By Mary Ellen Georgas-Tellefsen
In the latest installment of our ongoing series on traditional versus digital bank marketing, we take a closer look at the pros and cons of traditional marketing methods. Our next piece will take a similar approach to digital marketing methods.
These days it’s not often we get excited about traditional marketing methods—except maybe when we’re thinking about the dollars we can reallocate from traditional to digital marketing. However, you still have many good reasons for retaining your traditional marketing efforts and maximizing their effectiveness.
For example, for raw brand building—the foundation of any successful marketing effort—TV ads and outdoor displays (yes, billboards) continue to reign. If customers don’t know you and trust you, they’re not going to buy from you.
Other traditional marketing methods that still work, under the right circumstances, include print, radio, direct mail, signage, events and face-to-face meetings. For some marketers and some target markets, even phone calls get results—if they didn’t, your landline would never ring at dinnertime.
It all depends on your strategy, goals and target market. Here are four situations when traditional marketing methods remain your best option:
1. When you need to raise awareness
If your target audience is not aware of your brand—or doesn’t know enough about your brand to place you in their consideration set—then you need to embark on a brand awareness campaign. This includes when you open a new branch or enter a new geographic market. These campaigns are most effective using a combination of all marketing methods, but mass-media traditional channels tend to outperform other channels when you’re working to raise brand or product awareness.
2. When you are trying to convey emotional elements of your brand or value proposition
Your bank’s employees live the brand value proposition through their actions and interactions with customers every day. Nothing beats a human connection. And when you can’t use the human touch to make that connection, you can use video to communicate and convey the emotional side of your brand. Although video is an increasingly digital medium, it also remains a staple in the traditional toolbox.
3. When you want to get an offer into the hands of a specific consumer or business owner
Digital marketing is improving its targeting, personalization and customization capabilities every day. That said, direct mail built the foundation of segmentation and target marketing. And it continues to be one of the most effective marketing tools at your fingertips—and one of the most measurable.
4. When you are selling a high-value service like commercial banking, private banking or wealth management
Complex, high-balance financial transactions usually call for a more personal relationship between the banker and the customer. The same is true for the marketing of these services. Communications need to be personalized, clearly explained and in writing. Digital methods can’t convey the same gravitas as a personal call or letter when you’re dealing with high-value clients and deals.
Why exactly does traditional marketing work better for those purposes? Consider the particular strengths of traditional marketing.
- Pro: Traditional marketing is harder to ignore. You can surround your prospect with your brand, value proposition, message and products via a public multi-media campaign. Mass media—TV, billboards, stadiums, buses—creates mass effect and impact. (There is a reason naming rights for stadiums are so high.) Out in public, your potential for brand exposure to the mass market is enormous.
- Pro: Traditional marketing offers DIY options. Many traditional channels—direct mail, events, personal contact—are easy for your marketing team to execute themselves without the additional cost of an external partner or agency.
- Pro: Traditional marketing poses less potential risk for your brand. Offline, you can more easily control your brand and message, as well as how it is displayed. And for some audiences, traditional marketing methods demonstrate the stability and security of the brand.
- Pro: Traditional marketing is better at reaching certain audiences. Certain key banking customers continue to use traditional media as a primary source of information. CD campaigns, for example do well in local newspapers.
- Pro: Traditional marketing, in the form of direct mail, is better able to deliver specific offers for specific people. While email marketing is making strides, direct mail is still the best way to truly target specific people with specific offers. The advantage of direct mail over digital communications is especially strong when you’re targeting existing or former customers.
Factoid: Direct mail returned an average response rate of 9 percent for house lists and 4.9 percent for prospect lists last year, according to the Data and Marketing Association’s 2018 Response Rate Report. Feb 26, 2019.
Of course, every story has two sides. Consider the cons for traditional marketing.
- Con: Traditional marketing can be more expensive than digital marketing. This is especially true when you add in the total costs of production and the media buy.
- Con: Traditional marketing is often not as measurable as digital marketing. While there are services to estimate TV viewership and billboard drive-bys, they are still estimates. Digital media can pinpoint metrics along the entire marketing funnel, from page landings to click-throughs to purchases.
- Con: Traditional marketing can take longer to execute and refine than digital campaigns. Producing a print ad takes time—and rounds of edits. Then once the ad is done, it is done. There is no going back to change a color, font or word. Digital ads, on the other hand, can be tested and edited in real time to improve their effectiveness.
- Con: Traditional marketing doesn’t have the same ability to target and sub-segment as digital. Other than direct mail, most traditional marketing methods cannot and do not offer the same level of segmentation and targeting that can be achieved with digital targeting.
- Con: Traditional marketing is gradually losing its audience. When designing your campaign, you have to think about who watches regular TV or reads a newspaper these days. While there are very clear segments of network TV viewership and physical newspaper readers, there is no doubt that paid TV subscriptions and e-readers are changing the way people of all ages consume news and media. Traditional media outlets are learning to adjust for a new generation of consumers, and so must financial marketers.
It’s critical for marketers to learn new things and devote resources—time, money and staff—on exploring the latest and newest channels. However, don’t be so distracted by the shiny new objects that you abandon what works best, just because it’s traditional. Strive for the right marketing balance for your institution, taking into consideration not only your past success rates, but your target segments, your budget and your overall marketing objectives.
In the next installment, we look at the pros and cons of digital marketing.
Mary Ellen Georgas-Tellefsen is an experienced banking industry consultant and has helped clients develop customized in-house learning programs, such as the one described. She is the Marketing Practice Leader at Capital Performance Group, LLC, providing strategy, marketing, and digital channel consulting services to the financial services industry. LinkedIn.