I wanted to explore further my earlier post on why new immigrants provide an enormous opportunity for Banks.  I have been having a good discussion today in the comments with Reynold (thank you!) which made me realise I wasn’t clear enough in laying out my thinking.

Clearly immigrants backgrounds required different approaches, based on different cultures and attitudes, but here I am speaking about the size of the opportunity relative to traditional marketing.  Also I am looking here at new business opportunity, not share of wallet.

Continuing with Canada as an example there are 220,000 – 256,000 (2005) new immigrants annually.

Canada has about 10 million “bankable” households.  Of those, churn runs about 10 – 15%.  This would be people moving, dissatisfied with their bank or accepting an offer from another bank.  That churn accounts for 1 million – 1.5 million new bank sales annually.

The new immigrants of which 60% are economic immigrants, i.e. skilled and or business class, represent a pool of guaranteed new customers for someone.  They are new so they have to open a bank account somewhere.

256 / 1,000 (assuming 10%)  represents a 26% increase in the size of the marketing audience.  But if your marketing tactics are designed to attract people in the 1,000 category, i.e. traditional locals, then by design your marketing is missing 20% of the market.  In fact its worse than that, because the 1,000 comprises existing residents many of whom are recent immigrants (2 million immigrants between 1996 and 2005).  Therefore traditional marketing will be missing 20 – ?? (50% perhaps) of the market.

The more I think about this, the opportunity here is very significant.