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Regions bank changes AmSouth's signs and tries to keep the customers

One day next month, tens of thousands of bay area residents will wake up to find that their bank has disappeared.

By Scott Barancik, Times Staff Writer
Published June 24, 2007

One day next month, tens of thousands of bay area residents will wake up to find that their bank has disappeared.

No, Lou Pearlman, the music producer accused of fraud, hasn't escaped from his jail cell in Guam. In fact, the explanation is perfectly legal: AmSouth, acquired last year by fellow Birmingham, Ala., bank Regions, is finally changing the signs outside its Florida and Alabama branches.

Regions had a miniscule presence in the bay area before the merger, with only 12 branches and a market share of 0.7 percent. Better-known AmSouth had 71 branches and a 7.7 percent market share. For Regions, the challenge is to keep former AmSouth customers from bolting for the door. What will it take to prevent such an exodus?

Short answer: pollsters. Time. A good ad agency. And a lime-green metaphor on wheels. Regions' signature bicycle debuts today in newspaper and television ads throughout the state.

"Legally, the companies were merged in November, " Susie Martinez, head of Regions' Florida operations, said in an interview. "But we've done a lot of behind-the-scenes work since then to get ready for what I call a sign change."

Fortunately, a steady diet of acquisitions has made banks like Regions near experts in the art of customer retention. The AmSouth deal, for example, comes just three years after it swallowed Union Planters Bank, a Tennessee company whose legacy lives on in Regions' cotton-plant logo. It is even using the same ad agency it did then, Birmingham-based Luckie & Co.

The Gallup Organization has played a key role in the post-merger marketing effort. Through polls and focus groups, it narrowed in on what Regions' customers wanted most from it: freedom, control, ease and enjoyment. "What we really heard was that life was complicated, and banking shouldn't be, " said Scott Peters, the bank's chief marketing officer.

Thus, the bike. Not a 43-speed Lance Armstrong job, but a one-speed cruiser, the sort you might see a vacationer ride along the beach with a blissful grin.

Focus groups in Tampa and Birmingham liked the concept. "Hop on!" billboards began appearing locally this week, and today's newspapers ads will feature the same. Next month, each Regions branch in Florida will hold a drawing to give away one lime-green cruiser.

Clever marketing alone won't retain customers, Martinez said. Regions tweaked its product line to match the simplicity theme. And in each of its 16 state markets, the bank is introducing former AmSouth customers to the Regions brand a little at a time - ATMs one month, mortgages or credit cards another. "It takes the merger noise out of the process, " she said.

Regions is working closely with former AmSouth employees to make sure they're happy, too. If AmSouth customers see that their former tellers and loan officers have stuck around, they're more likely to do so as well.

Wall Street analysts may be harder to please. The composite rating of 18 analysts who monitor Regions' stock is the 20th worst among Fortune 500 companies, Bloomberg.com says. None of the 18 recommends buying it.

But Regions' commitment to customer satisfaction is long term, Peters said. Under a new contract, Gallup is calling customers every day at each of its 1, 900 branches to ask about their recent visits.

If the figures trend up or down, management will know about it almost immediately.

After the merger

When Regions acquired Birmingham competitor AmSouth in November, it instantly moved up in some market-share rankings.

Market Pre-merger Pre-merger New AmSouth Regions Regions

U.S. 27th 16th 9th

Florida 5th 8th 4th

Tampa Bay 4th 17th 4th

Source: FDIC. Figures based on total deposits as of June 30, 2006

[Last modified June 22, 2007, 22:31:33]