Green Dot is looking to become more accessible to consumers by partnering with distribution outlets including Home Depot (HD), Kroger (KR), Save-a-Lot retail stores, Dollar General (DG) and Dollar Tree (DLTR). Up to this point the company has largely been dependent on Wal-Mart (WMT) for its business.
As of the most recent quarter, 65% of the company's revenue and all of its revenue growth, can be attributed to Walmart sales. By diversifying its distribution points the company is not only increasing brand awareness, but reducing the risks associated with its dependence on Walmart.
Earlier this month Green Dot introduced a mobile banking application designed to help its customers and the underbanked community gain access to portable financial services. The product, GoBank, was released to the general public over the Fourth of July holiday weekend to strong demand and high praise. The application is currently a featured app in the Apple (AAPL) App Store in the Finance section under New and Noteworthy. The company plans to market its new service through a variety of key channels including social media, education, and most importantly in opinion, cell phone carriers.
Let us first take a look at the educational perspective. Green Dot has developed a strategy in which it will market the GoBank service to Barnes & Noble (BKS) College bookstores. Through this partnership the company will gain access to more than 5 million potential customers at 555 university campuses.
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Why is this important? College students may not yet have the financial background needed to responsibly manage their accounts amid the array of other distractions. The GoBank account can easily be downloaded to a mobile device while giving students many of the benefits of having a standard bank account. By using the GoBank application, students can avoid overdraft, ATM, minimum balance and the bulk of other fees. It's too soon to tell how successful the launch will be, although we should have more data after the start of the fall semester.