By John Oxford
Much like the old saying that “there are only two certainties in life, death and taxes,” when it comes to bank marketing, there are only two certainties: you will be asked to increase loans and deposits. Without one, as a traditional bank, it’s really hard to have the other (or at least to make any money).
While we could discuss various loan and deposit growth strategies, for brevity, we’re going to discuss an interesting trend in bank advertising of late: big retail deposit campaigns.
Here’s the deal: Moving a bank account, much less a full banking relationship, is hard. Most bank marketers recognize this, but many banks continue to market as if 100 percent of the market is always in play.
It’s not. According to Morning Consult, only 5 percent of any given banking market is very likely to move their bank account this year, and only 6 percent is somewhat likely. “Half the money I spend on advertising is wasted; the trouble is I don’t know which half,” the 19th-century retailing pioneer and marketing wizard John Wanamaker famously said. He would be a striking success in losing only 50 percent of his advertising dollars, compared to retail bank advertising looking at an 89 percent failure rate, extrapolating from Morning Consult’s findings.
To combat the 11 percent market opportunity, banks use many differentiators. They make big offers on targeted balances with time triggers, rewards for certain actions (such as swipes, direct deposit and e-statements), subscriptions with discounts and high-value add-ons (such as 24/7 roadside assistance and cell phone protection) beyond just paying a higher interest rate or providing free checking. And each of these may find some measure of success depending on a variety of factors.
In a conservative industry with broadly similar products and regulations, a lack of naming differentiation (with more than 60 percent of financial institutions sharing a common word) and a mere 11 percent “opportunity” market, how should a bank marketer approach these challenges? One idea that I think is particularly suited to the challenge: reinvest—or invest for perhaps the first time—in your brand messaging.
To understand how brand messaging works, think about cars. Porsches are fast. BMWs perform. Volvo—safety. “If you said safety (for Volvo), you’ve given the same answer I’ve received from every person I’ve ever asked ever,” writes advertising guru Luke Sullivan. “In every speech I’ve ever given anywhere around the world, when I ask audiences, ‘What does Volvo stand for?’ I hear the same answer every time. Safety. Audiences in Berlin, Reykjavik, Helsinki. Copenhagen and New York City all give the same answer. The money Volvo has spent on branding has paid off handsomely. Volvo has successfully spot-welded that one adjective to their marquee. And here’s the interesting bit. In the past couple of years, Volvo hasn’t even made it on to the top 10 list of safest cars on the market. So here’s a brand that having successfully paired its logo to one adjective, safe, rides the benefit of this simple position in customers’ minds long after its products no longer even merit the distinction. Such is the power of simplicity.”
Automobiles are operationally and structurally very similar: four tires, steering wheel, doors and windows. They’re generally comparable to banks marketing-wise in that most everyone needs one, they are regulated and all the market participants pretty much do the same thing. In addition, people seemingly buy cars about as often as they switch banks: just when they absolutely have to.
Simple brand messaging works. It will work for your bank, you just have to find your brand message and drive it home. Take a look at your brand: what does it stand for and how you can communicate it simply?
At Renasant, our brand is Southern, cool and empathetic, which leads to our tagline: “Understanding You.” We understand the region we live in and we are empathetic to our clients’ needs. (If you noticed I didn’t say anything about cool, it’s because of the lesson from high school: if you say you’re cool, you usually aren’t.) You can check out how we portray our brand through our content site, Renasant Nation. More than 100 million views of our content shows on the site in 2019 back up its success. So what is your brand message?
Brand messaging will set you apart even with similar products and services. Americans know, for the most part, what banks do—but they don’t know what your brand stands for unless you tell them. So stop thinking like a bank and start thinking like a brand. It might be the only way to be on your potential clients’ minds when one of them decides to move from being an 89 percenter into an 11 percenter.
You can hear an in-depth dive on brand messaging and other tools for improving your bank marketing as I discuss this and more with Josh Mabus of the Mabus Agency on the latest Marketing Money Podcast.
John Oxford is director of marketing at Renasant Bank and co-host of the Marketing Money Podcast.
