Forget about toasters.

Citibank is handing out iPod minis to new online banking customers provided they fund their new checking accounts with at least $2500 and pay at least two bills per month for a year.

Analysis
This raises the ante for online account acquisition. It's a pricey premium, even for Citibank, which has long been aggressive at its website, giving away eye-catching premiums such as DVD players or $100 cash.

There is no doubt that giving away the ultra-hot iPod mini will drive new accounts. But it may be over the top for a checking account offer, even by Manhattan standards.

How many 20- and 30-somethings will game the system just to qualify for the iPod? An even bigger concern is existing customers closing their accounts and reopening online in order to pick up an iPod.

But Citi knows what it is doing, and they must figure the new accounts, along with the publicity, makes the risk worthwhile. It will be interesting to see what this book of accounts looks like a year or two from now.

We think most financial institutions, at least those outside the NYC metro area, should keep premiums in the $50 to $75 range. It's enough to generate interest and applications, but not enough to create a buzz at FatWallet with people virtually salivating at the prospect of picking up low-cost iPod at the expense of a huge bank.

Aside: Kudos to Citi for posting a link to the Red Cross for tsunami relief.

If you'd like to learn more about the financial interactive marketing efforts, check out the Interactive Financial Marketing Database from our sister publication, the Online Banking Report.