For financial marketers 2021 will be a year of moving past commonplace generalities and focusing on specific ways their institutions can help consumers and businesses deal with the specific challenges that COVID-19 and its accompanying recession have wrought.
Even as they build on the experiences of 2020, they will have to figure out new ways of communicating longstanding aspects of banking, such as the human element, as in-person banking continues to be impacted.
Changes on changes will continue. At Mintel, and its affiliate Comperemedia, the consensus is that “full-on normal” is not something that’s coming back.
Much as people keep hoping for the “new normal,” the truth is that “we certainly have some normalcy today,” says Lily Harder, Senior Director, Marketing Strategy, in an interview with The Financial Brand. “But what feels normal today is not going to feel normal in six months and six months beyond that. At Mintel we like to call it the ‘next normal,’ because that reflects the understanding that we are dealing with a constantly changing target now.”
For financial brands, she continues, this demands an agile marketing mindset. Messaging, media usage, product design, selection of prospects and much more must all be fluid and capable of being shifted more quickly than ever before. She hesitates to even predict where ad spending will go, because she sees that also as a fluid matter, as messages in the marketing omnichannel go where they are best suited.
Move Beyond a Financial Product Mindset
Harder says that financial marketers increasingly must realize that from the consumer perspective any message about financial services may potentially concern broader matters than just money. People are more than account holders and think more broadly about the financial products they use than simply product features.
Smarter marketers are getting this subtlety, according to Harder. One example is the “She-Cession,” a term that recognizes that in many ways the current COVID-19 recession has hit women harder than it has many men. This occurs in two ways: 1. the impact of the pandemic on professions typically dominated by women, such as caregiving, and 2. the impact of lockdowns on the role of many women in child care and schooling from home.
Financial brands have featured more women in advertisements and have chosen women to narrate ads more frequently. She notes that Robinhood “has leaned into women” in recent efforts and that Ally Financial has been featuring women in ads that try to move the conversation from traditional savings more towards investing.
“I give them credit for putting women front and center,” because that’s a demographic that is looking for more investment help,” says Harder.
However, she adds, the marketing focus needn’t be right on finances all the time. “Although that is a key part of the stress and anxiety that women feel, it’s not the whole picture. Women are juggling life, career and family. That’s a lot, which is why the pandemic and the recession has hit them so hard.” In a report on the financial marketing outlook, Harder cites SoFi’s Women in Leadership YouTube series as an effort that goes beyond money.
Harder also likes the blogs that Ellevest runs. “They have a whole section on managing your career, and it’s all about empowerment and trying to help women get to the next level, be it personally, professionally or financially.”
Reaching out to relieve COVID-related stresses for women is an example of the need to help all consumers, as well as small businesses, to cope with heightened stress. Harder cites Bank of America’s Life Plan program, which blends personal goal-setting and financial planning in one platform.
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Time to Advance to the Next Stage
She believes financial institutions need to move to stage two, relaying the message that “we understand that there’s stress, but there’s the next step, where we help you manage the stress.”
“We’re seeing legacy financial brands being challenged by fintechs with innovative products that are really changing the mold.”
— Lily Harder, Mintel
In this regard, Harder believes banks and credit unions need to move beyond simpler COVID-related solutions like contactless banking. That is important, as is continued messaging indicating that institutions are taking safety measures seriously, but the heavy lifting on that was last year. Americans have made the transition.
“We’re seeing legacy financial brands being challenged by fintechs with innovative products that are really changing the mold,” says Harder. “They need to differentiate themselves by incorporating into their own suites of offerings the types of fintech products that are gaining in popularity.” The ones that Harder cites as priorities dovetail with the stresses of the COVID recession: buy now, pay later financing at the point of sale, early access to paychecks, microloans and other new forms of credit.
The truth is, while everyone is striving to handle COVID challenges, “everyone’s kind of tired of hearing about COVID.” 2021 will be the year of discussing solutions to repercussions.
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Rethinking Product Lines and In-Person Banking
Harder says the two-tier economy, where some people have lost their jobs and income, while others have been relatively unscathed or even prospered, has implications for financial product design. She says differing needs will create demand for divergent products, but adds that financial institutions must be careful not to market these as superior and inferior alternatives. That would send unfortunate messages.
A critical distinction: “It can’t be packaged as two separate offerings,” says Harder. “I recommend that instead of trying to create one bucket for this type of consumer and another bucket for that type, that institutions think more of à la carte offerings, allowing consumers to pick and choose. They can then assemble what they need in a package that can be more valuable than the sum of the parts.”
Harder says banking institutions can find some interesting examples of this in the insurance business.
“You no longer have to sign up for an entire term of coverage,” Harder explains. “You can pick up monthly coverage. You can even buy life insurance just before you board a plane and cancel the policy later.”
The other major challenge is figuring out how to reintroduce the human element to banking in new ways.
“I don’t think COVID killed the human element in banking,” says Harder. “The human element is very important for all of us, especially after almost a year of social distancing, isolation and lockdowns.”
However, she adds, the human element will be delivered differently, in many cases. “It could be in a branch with a mask, or via making an appointment online or having a video chat or phone call.”
Indeed, adds Harder, “there’s going to be somewhat of a race to find the most innovative way of delivering that human interaction and making it as valuable as possible.”
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Is It Time for Some Financial Brands to Try Humor?
This brings up the role of humor in marketing — laughter, after all, has been called the best medicine. While America could certainly use a laugh right about now, Harder notes that few traditional financial brands have tried humor. While outliers like Ally often use humor to make a point, few other brands have gone that way during the pandemic.
“Humor absolutely has a place when done tastefully, when done respectfully and when done in a way that the majority of consumers can absolutely relate to. And I think that’s what they are looking for, humor they can relate to, as opposed to something just being off the wall,” says Harder. She says some nonfinancial brands have used humor to perk things up — a strong example is Mint Mobile’s use of actor Ryan Reynolds in social media — but she thinks many financial institutions still avoid humor, possibly because of the bad experience Chase had in social with its “skip the coffee” comment.
“Unfortunately,” she says, “that has made many brands nervous about getting a little snarky.”
And Then There’s the Serious Side
Another important trend is the public’s continuing demand that brands of all kinds take a stand on social issues. This began among younger consumers a few years back and have escalated during the racial issues of 2020.
“There’s a lot more pressure on brands to make it clear where they stand on a particular issue,” says Harder. “That makes brands nervous because this can be very tricky — even alienating. But consumers are looking for brands that make such statements and that make them part of their values and ethics.”