Winning Deposit Growth in Today’s Digital Marketplaces

“A rising tide lifts all boats” rings true in today’s certificate of deposit (CD) landscape. Financial institutions are feeling the ripple effects of the Federal Reserve Board’s September rate hike, and deposit rates across the industry are increasing in tandem with the Fed’s moves. CD Valet tracks roughly 40,000 CD and high-yield savings account rates from about 5,000 financial institutions across the country, and our recent data reporting shows just how quickly the tide is rising.

Early October’s CD Valet Market Intelligence Tool showed that the number of rates at or above 4.00% annual percentage yield (APY) jumped by 1,332 in one week. Looking at data for that same period, all CD rates increased at a ratio of nearly 14-to-1.

The Digital Marketplace
Given the competitive landscape, banks are looking at all channels to determine their optimal growth strategy. Savers looking for the best offers are flooding digital deposit marketplaces in search of top returns — CD Valet, NerdWallet and Bankrate chief among them. More than ever before, savers are savvy and take advantage of tools that give them a holistic and unbiased view of rates nationwide. Upstream of a saver’s ultimate decision is a bevy of information available in online reviews, forums and comment sections across the internet. So, how can a financial institution differentiate itself when competing in a digital marketplace and influence that decision-making process?

Competing Is Not All About Rate
In our experience, there are deliberate steps — beyond setting a competitive rate — that banks can take to succeed on a digital deposit marketplace. Sure, an attractive CD rate easily wins attention. But to win the deposit, a bank must go further in both competitive tactics and operational support to convert a compelling offer into a satisfied new customer.

Based on our partnerships with banks large and small, here are the most important steps for successful marketing in a digital marketplace.

• Present a competitive rate: Offer a leading APY to stand out and attract rate-conscious savers actively comparing offers. With nearly 40,000 rates, CD Valet’s Market Intelligence Tool provides the data needed to effectively price your offering whether you are competing nationwide or within a select number of states.
• Win with a unique term: Differentiate by offering a term that stands out. Nonstandard maturities — outside of the usual 6- and 12-month cadence — can grab the interest of savers.
• Expand market reach: Expand your potential customer base by offering CDs in more markets or nationwide. Community banks are increasingly using digital deposit marketplaces to cost effectively bring in funds when their local market has a limited deposit base.
• Use inclusive minimums: Lower deposit minimums to reduce barriers. The reasoning for higher minimums is obvious based on return on advertising spend, but setting a $100,000 base deposit sharply limits conversion.
• Enable digital account opening: Enable customers to easily open accounts online, reducing friction and increasing conversion rates. Outside of offering a great CD rate, a smooth and intuitive digital experience is the best way to win deposits on a digital marketplace.
• Continue brand awareness efforts: Ensure that you’re following best practices to build brand awareness and strong search engine optimization tactics. Deposit marketplaces likely have higher SEO rankings, as well as better visibility with the artificial intelligence-powered engines (e.g. Chat GPT, Claude, Gemini). Riding the coattails of their visibility can greatly benefit the visibility of your deposit offerings.
• Provide strong customer service: Responsive customer service builds confidence and helps convert traffic into loyal depositors. At CD Valet, we often hear from savers who pursued a great CD rate but failed to open an account because of the bank’s poor customer service — often tied to a less-than-stellar digital account opening experience. Rate gets a saver’s attention, but it doesn’t close the deal. A strong digital experience and high-quality customer service are what turn a click into a conversion.

Given the higher trust signals digital marketplaces offer consumers and their increasing popularity, AI search engines see them as top sources for their responses to deposit-rate questions. It follows that the brands associated with those digital marketplaces are getting the visibility that can lead to more deposit volumes.