner).

Why Financial Classes?

The amount of financial illiterate citizens in the United States is large and growing, which translates to many young
people starting their lives in debt or making poor financial choices that could likely place them in debt. Due to
previous events involving banks, the trust between clients and the bank has been tarnished. By offering classes
and seminars, 1st Mariner will have the opportunity to connect with the community and offer sound advice which
can ultimately instill trust back into the clients.

Incentivizing: Why/How?
The truth is that Millennials/Generation Z need to have an incentive for them to make an appearance to the bank,
otherwise they could just follow the industry shift and do their banking needs online.
How we can bridge both the mission of being a locally involved bank with the desire to increase customer flow into
the bank itself would be to offer a Mariner Premier Rewards Program to both existing and incoming clients within
our target audience (between the ages of 18-24).
Mariner Premier Rewards would offer discounts to 10 various local businesses on certain days of the month; such
as bowling, movies, and restaurants. Being a member of Mariner Premier Rewards would be contingent on
meeting with an established First Mariner financial advisor at least once a month.

How Do Free Classes and Incentives Boost Profitability?

The yield on Commercial and Industrial loans is 3.07% YTD 2015, while the cost of funds is .48%. With a positive
spread of 2.59%, the bank could offer a 20% reduction in interest payments to the 10 companies participating in
the rewards program.
With free classes and the incentives that follow, more people will be walking into the bank. The classes and
incentives have the potential to create a large buzz and spread quickly through word of mouth. These great
incentives will attract current customers to the classes, as well as new customers. The incentives mainly involve

ADVANCED CONSULTING SOLUTIONS

financial bonuses and assistance. More clients will be motivated to take out loans through 1st Mariner Bank when
they are given the opportunity to receive lower interest rates and approval even with poor credit.

Resources Needed
Implementing the financial classes along with the incentives will require a vast amount of resources, all crucial to
the success of the operation. The following are resources 1st Mariner Bank needs to attain:
1. Staff with good speaking, demonstrative, and communication skills
2. Professors and other professional guest speakers from local colleges and universities
3. Pamphlets/flyer and other reading material for customers to take away with them when coming in for class
4. Signage to advertise new classes and new incentives
5. A webpage on the 1st Mariner Bank website dedicated specially for the financial classes that addresses:
Show the available courses
Courses schedules
Courses descriptions, instructors names, courses rating and reviews
Surveys for potential classes
FAQs
6. Administrative staff for class registration and assisting students
7. Collaboration with the marketing department to indirectly promote the bank products to students
8. Changing the physical layout of the conference room into a classroom setting. It will be necessary to attain
chairs, desks, whiteboard, computer, and a projector

Skills Needed
Along with resources, a large variety of skills will be needed in order to execute this plan effectively. The skills
needed include:
1. High level of financial education
2. Speaking and demonstrative skills
3. Communication skills

4. Interpersonal skills
5. Research skills
6. Marketing skills

Revenue and Growth Potential

The potential in revenue and growth with this program is extremely high. A Checking/Savings account would be
opened after the first meeting, as a budgeting plan would be developed with a financial advisor. It is also likely that
these clients will need loans and wealth management accounts for the future. The conservative lifetime revenue
growth potential is broken down below:
Account Type

Capital Contributed

Revenue per Client

Annual Revenue

Checking

$5,000 $5,000*1.95%*8 years =

$780*40p*12m =
$780
$374,400

Savings

$5,000 $5,000*1.95%*10 years = $875*40p*12m=

$875
$420,000

Loans
Wealth Management
Total Annual Revenue
Growth

$200,000 $200,000*2% =
$4,000

$4,000*40p*12m=
$1,920,000

$6,000

$6,000*40p*12m=
$2,880,000

$200,000 $200,000*3% =

$5,594,400

ADVANCED CONSULTING SOLUTIONS

THE PHYSICAL DESIGN

Overall Space
The overall general space and style of the Cockeysville branch after remodeling will be open, dynamic, and
modern. The branch will also contain state of the art technology to offer an up-to-date feel for the new, young
customers. Having a style that is overall modern, minimal, and sleek will attract customers and instill confidence in
them that 1st Mariner Bank will be responsible with their money and lead them in the right direction. Convenience
and simplicity are key.

The Bank Lobby

The bank lobby will be a lounge style to ensure customers are comfortable and welcome when entering the bank.
It is crucial for the lobby to be welcoming and comfortable due to the fact that there will be larger amounts of
traffic in the bank, specifically during class sessions and seminars. While clients wait for a class to begin, or want
to stick around after a class and talk with a financial advisor, 1st Mariner needs to ensure the lobby is a great place
to do it.
While offering comfort, the lobby will also be the main area where technology is incorporated. The iPad station will
stay in place and more will be installed. The installation of Apple desktop computers at a computer bar will allow
clients to access their accounts and check financial information when needed at their convenience. In addition to
the computer bar there will be printer access for clients who would like to print statements out before their
financial class or before meeting with a financial planner.

The Conference Room

With the implementation of seminars and financial classes, the conference room will be greatly utilized and
extremely important. The conference room will be located at the front of the branch, directly by the entrance. The
conference room will also feature 3 glass walls. Having the glass walls will draw attention to the classes and
potentially attract new clients. The glass walls will fit appropriately with the modern, open design.