When it comes to bank marketing, nothing is more important than directing your message at the right audience. In most cases, it is necessary to know a potential customer on a level deeper than their account number in order to earn their business and trust. Banks today are facing more competition than ever before, so treating someone as an individual rather than a one-dimensional account can be the deciding factor between gaining a life-long brand champion and losing one. Though it may seem fairly straightforward to relate to your existing customers, the problem lies in personalizing a message for potential clients that you know nothing about. This is so difficult, in fact, that while 94% of marketing professionals say personalization is important, over 80% of banks fail to personalize their marketing.
Because you have already earned the business of your existing customers, marketing to possible consumers is of much greater significance. Obviously, banks possess more information about their existing customers than they do about prospects, but to what extent? Consider that 98% of bank customers don’t log in online or walk into a branch unless they have a purpose and that about 60% to 90% of bank customers already know what they want to do before logging in or coming into a branch and you start to understand how important it is for banks to reach out in order to engage both their retail and business customers before they log in or come in.
Don’t Make This Mistake
Since it is so difficult to find information on potential clients, most banks attempt to work backwards by relating to prospective customers based on information about their existing ones. In fact, a major bank marketing firm is based on this whole premise. You show them your customers, they slice and dice the data and tell you to go after more of them. It is an ironic task that while results in more customers, it is not the best use of marketing dollars and you should market not to the profile that your bank already has but to the profile your bank wants. Targeting known consumers may dismiss a large anonymous (and profitable) population who might be attracted to your bank via more effective marketing methods, so assuming the main objective of personalization is attracting new customers, basing a marketing strategy off of existing clients will most likely prove relatively ineffective.
The Solution – Make It Personal
Clearly, creating a personalized marketing campaign is no walk in the park, but if it is such a difficult task, then why should banks spend so much time and effort on it? A recent marketing study by CMO found that personalized emails alone can increase transaction rates by six times, and marketers who personalized their websites saw an average increase of 19% in overall sales. Additionally, nearly 75% of customers report experiencing frustration when advertising content is not individualized.
Fortunately, these days, data abounds. Give us an email address and for about $0.40 we can often tell you the approximate age of the person, the education, job, hobbies, social media profile, approximate age and likely demographic. As you come onto a website we know how up to date your software is, the device you are on, your proxy address and the information contained in your cookies. Below are graphs of the top data sources used to develop a personalization marketing campaign and the average information known about a person ranging from anonymous to known by the company, respectively:
Is It Creepy?
Of course, any data collection effort first starts with having sound privacy and data protection infrastructure, policies and procedures. Most of the above information is public and is freely flowing around the internet anyway. Banks, on their marketing game, are just taking advantage of this information. One great reason to integrate and leverage with social media is to harvest the associated information that individuals and businesses freely put on. Banks that find data collection too creepy, risk not tailoring their message and will find themselves at a great disadvantage. Consider that for decades banks had no problem purchasing this information from companies like Dun & Bradstreet or Hoovers so gathering this information from browser sessions or social media isn’t that much different.
Although it is important to collect data on potential customers, it is equally imperative to know how to interpret that information and apply it in a way that will increase your customer base. In future postings, we will be covering this more in-depth and highlight tidbits on how someone’s love for ESPN’s SportsCenter makes them almost twice as likely to want an SBA loan.
Today, the number of people and businesses with social media accounts is higher than ever before and continuing to rise. With more prospects sharing their lives on the internet, personal information is becoming increasingly accessible. As social media continues to grow, so too will the opportunities for banks to creatively tailor their marketing strategy to the right individuals. This may be an affinity promotion for a hobby, targeting a certain type of business, lifestyle marketing or promotions targeting a certain demographic.
Strong competition in the banking industry today is forcing banks to change the way they approach marketing. Customers want assurance that their bank cares about them as an individual and not just a dollar figure. A personalized marketing strategy will not only prove that each client is important, it will capture attention and show potential customers that your bank offers the services that they need.
Submitted by Chris Nichols on July 09, 2015