A Peek Inside the Mind of Check Users

A Peek Inside the Mind of Check Users Check Program DELUXE Findings from the Javelin Strategy & Research 'Check Pricing Strategy' Prepared for Deluxe Corporation Checks remain a major component of the payments industry and unlike other payment types, check usage is an indicator of an active, primary account. Check buyers are looking for savings and convenience when reordering checks. Those that shopped for a better retail price reported an average savings of only $1 per box. Key Takaway Key Takaway Over 60% of check buyers are Generation X or Y which are prime targets for your loan products. Checks can help you target and anchor these important and profitable account holders. Incremental price increases have minimal impact on units sold. This is likely the result of a 13-month order cycle coupled their inability to remember the last price they paid for their check order. OVERALL CHECK MARKET SECURITY FEATURES There is a strong positive effect on uptake and revenue when high security Over 580 33% of Fraud protection checks are non-cash dollars services like Deluxe Provent paid every second in PAID are transmitted via check in the had a positive effect at all base the U.S. U.S. features are added and priced at $2.50 or less. prices tested 2013 Federal Reserve 2013 Federal Reserve Payments Study Payments Study USAGE TRENDS OF CHECK BUYERS BUYING HABITS TREND 01 НАВT 01 Reorder checks without Checks 5.5 written monthly %- comparing prices TREND 02 НАВT 02 43 43% Carry checks 42% are willing to pay for duplicate checks at a $2.50 pricepoint. with them THE BUYING TREND 03 HABIT 03 CHECK HABITS OF 48 % Think some 55% are "not sure at all" or payments easier by check "somewhat sure" of what MARKET CHECK BUYERS they paid on their last reorder TREND 04 63 Check buyers who are in %/ generation X or Y Generations X and Y, your primary targets for loan products, were the most likely to value and subsequently purchase check security and fraud protection features. Packaging products and services with your check program creates opportunities for fee income for your financial institution while providing value to your account holder. USAGE PER MONTH + PREFERENCE GENERATIONY GENERATION X BABY BOOMERS 1/ INCLUDE 4/ 5/% 6/ CНECK HOW TO PER PER PER HIGH SECURITY MONTH MONTH MONTH Prefer Duplicate Prefer Duplicate Prefer Single BUYING BY INCREASE FEATURES Checks Checks Checks GENERATION REVENUE FIND VALUE ADDING Check buyers value security features and 25% are willing to PERSONAL FINANCE SECURITY SERVICES TO THEIR CHECK ORDER pay additional fees to add them to their checks GENERATIONY GENERATION X BABY BOOMERS 58% 48% 34% 2/ OFFER FRAUD PROTECTION FIND KEYSTROKE PROTECTION VALUABLE WHEN ADDED TO THEIR CHECK ORDER 33% of check buyers were willing to pay to add security features like keystroke and fraud protection 45% 34% GENERATIONY GENERATION X BABY BOOMERS 26% 58% 50% 40% BABY BOOMERS Price shop when running low 3/ OFFER REWARDS TO Key Takaway Key Takaway 51% Generations X and Y are 43% Check buyers that order through their financial institution have higher average order values and typically repeat their previous order. They are also more willing to bundle products to their order. 33% your most profitable customers due to their highly profitable loan opportunities, ability to add security features to generate fee income, and their habitual order patterns. ENCOURAGE CHECK USAGE Y х BABY BOOMERS Check buyers value security features and 25% are willing to Reorder whatever they had in the past regardless of price pay additional fees to add them to their checks %24