Bella Broccolo
Bella Broccolo is an Associate Research Analyst with Comperemedia, specializing in omni-channel marketing trends.

In our latest installment of the Inflation Exploration series, Comperemedia analyst, Bella Broccolo analyzes the effect of increased interest rates on how brands are marketing savings accounts and mortgage refinancing.

As of March 2022, the Federal Reserve raised the interest rate for the first time since December 2018. The increase was announced as one of multiple interest rate increases expected in 2022. With the anticipation of rising interest rates and the formal announcement of the increase, this created an opportunity for brands to alter their saving and borrowing messaging in campaigns to ease uncertainty and provide guidance during the changes.

Here are 2 ways brands altered their saving and borrowing messaging:

1. Brands altered APY offerings to stay competitive.
As the market changes favored saving opportunities, brands attempted to stand out by promoting an account that helped consumers increase savings. Many brands attempted to entice consumers with an online saving account by promoting ideas of “visible money growth.” Marketing strategy for online savings accounts quickly became a numbers game, with brands attempting to promote the greatest APY.

2. Brands pushed offerings to simplify homeownership.
With the rise of rates aiding in the increase of home inventory, brands shifted messaging to highlight the benefits higher rates could provide. When rates and inventory were extremely low following the pandemic, brands relied on urgent messaging to prompt consumers to buy while rates were at a record low. In 2022, brands shifted messaging to focus on refinancing and HELOCs to encourage consumers to take advantage of increased equity. As inventory increased, many brands also advised consumers to find their dream home.

These brands utilized various omnichannel marketing strategies to execute their evolved messaging for savings accounts.

Email strategy

Brands like Ally used email marketing to convey the benefits of their online savings accounts and share with consumers how they were tracking the Fed’s changes to provide a competitive solution. Ally promoted a cash bonus to consumers with an online savings account. The gift communicated the brand’s understanding of the uncertainties consumers currently faced and sought to provide comfort.

Following the cash bonus offer, Ally again emailed online savings account customers to announce its increased APY. In another attempt to provide support, the brand informed consumers that it closely monitors the market to provide the best rate possible.

Source: Comperemedia Omni [1/1/22-7/31/22] as of [8/4/22]

Capital One promoted its 360 Performance Savings account to both potential new users and current customers utilizing the brand’s other services.

An email from March promoted the brand’s then competitive .40% APY as a benefit exceeding the national average. The email challenged potential new customers to switch to Capital One to have their ‘hard-earned money’ work even harder.

In July, the brand targeted existing customers via email with a .70% APY. Instead of homing in on the APY, the brand positions the offering as an easy decision to save more given the circumstances.

Source: Comperemedia Omni [1/1/22-7/31/22] as of [8/4/22]

Paid social approach

Brands personalized the messaging of paid social posts to suggest to consumers how they can take advantage of rising rates to increase their savings. 

SoFi turned to paid social to update potential customers on the benefits of its online savings account. The brand focused messaging in social posts on its benefits that exceed those of “big banks.”

Source: Comperemedia Omni [1/1/22-7/31/22] as of [8/4/22]

Rocket Mortgage released a commercial acknowledging the unstable housing market and positioned itself as a tool to secure one’s dream home. As rising rates contributed to an increase in home inventory, Rocket Mortgage altered its messaging from “buy a house immediately” to “find your dream home.”

Source: Comperemedia Omni [1/1/22-7/31/22] as of [8/4/22]

Chase utilized direct mail to encourage customers to open a HELOC account to fund home improvement projects.

The brand pushed the anticipation of rising borrowing rates to suggest Home Equity Line of Credit (HELOC’s) to consumers. Chase inserted a sense of urgency by informing consumers the time to tap into one’s equity has arrived and included steps customers should take to begin the refinancing process.

Chase also detailed in mailers the added benefits, beyond home improvement, to cash-out refinance. These benefits included consolidating debt and assisting with big-ticket purchases

Source: Comperemedia Omni [1/1/22-7/31/22] as of [8/4/22]

What we think

As interest rates continue to rise, brands can position products as tools for consumers to adapt to and even benefit from the circumstances. If consumers are prioritizing the ability to save more, brands offering online savings accounts should continue to focus on increasing APY’s to stay competitive with the national rate as well as competitors. For mortgage products, promoting a simple and efficient refinancing service for both current and potential customers will attract consumers overwhelmed with daunting debt. 

For more information on how Mintel Comperemedia can help your brand navigate this ongoing inflationary period, please click here. If you are a Mintel Comperemedia client and would like to read the full report, click here.