Why Coin Counters and Other 'Convenience' Strategies Worked

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NEW YORK ( -- John J. Cunningham has had to deal with fast growth, industry consolidation and even terrorism during his career, but in the end, counting
Photo: Hoag Levins
Commerce Bank's 'Penny Arcade' machines allow anyone to change coins into cash for free.
the coins in customers' penny jars has paid off.

In his 16 years as chief marketing officer at Commerce Bancorp, the 43-year-old has seen the Cherry Hill, N.J., bank grow from a speck on the map to a player with national aspirations.

For Mr. Cunningham, reaching out to customers is akin to a personal mission. “I love this place, and the opportunity to build a brand as strong as Commerce Bank is really exciting,” Mr. Cunningham said.

Coin machines
The bank, which bills itself as “America’s Most Convenient Bank,” models itself on retail stores, not banks. Branches open seven days a week, until 8 p.m. most days, and offer a variety of services, which include the popular lobby coin counting machines. Dubbed "The Penny Arcade," the colorful devices allow any consumer to walk in, dump a bag of coins, have them sorted and counted in seconds, and receive a receipt for the total amount. Any teller can then redeem the receipt for cash or process it as a deposit into an account.

The free lobby coin-counters were an idea that evolved at a time other banks balked at consumer requests to change large collections of unsorted coins into bills. Grocery stores that did have public coin machines charged as much as 9% for their use.

Commerce installed free Penny Arcade coin counters in its branches in the summer of 1999 to evaluate if there was any consumer interest in them. During the six-month test period, more than 180,000 people used the machines to process $14.3 million in coins.

Retail atmosphere
The coin counters with their animated touch-screen instructions give even non-Commerce customers a good reason to come into a nearby branch. The units, which are surrounded by Commerce promotional materials, epitomize the comfortable, retail atmosphere the company has carefully sought to establish.

Such convenience positioning is finding converts and has helped set Commerce Bank apart, experts believe. “They really have struck a responsive chord,” said Alan Siegel, chairman-CEO of branding agency Siegel & Gale, New York. The message echoes, especially among customers who feel neglected as their local banks fall to consolidation, he said.

Mr. Cunningham started out as a Philadelphia banker, first at First Pennsylvania Bank, then as a regional marketing manager at PSFS, another Philadelphia bank, when he was hired in 1988 by Vernon W. Hill, Commerce Bank’s founder and chairman-president.

Leaving a large, established bank to a join a bank with 11 branches in New Jersey was a risk, he now admits. But “it was an opportunity you just could not pass up,” he said.

“His job and he evolved as this company evolved,” Mr. Hill said. The marketing department, which originally consisted of Mr. Cunningham alone, now numbers over 60 people. In the last year, Mr. Cunningham recruited Chas Herman, former vice president for marketing at Starbucks, as senior vice president for retail marketing.

TV advertising
Commerce has expanded its efforts into TV and sponsorships and maintains an extensive corporate-giving program to benefit the communities in which it does business. Three years ago, it began to advertise on TV, sponsoring a brief visual with the time and temperature during the local Philadelphia news broadcasts. The idea came from the time and temperature signs banks used to display, Mr. Cunningham said. The concept was later put in use when the bank entered the New York market.

Commerce plans to continue its expansion throughout New York and into Connecticut this year and south to Virginia in 2005. Eventually the bank’s goal is to stretch from Boston to the Washington area, Mr. Cunningham said.

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