Target market –


Goal three: increase market share amongst chosen target markets.

Active existing customers and their communities

The history of bankmecu’s participant credit unions help reinforce its strength, resilience and the diverse range of communities that it serves. Its loyal long-term active participating customers and their communities represent a major strength of the Bank. bankmecu will develop business amongst this segment.

Operating locations

As at 30 June 2012, bankmecu had service centres and/or offices in the following locations, all of which form part of bankmecu’s operations and are included as part of this report (unless otherwise stated).

Melbourne Region (VIC)
  • Eastland (Service Centre)
  • Glen Waverley (Service Centre)
  • Kensington (Service Centre)
  • Kew (Service Centre and Head Office)
  • Watergardens (Service Centre)
Gippsland Region (VIC)
  • Moe (Service Centre, National Call Centre and On-line Service)
  • Morwell (Service Centre and National Lending Centre)
  • Traralgon (Service Centre)
Western Victoria Region (VIC)
  • Ballarat (Service Centre)
  • Bendigo (Service Centre and Administration Office)
  • Castlemaine (Service Centre)
  • Echuca (Service Centre)
  • Kerang (Service Centre)
  • Kyneton (Service Centre)
  • Maryborough (Service Centre)
  • Mildura (Service Centre)
  • Sunbury (Service Centre)
ACT Region
  • Canberra (Service Centre)
New South Wales Region
  • North Ryde (Service Centre)
Queensland Region
  • Brisbane – CBD (Service Centre)
  • Gold Coast (Griffith University) (Service Centre)
  • St Lucia (University of Queensland) (Service Centre)
  • Toowoomba (University of Southern Queensland) (Service Centre)
  • Townsville (James Cook University) (Service Centre)
  • West End – Brisbane (Administration Office)
South Australia Region
  • Adelaide (Service Centre)

Customer profile

As at 30 June 2012 there were 129,502 customers. This represents a reduction of 4363 customers over the year due to a continuing active program to close dormant and inactive accounts. The benefits of the program include a truer reflection of average customer value and other customer metrics, and reduced administration costs (e.g. fewer statements and decreased database maintenance). Also reflected is a desire for active customers to share in the Bank’s wealth.

Geographic distribution of bankmecu’s customers 
State 2012 Customers % 2011 Customers %
VIC 100,247 77.4 103,924 77.6
NSW 6,760 5.2 6,801 5.1
QLD 11,094 8.6 11,347 8.5
ACT 4,376 3.4 4,362 3.3
SA 1,379 1.1 1,403 1.0
WA 1,341 1.0 1,368 1.0
TAS 676 0.5 684 0.5
NT 270 0.2 271 0.2
Other 3,359 2.6 3,705 2.8
Total 129,502 100.00 133,865 100.00
Geographic distribution of business
Deposits June 2012
% of deposits
June 2011
% of deposits
June 2010
% of deposits
ACT 8.09 6.17 5.53
NSW 4.59 4.12 4.09
NT 0.08 0.09 0.08
QLD 8.53 8.65 8.68
SA 0.64 0.57 0.51
TAS 0.32 0.30 0.25
VIC 77.20 79.55 80.36
WA 0.55 0.54 0.49
Total customer deposits 100.00 100.00 100.00
Loans June 2012
% of loans
June 2011
% of loans
June 2010
% of loans
































Total customer loans




Customer age demographic

As at 30 June 2012:

  • 44.36 per cent of customer were aged between 25 years and 55 years (2010/11: 45.99 per cent, 2009/10: 47.77 per cent, 2008/09: 50.85 per cent)
  • 39.91 per cent of customers were aged 56 years or older (2010/11: 37.90 per cent, 2009/10: 35.39 per cent, 2008/09: 33.57 per cent), and
  • the average age of bankmecu’s customers was 47 years (2010/11: 46, 2009/10: 45, 2008/09: 45).

Consistent with the general Australian population, bankmecu customers are ageing. The significant demographic changes over the past year include:

  • all age groups increased their level of deposits, however corporate and community sector accounts achieved the highest growth of 23 per cent in 2011/12. The lowest growth was recorded by the 40– 55 age group with just 2 per cent growth.
  • corporate and community sector accounts also accounted for 28 per cent loan growth, while the 18–24 age group decreased by 12 per cent. The 56+ age group grew 7 per cent.

With the prudential regulatory environment and international funding constraints encouraging retail deposits combined with volatile share market returns, investors are opting for the safety, security and certainty of cash investments.

Customer activity

Key performance indicators relating to the strength of customer relationships include product usage, customer retention rate and average customer support value. The following table indicates bankmecu’s continuing strong performance.

