CBA's Dollarmites gets ditched by another state
The State of Queensland will remove CBA's Dollarmites in its primary schools.
What's the key learning?
- All businesses are looking for unique ways to distribute their product or service (AKA how do they get consumers to use them)
- CBA created an effective distribution channel by creating a schools program where students could learn how to save money
- 40% of Australians are still with the bank they signed up with as a child and therefore the program was lucrative for CBA
WHAT'S THE DOLLARMITES PROGRAM?
The Commonwealth Bank's Dollarmites program is a school banking program that has been in Australian schools for over 50 years.
The program 'teaches' school kids how to better manage their money (and sign up for Commbank's bank accounts). In exchange, Commbank incentivises schools with payments.
ASIC, the corporate watchdog, found that the program had limited value and the children were being exposed to 'sophisticated' marketing tactics.
Queensland is the latest state to drop the Dollarmites program, after Victoria and the ACT.
SO, WHAT IS THE KEY LEARNING HERE?
The purpose of the program and for all businesses was "how do we get our product or service in the hands of our consumer?"
Commbank identified schools as an excellent distribution channel. It helps build relationships with young Aussies... and then maintains those relationships pretty much til ya die- with bank accounts, home loans and car loans.
Since nearly 40% of Aussies are still with the same bank that they signed up with as a child - this was a very lucrative program.