By Mary Ellen Georgas-Tellefsen
In the latest installment of our ongoing series on traditional versus digital bank marketing, we explore the pros and cons of digital marketing methods. Last month we focused on traditional marketing methods through a similar lens.In many respects, it still feels like we’re in the nascent stages of working with digital marketing tools—especially in financial services. With all the agencies, products, metrics and methodologies to choose from, at times it may seem like the wild west. But the truth is, financial marketers can’t afford to wait it out any longer. Digital marketing is here to stay, and the sooner you embrace it, the sooner you can tap its potential for your institution. The best way to get started is by identifying when and where it will be your most effective option.
Here are a few examples of when digital marketing methods are the best tools for the job:
1. When your budget is limited
We get it. Marketing budgets are sometimes the first thing to go when times get tough. The great news about digital marketing is that you can do a lot with a relatively small budget. In general, you have more control over what you spend in digital marketing and it is less expensive than traditional campaigns. For example, you could spend $250 for a highly targeted LinkedIn campaign versus $50,000 for a broad-based TV campaign. And that potential for targeting can help you reach more of the right people at the right time, increasing your campaign’s ROI.
2. When you need to generate demand among a targeted group of people
Although traditional direct-mail marketing still has the edge when it comes to targeting certain audiences, like existing and former customers, digital can take some other targeting efforts much further, much faster. The ability of digital marketing to capture and analyze data can help you focus your marketing efforts and create hyper-specific segmentation schemes. Once you learn how to harness this power, you can efficiently and effectively pinpoint specific segments—and even individual consumers.
3. When you want to project a younger, hipper brand image
If you want to convey that your institution is modern-thinking and in tune with a younger audience, try shifting more resources to online advertising and social media. While all demographics are online, not all financial institutions are meeting them there. Banks that have a digital brand and communications platform to speak to online users may have a way to differentiate their brands.
4. When you’re committed to a mobile-first approach
Digital marketing includes a wide range of channels, like digital billboards, smart TVs, online, tablets, mobile phones…and whatever might be introduced as the next-generation device. For now, though, your marketing needs to be mobile-friendly, as over half of website usage today is from a mobile device—and this is only growing.
5. When you want to use multi-media to create an interactive experience for your audience
Traditional marketing is mostly one-sided—you can’t do much with a newspaper ad other than display your message. Digital marketing offers the tools to provide customers and prospects with experiences that communicate the brand and value proposition via multiple media—all in one message. An email offer, for example, could include embedded links, an interactive calculator to demonstrate the impact of a lower credit card interest rate, plus a how-to video on the application process. This flexibility allows the marketer to appeal to several different personal preferences all at one time.
However, even if your campaign doesn’t match any of the conditions above, a digital approach can offer significant benefits to any marketing program. Consider these pros.
- Pro: Digital marketing provides access to a vast audience and the capability for super-specific targeting. With a digital approach it’s easier to market to people far beyond your own geography, while maintaining a tight focus on those with particular characteristics and needs. Want to market to small business owners who own Christmas ornament shops? You can find a way to do that with highly specialized, yet highly broad segmentation capabilities offered by Google Ads and Facebook, for example. You can also use Google search data to serve up ads and offers to people specifically searching for accounts and deals with banks in your area. This is a very effective use of marketing dollars to communicate with people who are shopping for financial services.
- Pro: Digital marketing offers superior tracking and metrics.
- Pro: Digital marketing’s exposure is expanding. Consumer usage of everything digital is growing. Magazines are going digital, music, movies—even network TV is going digital. American adults spend over 11 hours a day looking at a screen, according to Nielsen and Forbes. Digital is where you will reach the largest audience.
- Pro: Digital marketing is cheaper to implement and maintain than many traditional marketing methods. Not only can digital assets be easier, quicker and less expensive to create, but once created, they are easier to maintain and revise for reuse. Producing TV and radio ads, on the other hand, is expensive and reuse is low.
- Pro: Digital marketing is customizable and enables better A/B testing and personalization. Marketing automation tools are making it easier and more cost effective every day to implement highly customized and personalized campaigns and communications. This is enabling better onboarding programs and communications that are helping many institutions develop deeper customer relationships right from the time of account opening. Digital marketing allows you to test, in real-time, the impact of every element of a campaign—from the offer itself to the fonts, colors, headlines, graphics and layout. You can use this capability to find out what your customers and prospects are responding to. Then use what you’ve learned to continually improve the effectiveness of your campaigns.
- Pro: Digital marketing gives you access to social media. Banks of all sizes are using social media to promote the institution, interact with customers and prospects and receive immediate feedback on what’s working and not working. Although a social media presence requires proactive reputation management on the part of the institution, when it’s done well, it creates a real-time online community and dialogue—something never before possible.
- Pro: Digital marketing give you access to new technologies like AI and machine learning. Have you heard that Chase is using AI to write marketing copy? It’s true. They have machine-learning AI analyzing what copy and words are the most effective marketing tools—then immediately improving the marketing copy.
For all the benefits of digital marketing, it also has its drawbacks. Here are a few of the digital marketing cons you’ll want to consider.
- Con: Digital marketing can be low impact from visual standpoint. The web is a crowded place, and its millions of ads can be easy to ignore. This is especially true on the small screen of a phone.
- Con: Digital marketing can lead to content and email overload. It’s important to be very thoughtful about the frequency of messages you are sending out to customers and prospects.
- Con: Digital marketing can be mimicked for fraudulent activities. We’ve all seen notices on bank websites regarding fraudulent calls and emails to customers. Unfortunately, this phenomenon is not going away and bank marketers need to be vigilant and proactive in avoiding cyber-crimes.
- Con: Digital can exacerbate a bad experience and poor reviews via social media. Remember, everyone can see your online reviews and customer complaints so you need to have a proactive approach to managing your online and social media reputation.
The breadth of vendors, tools and options can seem overwhelming to institutions just getting started in digital marketing. However, digital technologies can help marketers at banks of all sizes and budgets make the most of their marketing dollars and reach the right audiences. The key is to remain focused on your business objectives, start small, experiment and build out a digital marketing program—in concert with your traditional programs—to see what works best in your markets with your target segments.
Mary Ellen Georgas-Tellefsen is an experienced banking industry consultant. 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.