5 Ways Bank Marketers Can Simplify Strategy and Kill Complexity

Financial marketing has become mind-numbingly complex as data and technology innovations show no signs of slowing. The impact of artificial intelligence alone is daunting. Key strategic and tactical suggestions will help cut through the chaos.

Mention marketing complexity and most financial marketers will think first of proliferating technology, data challenges and the explosion of channels. Those are all a big piece of it, to be sure, but rapidly changing consumer preferences for how and where they interact with financial brands adds greatly to bank marketers’ challenge.

It’s tough to find the right balance when marketers must stretch limited budgets and feel that they need to be on every platform and channel.

And, oh yes, be creative!

To help map out a practical path through this maze of complexity, Jim Marous, Co-Publisher of The Financial Brand and CEO of the Digital Banking Report, spoke with digital marketing expert James Robert Lay for an episode of the Banking Transformed podcast.

Lay, Founder and CEO of the Digital Growth Institute (DGI), has helped more than 500 financial institutions focus and simplify their digital marketing strategies. He is also the author of “Banking on Digital Growth: The Strategic Marketing Manifesto to Transform Financial Brands.”

Asked how bank marketers’ should begin to deal with increased complexity, Lay’s answer is in itself testimony to the speed of change in the marketing profession: “A few years ago, ‘strategy’ would have been my default answer,” he states. “Now I make the argument that to really begin any type of transformational initiative — in marketing or technology — start with training and education, not strategy.”

That observation leads into the first of five ways bank marketers can cope with the complexity of modern marketing as described by Lay.

1. Truth and Training Reduce Complexity

Strategy won’t accomplish much when there is no common understanding within an institution of what’s behind it. When people don’t understand something, they typically don’t want to do it, Lay observes.

Bankers must tell the truth about where their institution has been, where it’s at now, and where it can and should grow next, Lay maintains. Without that, marketers will hear a constant stream of different ideas from groups within the organization. Everyone’s got an opinion, which adds greatly to complexity.

That’s where the training comes in. It provides context, a framework and a common language among Marketing, Sales and the C-Suite. Structuring the conversation “takes some of these pie-in-the-sky ideas, and begins to simplify them down into things you can communicate around,” says Lay.

To take this viewpoint from concept to implementation, the consultant created a six-step marketing framework to help implement transformation. It’s built around the acronym “BANCER” (pronounced “banker”). It stands for:

  • Build an audience with data.
  • Attract qualified leads with personalized offers.
  • Nurture those leads with content through automation.
  • Convert prospects into loan and deposit customers.
  • Expand the relationships by delighting customers.
  • Repeat the process using reviews, ratings and ultimately referrals.

2. Start at the Bottom for a Quick Win

Rather than tackle all six steps listed above at once, Lay recommends bank marketers start with one thing to get a quick win. For example: Figure out how much opportunity you’re missing by checking your digital conversion rate. He says DGI studies have found abandonment rates are exponentially high — 85% to 95% — for online loan and account applications at banks and credit unions. The focus then becomes how to reduce that by improving the consumer’s user experience.

UX changes may take time. However, an immediate step banker marketers can take is to follow up promptly on abandoned loan or account applications. “It’s just simple outreach,” says Lay, “nothing complex at the top of the funnel — no new ads or channels — just really focused on what you’re losing today.”

Sometimes the Simplest Things…

Banks have increased conversion rates by 15% to 20% just by sending a follow-up email or having a human make an outbound call to people who abandoned an online application.

“Many times bank marketers want to do top of the funnel, traffic-driving stuff,” says Lay, “but often that just drives more complexity.” Fix the conversion challenges first, he advises.

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3. Why ‘Community’ Means More Than ‘Audience’

Modern marketing focuses so much on metrics in all their inherent complexity that the human connection often gets lost. As a marketing consultant, Lay says he was big on “audience building” for a long while — up until the pandemic. That’s when he realized that “audiences” per se aren’t so important, because they typically are still a one-way communication. What’s needed is a dialogue,” Lay believes; “a discourse within a community.”

Traditionally in banking, “community” is thought of as a place. That’s still true in some markets, but community increasingly is not defined by boundaries or zip codes. Lay takes the concept to a different level. He speaks of community in the sense of value provided to people by a financial institution that goes beyond dollar value.

“A lot of what banks consider innovation — product innovation, marketing innovation — has been driven by what a bank needs,” he observes. “Going forward, if financial institutions can build communities of like minds, they can begin to solve the problems causing common people pain.” This is about more than financial wellbeing, he adds. Money clearly impacts mental and relational wellbeing, as well.

“Banking is not just about dollars and cents anymore. It’s about the humanity of money, if you will — how money impacts different areas of a person’s life.”

— James Robert Lay, Digital Growth Institute

This may sound idealistic. But Lay believes the concept of community he describes has great potential for a form of coaching to help propel people toward what they want to achieve. This, he feels, represents a revenue opportunity for banks.

As an example of what he’s talking about, Lay describes how Florida-based Tropical Financial Credit Union has a program called “Get Beyond Money.” It’s a virtual community meet-up in which people talk about money and financial stress. To work, this sort of forum requires a catalyst to get people to open up. In this case, says Lay, VP of Marketing Amy McGraw fills that role by sharing her own story of financial struggle.

4. Embrace AI — It’s Non-Negotiable

All the emphasis on the humanity of money does not take away from the fact that technology enables much of this to happen effectively. And while most bank marketers are wrestling with how to get up to speed on the effective use of artificial intelligence, Lay believes it must be mastered. “AI allows bankers to make proactive recommendations far beyond what a human on their own would have the ability to do,” he states. That includes internal intel such as identifying a potential customer defection. But more than that, Lay believes AI is about using pattern recognition to inform bank staff about a customer’s situation to enable very specific outreach.

“Many financial institutions still operate in a very reactive state,” Lay maintains. “But through AI, they can now take a proactive stance in a person’s financial life.” This is crucial, he believes, because banking is, and will remain, a business centered on people.

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5. Adapt to New Restrictions on Data

Bankers have been hearing about the need to “help first and sell second” for some time, especially since the Wells Fargo sales scandals. Lay observes, however, that that mantra is also a very practical guideline given the many changes to data-use rules that are complicating marketers’ lives.

“We’re seeing the demise of third-party cookies,” says Lay, “and digital advertising is not going to get any easier going forward. We’re probably going to see a further clampdown on use of personal data.”

He particularly singles out Apple’s iOS 15 update that limits marketers’ ability to track open rates and click rates in Apple Mail.

Marketers' Nightmare:

Imagine all of your Gmail data, and maybe even all your Microsoft Outlook data, being gone one day.

These ongoing data-use changes mean search and SEO marketing will have growing importance once again. And that, Lay observes, brings content into play. “It’s all about the conversation,” says Lay.

He can see a marketing scenario in which banks and credit unions create podcasts for their different lines of business to which current, or former customers are invited. These podcasts could easily be turned into multiple forms of content.

The trend impacts social media as well, where Lay believes that “micro has the potential to beat macro.” What he means by that is, banks can turn key employees —lenders, branch managers — into micro influencers within a local community, to help first and sell second.

That effort is also about “giving customers hope,” says Lay, “because when they have a problem, they have a human being they can turn to.”

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