American State Bank of Iowa’s mobile coupon app edges out the competition

American State Bank of Iowa’s mobile coupon app is a win for customers, local businesses and the bank itself.

By Andrea Lahouze

In the northwest corner of Iowa, American State Bank of Iowa has found a creative way to maintain its competitive edge with customers. In November 2016, the $850 million-asset bank in Sioux Center released its own branded mobile coupon app, called American Edge, which offers users discounts at businesses in town and across the country. While many other businesses might choose to offer a coupon app at a cost, the community bank opted to make it available to its 9,000-plus rewards checking accounts for free.

“We wanted to do something to jump ahead again,” explains T.J. Speer, American State Bank of Iowa’s vice president of corporate affairs. “Instead of fighting over interest rates, we decided that we can provide services, products and access to people that would be harder to compete with. We also were looking at our millennial markets. We wanted to have another place on their cellphone where they access and use us for information. From the relationship-building perspective, we want to be more than an industry. We want to be our customers’ partner for information.”

To make it happen, the community bank partnered with a company called StrategyCorps to brand and customize an existing app, including offers from local businesses that wanted to participate. The result is a robust and rotating collection of coupons for products and services in town and across the country, from restaurants and coffee shops to gas stations, hotels, hair salons and more.
“We’re part of the StrategyCorps network, so our customers who travel can still find these deals. It’s like an ATM but for coupons,” Speer says.

How it works
The app tracks savings from each coupon and adds them together so users can see their total savings. One-third of the rewards customers have the app downloaded and about 66 percent of those customers use it on a regular basis. Marketing director Erin Reichle says many have saved upwards of $90.

In addition to coupons, the app offers users several free insurance services, including identity theft aid. Should a customer fall victim to personal identity theft, the app would provide $2,500 and a personal fraud specialist to help her recover losses and restore her identity security. Customers who pay their cellphone bill using their checking account get free cellphone insurance, which replaces their cellphone free of charge if it breaks or is stolen. All users also have access to free roadside assistance up to $80 should they have car trouble.
Local businesses, too, are reaping benefits. Because the bank does not charge merchants to participate, there is no cost to them apart from the deal they present, making it an effective and free form of advertisement. “Our business customers really like it because we’re giving them access to our highest-balance customers,” Speer says. “It’s important for small-town businesses to do business with others in their small towns. This is another way for us to advocate for that for them, which also encourages them to continue to do business with their bank. ”

And for American State Bank of Iowa, serving as the connection point between local residents and local businesses is another way it walks the walk when it comes to supporting an economically vibrant community.

“It adds more value than just bumping our interest rate five or 10 basis points,” Speer says. “The cost is less than if we would bump it 10 basis points, to be honest with you, but the value to the customer is significantly higher.”

Next on American State Bank of Iowa’s stay-one-jump-ahead agenda: instant issuance, a service Speer says the bank will roll out in January. “We want people to be able to walk out of the bank with their own debit card that’s a full debit card,” he says. “We have Apple Pay, Samsung Pay, Android Pay, so they’ll be able to instantly put it on their phone. We want the customer to have access to their money the minute they leave.”

Andrea Lahouze
is deputy editor of Independent Banker.