The COVID-19 crisis is impacting the way people consume and respond to media. Not only has the impact of various marketing channels changed, but so has the type of messaging that resonates during a time of financial and lifestyle stress that none of us has experienced in the past. This means that financial marketers must continually reassess previous perspectives on conventional and digital marketing use.
People are eager for communication as to how they can better respond to this unprecedented time, but are very selective as to the channels they are consuming. Recommendations around how to manage money or change financial behavior are well received, but there is an increased expectation on the level of personalization that must be delivered.
There is a difference between a household who is deferring payments on loans because they want to shift funds to emergency savings accounts as opposed to households that are deferring loan payments because they are out of a job and need the money to put food on the table. Financial institutions need to know the difference to communicate in the right tone, with the correct solution.
The question is … what has changed in the way we market financial services in a post-COVID world? That was the objective of research completed by the Digital Banking Report and Deluxe entitled, The State of Financial Marketing.
The key findings of this research include:
- While lending and new customer acquisition are still important, COVID-19 increased the need for customer retention, brand value creation and content marketing.
- Improving the use of data and advanced analytics is both the greatest opportunity and the biggest challenge for financial institutions.
- The small business PPP program increased the focus on both lending and small business services since COVID-19. Digital services and savings also increased in importance.
- While more is being done internally in the marketing field, the need to leverage outside partners for data, analytics and marketing technology has also increased.
- Digital channels continue to increase in importance in financial services, with social media, SMS and content marketing having the greatest increases in use.
- The move to digital channels and customer expectations of greater personalization have created a paradox where there is knowledge of the need for improved data and analytics yet 75% of financial institutions consider themselves inept at basic applications of data and AI.
- Marketing technology in financial services continues to lag other industries.
Financial Marketing Pivots … Forever
There has never been a stronger need for the understanding of consumer data and changing trends in consumer behavior. Beyond just ‘knowing your customer’, there will be an unprecedented need to understand how each individual thinks, feels and wants to be communicated to, as well as the behaviors they have changed because of the pandemic.
Part of this understanding will be how much your customer has embraced digital – not just for banking, but for everyday life.
Here are a dozen success strategies that financial marketers should review:
1. Reassess channel allocation. Continue to shift away from channels that are less effective (TV, billboards, event marketing, newspapers) and more to channels that have increased in popularity since the pandemic (video, podcasts, SMS, email, digital).
2. Increase personalization. On every channel, with every interaction, it is more important than ever to personalize messages. The COVID crisis has elevated what consumers expect from every interaction in the marketplace. They understand that engagement with brands can (and should) get more intelligent over time. Avoid ‘mad men’ segmentation that doesn’t reflect every consumer’s contextual situation.
3. Update creative continuously. With changes happening so quickly in the world around us, creative can quickly become stale or irrelevant. Make sure your brand remains current and reflective of the communities you are in and the world around us. The good news is that there is technology that can make these changes easier across channels and messages.
4. Be empathetic. It is imperative to be acutely aware of what consumers and businesses are experiencing right now. Are there kids at home where the parents are involved with home schooling? Are people in the household still working from home, or out of work altogether? Are customers still in a lockdown mode or is it closer to ‘business as usual’? What financial stress still exists in the household? It is OK to ask since every household is experiencing new behaviors. Re-segment your database based on current needs.
5. Put the consumer first. The consumer is more aware than ever whether you are trying to help them or trying to help your organization. Move away from salesy messages to messages that provide viable solutions for today’s environment.
6. Support the local community. The pandemic has made local neighborhoods much more important. Many community social-media pages and forums have been created to connect people with local businesses, support groups and needed services. Managing hyperlocal engagement will require marketers to rework the channels used and messages communicated – delivering at scale.
7. Reset your metrics. Comparing your results to what was achieved last year no longer provides an accurate picture of digital marketing performance given the current environment. Instead, reset your metrics to show what is happening over time since the beginning of March to quickly evaluate what’s working and what’s not.
8. Monitor the cost of media. The cost of paid social fell early in the pandemic as brands pulled advertising dollars and social media usage increased. However, costs continue to change as brands reinvest dollars in conversion-focused channels. Monitor all costs at the channel and placement level to make sure your programs are meeting goals. Adjust media allocation quickly as returns change.
9. Increase transparency. Fintech firms are notorious for being extremely transparent around products and pricing. If you haven’t reviewed your product pages recently, do so. In addition, the availability of customer service channels are also changing as branches open and people go back to the office. Let your customers know what is happening with the locations and channels they use most.
10. Become more socially aware. Socially conscious values have increased in importance exponentially. Every brand should evaluate the commitments being made to the community and make these commitments public. Remember, it is also imperative to back up bold statements with real action.
11. Provide educational options. The pandemic has made the potential to educate digitally more accepted. The need to educate has also increased. From teaching consumers how to bank digitally to helping consumers with money management needs, there are opportunities to build trust with a partnering perspective.
12. Don’t take trust for granted. The importance of trust has never been greater. Not just the trust in financial institutions protecting money in the bank, but trust in being able to provide a safe environment to visit, a healthy environment for employees, a secure place to store data and insights and a partner that will focus on privacy of financial information.
Not all of the above trends and changes will be permanent. While some may be diminished, others may increase in importance. The extent to which these trends stick will need to be systematically monitored.