While marketing has been rapidly evolving in form and focus in the past few years, the year ahead promises an acceleration of trends that will leave financial marketers and their banks and credit unions at a competitive disadvantage if they don’t keep up.
The trends come from many disciplines, ranging from the multiple roles of artificial intelligence in marketing to the growing impact of privacy legislation and regulation to the increasingly sophisticated approaches and skills required to get the job done. Other trends overlay the others, such as the increasing transition to an “emotion economy” — one where the importance of product features and functions rank less importantly than how consumers feel about what a brand stands for on social and political issues.
The trends reviewed in this article come from a broader report by Acoustic and eMarketer, and from commentary on the trends by Michael Trapani, Director of Marketing at Acoustic.
1. AI will Deliver Best By Informing Human Decision-making and Carrying Out Orders
A modern marketing paradox can be seen every day in your own mailbox — both the one for email and the one for snail mail.
“Brands still send consumers an overwhelming amount of marketing messages that are irrelevant, generic or only mildly segmented or personalized,” the report states.
Why does all this wasted time, effort and paper continue? Paradoxically, one reason is that the multiplying amount of data available about consumers has outstripped the ability of the unassisted human mind to make sense of it all, let alone react appropriately, according to the report.
“Enter AI and machine learning-based marketing tools that are changing the nature of how marketers make decisions and deploy campaigns,” the report states. “While humans still are in the driver’s seat with respect to strategy and creative, machines can analyze, process and deliver personalized content at a massive scale.”
The report points out that while deeper personalization is increasingly possible, an inhibiting factor has been an inability to draw on the growing volume of tailored content for each consumer in the proper combination. Here, AI-based systems can process financial marketers’ specific rules and directions and then create and deliver individualized content to each recipient. Increasingly this hyper-personalization is based on the predicted behavior of the individual rather than a static segment.
Trapani says that ideally AI doesn’t make the decisions for the marketer, but instead renders recommendations. The technology is not quite where AI acts as a “consultant,” but Trapani believes it is nearing that point.
The report contains an example. A financial marketer could receive a message from one of the institution’s marketing tools predicting some falloff in business in the near future. The consumers who could be lost are analyzed. Marketers devise a package of different offers and communications to retain as many potential defectors as possible. The AI would take the package of responses created by the human marketer and feed the right combination of content to each identified consumer.
- How Banks and Credit Unions Can Grow Deposits with AI
- How Regions Bank Uses AI to Up Its CX Game (And Boost Revenue)
- 5 Ways Financial Marketers Can Gain Seats at the Strategy Table
2. Increasingly Best Marketers will be ‘Martecheters’
If marketing was ever solely about being a “right-brainer” — creative and artistic — the skill set has expanded into a “whole brain” assortment of abilities.
“Single-skilled marketers can’t analyze oceans of data created by the widening range of customer touchpoints while also developing captivating creative, nor can they afford the constant developer resources needed to implement cutting-edge marketing tech stacks,” the report says. “In short, there is a skills gap between corporate and digital-native marketers, and it’s pretty big.”
Two implications come of this.
First, the skills that go into the makeup of marketing department teams have been broadening. Even among somewhat smaller financial institutions, according to discussions with readers of The Financial Brand, bank and credit union marketing departments have been hiring for data analytics, video, social media and other skills.
Second, somewhere in marketing departments there must be someone who understands martech — the “martecheter,” to use Acoustic’s term.
Part of the skill of this person is the ability to apply the elements of a financial institution’s martech stack in a more holistic way, according to Trapani. Marketers tend to think of each element of their stack separately, which misses the synergies that can be obtained by interconnecting them.
Add a “Director of Marketing Data”? The report suggests, in a related vein, that one of the key new roles that institutions should add to their marketing departments is the post of “director of marketing data.” This person becomes the nucleus of the data accumulation and analysis operations, coordinating internal and external suppliers’ effort to integrate diverse sets of data and to centralize it in a useful way. CMOs who develop such skills will increasingly play a role beyond marketing to having a voice in overall creation of customer experience.
People in this role will be one of the human connections between AI and what the bank or credit union wishes to accomplish with its data.
Rise of consulting agencies. The report cites as another trend the blurring of the lines between consulting firms and marketing and advertising agencies.
