Retail Profit Management - RPM Consulting

                                       MarketBank Market Potential

About Retail Profit Management - RPM Consulting

Retail Profit Management is a consulting company founded by corporate planners and MIS officers. Our mission is to help companies and organizations to understand and approach their markets and communities more effectively, and more profitably. RPM has developed numerous solutions for its clients in the areas of applied profitability analysis, customer relationship management and information systems, and GIS (mapping) systems for strategic marketing.

About MarketBankÔ  

MarketBankÔ  databases contain an estimate of financial services utilization by product for small geographic areas such as zip codes, census tracts, and block groups. These are then aggregated to create estimates for branch trade areas, cities, counties and other large area geographies. Potential is estimated for non-business consumers based on the demographic and socioeconomic characteristics of households residing in an area, and upon the Federal Reserve Bank’s Survey of Consumer Finances -- a comprehensive longitudinal survey of households conducted tri-annually. Using the weighted raw survey data, relationships between households’ socioeconomic characteristics and financial services utilization are identified.

The market potential methodology is based on a segmentation of respondent households on the basis of demographics. Each segment is then profiled in terms of its product-by-product penetration, account, and balances for each product. The segment profiles are then used as the basis for market potential estimates by geographical area. To estimate the potential in a region, demographic variables for the region are used to estimate the number of households residing in each segment. The product utilization profiles are then applied to the households to arrive at market-wide estimates. These estimates are then verified for accuracy by comparing them, on a market-by-market basis, to the actual product balances in the market as defined by the most recently available FDIC Call Reports.

Estimates of future potential are derived by estimating the number of households in each segment based on forecasted demographic variables. As with current year estimates, product utilization profiles are then applied to each segment to arrive at the market potential per segment by product. Balances are stated in current year terms so that comparisons and calculations of growth rates in balances are always in current dollars.