Customer activity 
Indicator Target Definition 2011 / 12 2010 / 11 2009 / 10 2008 / 09 2007 / 08 2006 / 07 2005 / 06 2004 / 05
Product usage >3 products % of account holders with three or more products through bankmecu 73.64 72.84 70.91 76.33 76.50 76.70 79.12 75.80
Customer retention rate* No target % of account holders retained over the last 12 months 99.99 99.36 99.34 99.27 99.47 97.80 98.50 95.60
Customer support value >$35,000 Total loans plus total deposits/number of account holders $36,523 $33,000 $28,905 $26,259 $23,287 $18,915 $17,389 $17,435

* Customer retention rate excludes dormant accounts and accounts closed for administration reasons (inactive, bad debt written off).

Civil society and government

bankmecu will develop new business amongst community and relevant government sectors including education, science, environment and community services where these organisations share a purpose and set of values that are consistent with those of the Bank. bankmecu will develop commercial banking business around the needs of these organisations. In addition the Bank aims to develop business amongst people employed by these organisations.

Community sector banking

The value of the community sector banking can be found here.

Socially progressive consumers

Socially progressive people respond to ethical, social and environmental issues and have their own distinctive attitudes, values and behaviour patterns which influence their purchasing decisions. bankmecu will appeal to the needs of this segment.

Consumer attitudes

The global financial crisis has changed attitudes towards banking around the world and shaped behaviour on a scale that has encompassed governments, industry, civil society and consumers. It saw financial devastation caused by irresponsible banking and business practices and people are now seeking out and placing greater importance and value on organisations which conduct business more responsibly.

bankmecu customers were asked in the 2012 Customer Insights survey about their purchase process for banking products and services. Ninety-two percent responded they are likely to factor in the reputation of the bank when selecting a product or service. The figure suggests bankmecu customers are socially progressive and are likely to have been attracted to the Bank because of its responsible reputation.

In regards to social issues, 70 percent of customers denoted that renewable energy and welfare of vulnerable people in the community were most important to them.

Customer responses to the question ‘What issues are important to you?’ 
Question Positive response
Renewable energy 70
The welfare of vulnerable people in the community 70
Quality of education 61
Climate change 58
Housing affordability 53
Loss of biodiversity 45
Sustainable housing design 44
None of the above 4

Consumers seeking to switch

bankmecu will develop new business amongst consumers who are motivated to switch from large investor-owned banks to a customer-owned bank.

Government reform

From 1 July 2012 the Federal Government launched new rules to make it easier for consumers to switch banks.

To take advantage of the new changes and inform customers, bankmecu ran several e-newsletters articles and news items, including information in bankmecu TV.

For information on the new government reform, visit:

Market research

During 2011/12 bankmecu produced a five-year development plan for bankmecu 2012 – 2017. In the development of this plan, bankmecu commissioned two pieces of research:

1   A quantitative study to scope and define prospective target audience segments.

2   A qualitative study to explore expectations of a customer-owned bank and to test creative and engagement ideas.

Prospective audience segments

Three target segments were constructed from the quantitative survey sample:

  • Switchers – This is the primary target segment of the respondents most likely to switch their banking to bankmecu. It comprises respondents who said they would likely or possibly change banks in the next 12 months, and those who had a preference for a non-Big Four bank. It comprises 12 per cent of the total sample and 20 per cent of all people aged 25–54.
  • Concerned about ethics – This is a secondary segment of respondents who are concerned about ethical behaviour of banks, and therefore are considered to be more likely to be attracted to bankmecu’s focus on ethical behaviour and sustainability. It comprises 18 per cent of the total sample and 30 per cent of all people aged 25. Demographically, members of this segment are aged 25–54 and are more likely to be female, living in Melbourne, and have dependent children.
  • Financially concerned – This is a secondary segment of respondents, who are concerned about bank fees, charges and rates – and therefore are more likely to be attracted to bankmecu’s lower fees and better rates. It comprises 15 per cent of the total sample and 24 per cent of all people aged 25–54. Demographically, members of this segment are aged 25–54 and are more likely to be employed full-time and have dependent children.
Customer value consideration

An analysis was also undertaken of bankmecu’s existing customers with less than $5000 of business with bankmecu. This group makes up 67 per cent of customers and less than 2 per cent of total customer value and is a segment bankmecu has historically targeted for increased business. Findings indicate there is little potential for increased business amongst the segment and bankmecu would be best placed by redirecting existing marketing expenditure to target prospective customers with greater potential for profitable development.

Customer-owned banking

The qualitative research showed appeal for the concept of a customer-owned bank. However, awareness of bankmecu was low.

bankmecu aims to carve out a niche market position by appealing to specific segments of the community that are open to the Bank’s value and values proposition. The research undertaken has indicated these potential customers are generally younger (between 25 and 45); living in metropolitan areas with middle incomes; are motivated by ethics and community mindedness, and have or are planning to have a family. Marketing expenditure will be redirected in a more focused way to these market segments over the next five years.

A return on investment (ROI) measurement and reporting of marketing expenditure will also be developed further to quantify the effectiveness of the Bank’s investment; and a value will be determined for the bankmecu brand.