Too often, financial marketers focus their loan and deposit promotions exclusively (or at least predominantly) on rates. The assumption is that if the rate is good, the product will market itself.
But despite the perception that interest rates — whether they be paid or earned — are consumers’ top priority, this approach doesn’t always generate the best response rate. Why is that?
Marketing campaigns work best when they are part of an integrated strategy, one appealing to individuals at various stages in their journey. This increases the potential audience, stimulates overall interest, and creates opportunities for conversion.
Using a classic savings solution — a certificate of deposit — as an example, let’s explore how focusing on the rate alone can be limiting, and how incorporating other tactics into your marketing messaging helps accomplish your goals.
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1. Basic Awareness
If you were to ask the average consumer what a “Certificate of Deposit” is, there is a high chance they wouldn’t know, or might only know it’s some sort of banking product.
Reality Check: According to a study by Bankrate, 45% of consumers said they were unfamiliar (or only vaguely familiar with) “CDs”.
For Millennials, a generation that places high importance on saving, the figure is much higher. 69% of this group admitted they were “not very familiar” with a product that every retail banker considers to be the bread-and-butter in their deposit lineup.
These figures represent a substantial cross section of the overall audience. Now think about this carefully: when your target audience doesn’t understand the product you are pushing, rate-based marketing can’t work. In order to reach these individuals, it is critical to first educate them about what a “CD” is and how it can benefit them.
More people might be interested if they understood how it could help them save more money than other savings options — that it offers a reliable return on investment, and that it doesn’t require much effort to open an account. Promoting these benefits — along with your “great rate” — creates a more comprehensive campaign.
2. Establish Relevance
Even when consumers understand the benefits of a CD, they may not realize how it applies to their current needs. Financial marketers must first create a connection between the product and potential users, understanding that what is applicable for one audience might not apply to others.
Consider the CD example. Giving examples of longer-term savings presumes the audience is familiar with various life stages — e.g., paying for college, buying a home, retirement, travel, etc. But taking a more nuanced approach, the same product can be strategically targeted to different audiences, making it feel uniquely relevant to their specific needs and situation. This increases the relevance of the solution, and the chances for account-opening conversions.
3. Create a Competitive, Compelling Offer
If someone doesn’t understand that your rate is highly competitive, then promoting it won’t have the desired impact. Instead, providing context is essential to illustrating the value of your rate. Comparing it to the local average is a great way to accomplish this and make your offer more appealing to consumers.
“Even if consumers know a rate is good, marketers should help them make its impact on their life more tangible.”
Often, even if consumers know a rate is good, the outcome might not feel real to them. Making it seem more tangible can help consumers envision the impact to their life from opening an account. Bank and credit union marketers can provide an example of the savings a consumer could obtain from a CD with the minimum deposit and term. This makes the saving potential seem more obtainable, giving consumers more motivation to take action.
4. Promote in The Right Place to The Right People
Where you promote a product is equally important to the success of your campaign as how you promote it. A bank or credit union could have a great offer, but if they’re not reaching their target audiences, it won’t achieve the results they’re looking for.
For example, promoting a rate through a Google Ads campaign can help increase visibility among active rate searchers. These are the individuals who know about certificates of deposit because they are searching for related terms, and are closer to the point of conversion — making sponsored search ads a practical strategy to reach them.
However, there is still that large audience that wouldn’t see your search ad, perhaps because they don’t know what a CD is or how it can support savings goals. For this reason, it is necessary to incorporate other channels and/or strategies into your marketing campaign, so that you can attract individuals in various stages of the consumer journey. A platform such as social media or email can be used to distribute relevant educational content to create awareness and encourage consideration, which may ultimately lead to conversion.
As you look to plan your next retail banking campaigns, stop to reconsider all features, benefits, audiences, competitors, and platforms when promoting banking product solutions. Incorporating a mix of tactics and types of content will create an integrated campaign that more strategically positions your products to encourage action and see real results.