“The marketing services units of Accenture, PwC, IBM and Deloitte sit just below WPP, Omnicom, Publicis Groupe, Interpublic and Dentsu,” the report says. “What is common across many of these newer digital agencies is a consulting and solutions mindset often combined with deep focus on technology-based services.”
Acoustic’s report refers to these evolving firms as “consulgencies.”
3. Smarter Marketers will Turn Data Rules into Voluntary Quality Control
Financial institutions are all too familiar with government regulations. One set of rules that will complicate efforts to better utilize consumer data is the rising tide of privacy and data use laws. However, Trapani says that there is a benefit for organizations that adapt voluntarily to growing interest in consumer data protection.
“Privacy, in my mind, is a right,” says Trapani. “It shouldn’t be an afterthought, something we think about only once we have built everything we need to build. Customers are trusting marketers with a lot of information. You can’t take that lightly.”
Multiple bodies of law are growing in this area, he points out. First there is Europe’s General Data Protection Regulation, which governs collection and use of data on Europeans there and abroad. Closer to home there are new data privacy regulations coming into effect in 2020 in California — other states may follow. Trapani says the California law was a direct result of marketers not taking data safeguards seriously enough.
Rules improve results. He says that there’s been an interesting side effect in countries and regions where stiffer data privacy rules have been: The performance of marketing campaigns has improved.
One reason is that marketers in those areas start with cleaner lists, because they have had to cull those people who don’t want marketers to use their data. As a result, communications go to a group that begins as more willing. He suggests that voluntary efforts to provide greater opportunities to opt in or out of data sharing could produce more effective lists and more successful campaigns.
“It’s a more-engaged audience,” says Trapani “and marketers sleep at night.”
Longer term, the report suggests, marketers will move away from a list-focused mentality toward “an exchange of secured and trusted data that allows for deeper personalization of content from marketers to buyers and vice versa,” the report predicts.
Read More: 3 Steps Banks & Credit Unions Should Take as Data Privacy Gets Hotter
4. ‘Agile’ Marketing Thinking will Become the Rule
Traditional financial institutions still suffer from the inertia of a plethora of meetings, and decision processes that appear glacial compared to the ideal projected by fintechs and challenger brands.
“As digital transformations accelerate and a demand for exceptional customer experiences grows, marketers and CX professionals are faced with the new realities of thinking, working and collaborating to support their businesses,” the report says. “More and more marketing teams are adopting agile frameworks as part of their transformations. They must prioritize their work by understanding which problems they’re looking to solve and why, while they define which outcomes need to be achieved and measure within a given sprint.”
The report indicates that stripped of some of its jargon, agility in marketing consists of five practical elements:
- Greater ability to shift gears and manage changing priorities.
- Tighter business alignment and objectives.
- Increased delivery speed and time to market.
- Improved team morale and team productivity.
- Higher output in the quality of work.
“Organizations driven by culture change and agile mindsets have a first-mover advantage, especially where AI-powered marketing technology is enabling the right sets of tools to align and measure the proper objectives and metrics,” the report suggests.
Read More: How Financial Institutions Can Thrive in the Age of Digital Disruption
5. Consumer Loyalty Won’t Just Hinge on Your Own Products and Services
There is a growing belief that brands should take stands. “Consumers are making more decisions based on the values of their brand than based on features and functions of what they provide,” says Trapani. “Brands are being asked to take a stand and pick a point of view on social issues.”
The report cites this shift on what it terms “the emotion economy.” The report suggests that brands need to find “emotional triggers” that cause people to buy from one brand over another and to experience growth.
“If a brand wants to sustain that growth, it must pull these emotional triggers again and again,” states the report. Marketers must also recognize the risks of consumers voting with their virtual and physical feet when a brand is perceived to transgress. The report cites the period of fiascos experienced by Uber as a reason cited by some consumers to delete the company’s ride-sharing app.
But are there risks to attempting to become a “purpose-driven brand”? Faking it is a good way to have the effort backfire.
“This shouldn’t all come down to the marketing team,” says Trapani. “This stand should really be something that is true and believed in by your leadership and the employees of your company. This can’t be fluff.”