BUSINESS

Banks back with freebies to get your attention
By Laura Bruce • Bankrate.com

Banks have come full circle since the days of giving customers a free toaster for opening an account. For a long time, most banks stopped giving customers anything but interest. Now, they skimp on the interest but give some pretty useful gifts.

Florida's BankAtlantic hands out gifts when people open a Totally Free Checking account. Current customers get a gift by roping a friend or relative into opening an account. It works. Thousands of folks have been signing on the dotted line to receive a 44-piece Rubbermaid food storage set, a beach chair, a rolling cooler bag or a three-piece stainless steel mug set with 16 ounce insulated bottle.

Although the bank gives some credit to its seven-day branch banking policy, there's no doubt many customer-wannabes are eyeballing the freebies as they fill out the account application.

"The response has been unbelievable," says Jarett Levan, president of branding. "We change the gift every six to eight weeks. We also have a free gift every Friday for customers that come in wearing anything red. We have customers who have millions on deposit that come in just for the Friday gift."

Hibernia National Bank in New Orleans is another of thousands of financial institutions that play year-round Santa Claus, not only to first-timers opening an account but also to current customers.

"I think the gift adds to the appeal of a checking account," says Becky Spinnato, deposits products manager. "The gift helps us to encourage current customers to tell friends about Hibernia. Without a gift program, how would we reward them?"

Some banks choose a different route to say thanks to current customers and to get new ones in the door. First Bethany Bank in Bethany, Okla., population 22,000, fires up the grills and serves burgers, dogs and lemonade to its customers, their families and friends. The annual cookout attracted 700 people this summer, notes Susan Geary, vice president and marketing director.

"We started it 14 years ago. The first year we had about 300 people. The people are served by the employees -- we all work the event. Our customers love it. They start calling us in the spring to ask when it will be held.

"It can be difficult attracting customers, but doing the extra things really makes a difference. People want to be treated like people and not just a number. We try to remember that in all our dealings," Geary says.

Sweep-ing customers in the door
Bigger banks in bigger cities might not want to risk 10,000 people showing up for a cookout. Some are finding that sweepstakes are a better way to get attention. A Bank of America sweepstakes gives people a chance to win one of three Chevy TrailBlazers.

"The purpose is to encourage new and existing customers to take advantage of direct deposit," according to spokeswoman Ashleigh Adams. "Direct deposit frees up their time from having to deposit their checks themselves at a banking center or ATM. The idea of offering the TrailBlazer is to correlate direct deposit with the freedom that comes from having a four-wheel drive."

But all that really matters is the bank gets customers to direct deposit their checks and the customers get a chance at a free SUV.

Hibernia National also goes the sweepstakes route with a pair of season tickets to the "Broadway in New Orleans" performance series. If you don't win, the bank will help you finance season tickets.

Hibernia also is the official bank of the New Orleans Saints. Kids throughout the community can come into a branch and register to be the junior captain for a home game. Winners get four tickets, two pre-game field passes, and they participate in the pre-game coin toss. Probably a fair number of parents are tossing the kids in the car and driving them to the bank so they can register -- and, maybe they open an account while they're there -- although it's not necessary.

"The Saints tickets and the Broadway tickets aren't tied to account openings," says Greg Keightley, senior vice president of marketing.

"I guess we look at our sponsorships as a three-legged tool. There are certain marketing benefits that go with sponsorships. We also hope that business development opportunities with a team and Hibernia might attract some customers, and then there's civic or community responsibilities -- support the home team, retain the home team."

Bigger freebies for big fish
Banks don't forget about their best customers when they're hashing out reward ideas. The freebies get much better as you move up the food chain, but those customers keep lots of money in private banking, brokerage or trust accounts.

Kathy Thompson, executive vice president and manager of the Wealth Management Group at Stockyards Bank & Trust in Louisville, Ky., keeps plenty of her customers happy with annual Christmas shopping trips.

This year she'll load them on a bus headed for Opry Mills in Nashville. While en route, Thompson and other bank officers will serve everything from coffee, juice and Danish, to cocktails and hors d'oeuvres. Once they get to the mall and customers get busy shopping, bank personnel start roaming the mall picking up the clients' packages and taking them back to the bus for them.

"It's a blast. The customers have fun and so do we," says Thompson. "We're looking to gain relationships. If you're with someone all day long you get to know them, let your hair down, have fun, build a stronger relationship. Lunches are nice but you really can't get to know someone. This is a way we truly become friends. There's a lot of laughter and camaraderie."

Thompson says it's predominantly women who go on the shopping trips, although men are welcome. Likewise, the bank doesn't discriminate against women in designing trips geared more toward male interests.

"We take clients dove hunting, fishing and they do paintball wars," Thompson says. "We also take people boating on the lake."

No free lunch
Most of us may never get an invitation from our bank to spend part of the weekend on a boat, but it's easy to qualify for Rubbermaid food storage containers or mug sets. Many gifts simply require opening a free checking account, and that's a smart thing for just about everyone to do. But if the gifts require opening some other type of account, be sure to ask if there are fees involved or if there's a minimum balance that must be maintained in order to avoid fees.

If you're scouring local banks to find the gift that suits you best, keep in mind that you could get socked with a tax bill. You're not likely to have to pay income tax on the value of the gift if it's a beach chair or a cooler.

But if your bank hands out pricier gifts in return for opening an account, or if you win something through a sweepstakes, you may be required to report the prize as income. The lucky folks who win the Bank of America TrailBlazers, for example, will be responsible for taxes, insurance, licensing, registration and title fees.