In financial services marketing, the original digital divides — first, internet access, and later, access to the expanding number of cloud-based tools that followed — are now a mostly level playing field. The advent of the Covid-19 pandemic, and resulting digital acceleration on all fronts, has led to further technological equity. And the driving force behind all of it is data.
Financial institutions of all sizes have access to customer data, on a greater scope and level of detail, than ever before. But with this equitable access, another divide has emerged: between those institutions that have mastered their understanding of that data and how to apply it to their business goals, and those that haven’t.
At a meeting of Deluxe’s Midsize Bank CMO Exchange, a quarterly conversation with CMOs from financial institutions around the country, marketing leaders shared insights about their challenges, along with ideas and solutions. Here are the most significant takeaways from the conversation.
Working With the Budget You Have
With the year’s end in sight, we began our conversation right where you’d expect: budgets. The bank CMOs in our group expect budgets to essentially remain flat in 2022. In the absence of increasing budgets, the focus is instead on where to invest to gain and defend competitive advantage, and what those choices say about an institution’s priorities.
If you can’t outspend the competition, outmaneuver them.
It’s all about knowing your value proposition, and what you can do that the competition can’t. The CMO of one midsize bank offered this perspective: “It’s hard to compete with the large [banks], but what I like to say is, ‘I can’t outspend them, but I can outmaneuver them.’”
For this bank, the outmaneuvering happens at the branch level, where the bank or credit union’s central marketing team will tailor tactics individually particularly when it comes to social media. “We can do more because we know these markets. Traditional spend at the high level, plus micro tactics at the branch level, plus really strong social play, has been the right ingredients for us to justify that spend.”
In other words: If you can’t compete on one level, find another where you can. Where are you limited, and where can your team’s unique resourcefulness help you excel?
Comprehension Is King
Participants agreed that while they have access to the same tools as larger institutions and neobanks, they need to learn to navigate those tools more effectively. The true competitive gap isn’t correlated to a bank or credit union’s size, but rather its level of understanding of available data.
One of our panelists shared a recent firsthand experience that bore this out. On the surface, they had access to all the data they could need following a recent acquisition, but that potential has remained unrealized and campaigns in new markets have underperformed so far: “We’ve got a lot of work to do in understanding our data and making sure we can put it to use.”
Again, the size of an institution doesn’t determine the quality of the data it receives. In the words of one of our panelists, “They have deeper pockets, so they’re spending more money — but at the end of the day, it’s about effectiveness.”
Adding New Skill Sets: Difficult But Essential
Modern marketing teams need not only data-driven, strategic thinkers with intellectual curiosity and an experimental mindset, but also those with the technical knowledge to leverage available tools and resources to amplify what’s working. Unfortunately, these skills are in high demand across industries, and the pandemic has made finding talent much harder.
In some cases, leveraging outside partnerships can effectively bolster marketing sophistication at an organizational level, but there’s no one size fits all approach. It’s a perennial question for marketing leaders, and a subjective one, too.
“It’s a constant evolution of adapting to the changing needs of the bank and aligning the marketing team to execute on everything the bank is trying to do,” explained one CMO on our call, adding that their marketing group is employing a combination of both internal and external talent to get the results they seek. “Whether it be creative strategy or data, we know the resources are out there. It’s a matter of, ‘Does this fit the direction the company is trying to go in?’”
The Case for a Chief Analytics Officer
In recognizing that some data challenges can’t be solved by marketing alone, many of the CMOs we spoke with were seeking some form of cohesive leadership in areas like testing, insights and rapid development. One possible solution is an emerging position across executive boards: a Chief Analytics Officer (CAO).
CAOs exist at all sorts of companies, but within a financial institution a CAO can ultimately serve as the leadership needed to unite the different silos accessing data. While the organization may have a data repository, it still needs someone who can create a unifying recommendation with data. The CAO can fuel that strategy side, and really dig in to understand and help form that information. However, panelists agreed that getting buy-in from senior leadership could pose a challenge, since a CAO role and a broader embrace of analytics require significant investment.
Our quarterly conversation was an engaging dialogue, and we appreciated hearing firsthand how these marketing leaders are evolving and meeting the common challenges of the current moment. We look forward to checking in with this group early next year when they meet during Deluxe Exchange 2022 in Miami, Fla.
The Deluxe Midsize Bank CMO Exchange includes 30 to 40 CMOs at any given time, and we do selectively welcome new members.