‘We are transforming our marketing organization to prioritize targeted data-driven customer acquisition and lead generation programs.’
By Mark GibsonThe role of the bank marketing function is continuing to evolve to become more critical to overall enterprise, according to a new survey of bank marketers conducted by American Bankers Association. However, a considerable gap still exists between the broad and growing responsibilities of the function compared to how marketing is measured and evaluated. Here are some highlights:
Marketing is regarded as an important function
Consistent with last year’s study of the same topic, the marketing department continues to report into the organization at a very senior level, as 93 percent of this year’s respondents report to a c-level executive or executive vice president. Sixty percent report directly to the CEO. Additional evidence of the essential nature of the function is that 52 percent of marketing leaders report attending all or most senior leadership meetings, defined as CEO-direct-report meetings.
The role is broadening considerably from traditional marketing and communications
An important and encouraging finding of this year’s study is that marketing’s responsibility is evolving and expanding into areas that are viewed as essential to future growth of the enterprise. While we would expect marketing to have responsibility for advertising (98 percent), branding (95 percent), and communications (92 percent), critical areas such as marketing strategy (89 percent) and public relations (86 percent) also fell within the vast majority of the respondents’ domains.
What is particularly interesting is that emerging and essential areas such as digital channel management (website and/or online account opening at 76 percent), data and analytics (48 percent), social media management (95 percent) and marketing technology management (CRM, MCIF, and/or marketing automation at 51 percent) were also part of marketing’s responsibilities. This clearly supports the trend seen in other industries that the marketing function is taking on a growing responsibility in customer data analytics and insight which then drives more intelligent and personalized marketing efforts, typically through the digital channel.
Another trend to watch is that customer experience was mentioned by 47 percent of the respondents as being housed in the marketing function. Marketing has represented the ‘voice of the customer’ for years in many financial organizations, but the fact that this has been formalized in nearly half the institutions represented by this year’s survey is an important finding.
Some critical ingredients are missing
This year’s survey reinforced the fact that marketing is for the most part still viewed as “an expense to be managed, rather than a revenue growth function.” This was most dramatically revealed when respondents explained how marketing’s success is determined; 57% percent said it was the satisfactory completion of tactics and activities, and 14 percent said expenses needed to come in under budget. Only 13 percent are evaluated based on achieving revenue growth objectives.
This was reinforced when the respondents identified what functions resided in the marketing department. Product management was cited 25 percent of the time as was internal business line collaboration, while sales enablement was viewed as a job for marketing only 24 percent of the time. Most critically, ‘revenue generation’ was cited as a role of marketing only 28 percent of the time.
This finding identifies a major disconnect with what is happening in other industries. It is becoming more common for the marketing and sales functions to closely collaborate, or even be combined as the ‘Growth Department.’ What companies in a variety of industries have found is that the pandemic accelerated a trend that was already emerging—the first step in sales often happens on a company’s website. A prospect hears about your company or is simply doing an online search, and lands on your website. At that ‘moment of truth,’ a prospect is interested enough to download some information or fill out a form, or they are not. In this way, marketing is playing a larger role in lead generation and revenue growth for most industries.
“Marketing is being tasked with some of the most pivotal sales and customer acquisition programs across the bank, including a recent push for deposit growth,” says Jason Kincy, chief marketing officer of Arvest Bank. “We are transforming our marketing organization to prioritize targeted data-driven customer acquisition and lead generation programs.” Arvest’s experience is reinforced by the survey results. Marketing is supporting small business and commercial lead generation in addition to consumer household growth.
The future is now
This year’s survey provides positive evidence that bank marketing functions are broadening their roles and mirroring trends seen outside financial services. It also reinforces that definitions and metrics of success need to evolve just as rapidly to ensure that marketing leaders are focused on the business result to be attained, not solely on successfully accomplishing tasks. An important component of this is for marketing teams to make sure they are establishing measurement and reporting that shows correlation between the hard work they are doing, and the deposits, loans, or new customers that are being generated.
Mark Gibson is marketing practice leader at Capital Performance Group, a strategic consulting firm that assists banks in making the most of their marketing efforts. He can also be reached on LinkedIn.