This should be the Golden Age of financial marketing. And yet banking providers have never faced such intense competition, nor has their future felt so imperiled. Customer satisfaction is sagging, and people are ready to fly to greener pastures.
These are all characteristics of a market desperate for innovative marketing and fresh solutions, but all we see from the banking industry is more of the same — lobbying, lawsuits and posturing.
Most financial institutions seem to be stumbling through today’s economy with all the precision of a toddler hitting a locked door with a baseball bat. Instead of looking for the key, banking CEOs are resorting to brute force as they try to beat down any obstacles. Instead of understanding the nature of consumers’ concerns and complaints, or examining what popular retailers are doing right, or borrowing consumer-friendly tips from fintechs, many banking providers are doubling down on the strategies they used last century.
While online retailers are creating innovative ways to deliver products or make life easier for consumers, banks are filing lawsuits to stop progress and block innovation. Banking industry groups are working to thwart fintechs and prevent them from receiving bank charters. Too-big-to-fail bankers want liquidity safeguards removed. And financial lobbyists are fighting consumer protections that have brought relief to millions.
There’s rich irony in an industry that espouses “market values,” yet pursues legislative protectionism with reckless abandon when the going gets tough.
Is it unreasonable to expect financial institutions to treat people fairly? Or are fines and penalties merely a cost of doing business in an industry that rejects accountability and introspection? The hits from regulatory agencies keep on coming — fines for discriminating against minorities, intentionally keeping customers in the dark, security and mortgage abuses, anti-laundering deficiencies and energy market manipulations.
Penalties and fines occur with such frequency and minimal blowback that you can only come to one conclusion: megabanks clearly don’t feel the need to seek better alternatives. Screw the customer? That’s just business as usual.
As long as banks can box competitors out and shape their own regulatory policies, they will continue to bang out big quarterly dividends, and customers will remain little more than “assets” on a spreadsheet with fees tweaked periodically to maximize returns.
For most successful organizations however, marketing is a critical tool. In fact, a Notre Dame survey of the world’s largest companies found that a sales and marketing background was the most common among CEOs. Not in banking. You almost never hear of any marketer rising to the top ranks in the financial industry.
None of the big bank CEOs are marketers. In fact, few give it more than lip service, opting instead to rely on lobbyists, new tech gizmos, and highly-incentivized sales people to hold on to market share.
My hunch is that a science requiring soft skills like listening, understanding and responding is much harder to execute that falling back on old-time habits.