Gone are the days when banks were really local and would offer you enticements like a toaster or plant to open an account and you would go to the bank when you needed cash. Who uses cash anymore? Who goes inside a bank? Who cares if your bank has a branch in town? Maybe you could still use a toaster. But nowadays banks are more likely to offer you money; the best offers for checking accounts range from $100 to $1,500. And even though more than three-quarters of the population are digital banking users, banks still have local branches, and a lot of them, although the number of bank branches has been steadily dropping since 2011, going from over 100,000 branches in the US to now around 89,000. These brick-and-mortar banks are now competing with neobanks and digital banks. As the marketplace continues to become more competitive and our economic ecosystem continues to erode consumer confidence in future expectations, traditional banks, both national and regional, need to develop and implement a marketing strategy that addresses consumers’ needs and concerns, inspires confidence and trust, and differentiates the brand.
Trust has always been an important factor in a consumer product/service relationship. For banking/financial relationships trust is paramount. First and foremost, customers need to be confident their data is protected and that their financial institution can help them achieve their financial goals, particularly by offering the best products/services to meet their individual needs. In fact, according to a J.D. Power study overall customer satisfaction increased 229 points (on a 1,000-point scale) when customers were offered advice/guidance that completely met their needs.
How to do this? While cash can be a motivator, it is not enough. A multipronged marketing strategy can help banks:
- Start with a customer-first mindset. Recognize that while the products and services offered may be the same across institutions, what differentiates one over the other for a customer or potential customer is knowing they come first. One could argue toasters and plants helped enhance one’s home and the local bank was communicating that it wanted to help customers do that.
- Market across all channels, tailoring messages to the medium and the likely consumer of that medium, emphasizing personal focus/life stage orientation of products/services offered, and accessibility of financial advice.
- Recognize that customers are different with varying needs and concerns; so marketing must be personal. Traditional banks have an advantage in being able to offer a wide range of products and services. Customize offers and benefit messages using data available (internally, through third parties, through research and surveys) to determine which products/services may be most important/useful for the customer and communicate those findings directly, through email, direct mail, SMS.
- Make sure operational features are consistent with the messaging to eliminate overpromising.
- Develop video content that can build trust and provide a human face to answer questions or address basics of approaching financial questions. The video content can be shared through email, QR codes in direct mail, on the website, and/or in social media outlets.
- Consider expanding outreach to small businesses and those who are unbanked or underbanked. These targets are very different but each is likely to respond to the outreach and to appreciate the local branch. As an example, M&T Bank has redesigned multiple branches to be multicultural centers, to serve communities with high concentrations of ethnic and racial diversity by offering banking and other financial services in customers’ preferred languages and employ bankers from the community who understand the cultural nuances of the individuals and neighborhoods they serve.
- Social media messaging should reflect the specific medium. A more serious/news-type article may be more appropriate for Twitter or Reddit while using an influencer may work better on Snapchat or TikTok.
- Search engine marketing, both paid and organic, tied to specific offerings and/or life stages, can reinforce the messaging from other channels.
- Make sure the website experience is extremely user friendly where a visitor can easily find the information they want.
- While individual services/products can be promoted, place them in the context of an integrated whole of an institution that will help the consumer tackle and achieve their financial goals.