Bank Marketing Strategy + Ideas

As you know, I spend a lot of time writing about marketing and advertising plans for financial institutions. The most common response I get is, “Great ideas, but where do I start?”  So, today I want to help you put these ideas on your calendar!

January: Start today promoting your IRA and SEP’s. Most people in America are starting to think about filing their income taxes before April 15th and many may be considering these types of products.

February: As the snow begins to melt, many cities hold their annual “home show.” This is a great time and place to promote mortgages and home equity loans.

March: When the weather starts to warm up, boat shows pop-up all over the country. It’s a great time to offer boat loans in all shapes and sizes. The local little league teams will be selling “sponsorship ads” in their programs, so promote the fact that you’re a community bank and there to support them.

April: As we close in on April 15^th, you can run your IRA ads a few more times to get those last minute filers. People are also starting to think about vacations, so you could begin promoting your Travel Clubs.

May: Many high schools and colleges will be holding graduations, so promote the fact that wherever these graduates go in the future, you’ll be there to help. Also this month, since people will be traveling more, it’s a great time to promote car loans. Many people are also thinking about remodeling their home, so promoting home equity loans could be profitable.

June: As kids get out of school, many families go on vacation. Credit cards and debit cards are extremely popular this time of year.

July: As the country celebrates the nation’s birthday, it’s a great time to talk about being a community bank or credit union that supports the local community. Plan a Customer Appreciation Day with a bar-b-que and invite the whole town!

August: As parents begin sending their kids back to school or college, it’s a great time to promote education loans. The local high school will also be selling sponsorship ads in its football programs, so personalize your message for that specific school.

September: Christmas seems to get earlier and earlier each year and September is a great time to start promoting your Christmas Savings Plans.

October: Since Roth IRAs have to be done by the end of the year, October is a great time to begin advertising these. You can also start promoting Health Savings Accounts, since many people will be researching them before the end of the year.

November: Car dealers start promoting their end of year deals – a great time to promote car loans!

December: Take time to say, “Thank You” to all of your loyal customers. It’s also a great time to remind everyone that you are a community bank. Their money stays in their community and any loan decisions are made by people who know them.

Put these dates on your calendar today and get started. You’ll be surprised what a little planning can do!…

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Neal Reynolds has worked with hundreds of banks and credit unions around the country helping them to grow core deposits and market share without growing their marketing budgets. Contact him at nreynolds@eadshop.com.

There is a great article in the latest edition of FastCompany.com titled Mobile Melee.

It describes the companies and industries that are fighting it out to turn smart phones into “wallets” and who could ultimately control the multi-trillion dollar U.S. payments industry.

The interesting thing about the article is that it predicts that banks will be the first ones out of the competition, even though they have millions of customers, existing merchant relationships and “dibs on most of our money.”

Nick Hollard, a mobile-tech analyst with the Yankee Group, explains, “They (banks) are risk-averse and they tend to be technology laggards…I can’t see them innovating here.”

The other problem I see is that most community banks don’t do a lot of marketing.

They’ll have to start getting more aggressive with their marketing or their “core deposits” will end up on millions of smart phones instead of in their banks.

Several merchants such as Chipotle and Starbucks have their own mobile-money app.

Chipotle has an iPhone app that allows users to order their favorite burrito and pay for it before even showing up at their local restaurant. Reports claim that over 600,000 of these apps have been downloaded.

The Starbucks app allows users to load cash onto their mobile phones, which then display a barcode that a baristas can scan at the register. The article says that merchants are too self-involved to lead the charge. They’ll probably just partner with a bigger player, much like they do with the credit card companies now.

Credit card companies are a major threat since merchants already tout thousands of Visa payWave and MasterCard PayPass terminals. This gives them an advantage if the mobile – payments standard becomes tap-to-pay. American Express launched Serve this year, a mobile platform that lets users send and store money – without funneling it through banks. (Community banks, please read that last sentence again.)

American Express, MasterCard, Discover and Visa recently joined a mobile – money venture, Isis™, which was formed by AT&T, T-Mobile and Verizon. They are claiming that the Isis mobile wallet will eliminate the need to carry cash, credit and debit cards, reward cards, coupons, tickets and transit passes, fundamentally changing how we shop, pay and save.

The mobile carriers like AT&T, T-Mobile, Verizon and Sprint are experts at processing payments, especially billions of cell-phone charges. While AT&T, T-Mobile and Verizon teamed up to create Isis with the top credit card companies, Sprint linked up with Google several months ago. The problem with the mobile carriers leading the charge is that they are not known for major innovation.

David Evans, founder of the tech consultancy Market Platform Dynamics says, “Just because there are partnerships doesn’t mean there’s anything real there.”

The leading digital payments platform PayPal, which claims 100 million users, could be a major contender. They processed $3 billion worth of mobile transactions in 2011 and have a suite of very useful smart phone apps.

My 25 year-old son and all of his friends use PayPal on their iPhones on a daily basis. PayPal also has a Facebook Connect-like feature called PayPal Access that aims to streamline the entire virtual-payments process. And it’s working on a cloud-based NFC (Near Field Communications) alternative that will allow customers to pay for products by using their phones to scan bar codes or by entering their mobile number and a PIN at existing payment terminals.

The problem with PayPal is that their ambitions require strong relationships with physical retailers, which has not yet been a top priority for them. This late start could put them at a slight disadvantage.

The tech titans are the predicted winners of this fierce competition. Right now Google and Apple are leading the charge, even though Amazon with its $34 billion online retail operation and Facebook with its 800 million users could easily make a sneak attack.

Google and Apple both have plenty of assets (in addition to plenty of cash). These include great relationships with consumers, more pull with physical retailers than PayPal, an active culture of innovation, and because they both outfit market-leading smart phones, control over when NFC chips could become standard.

There’s still more work to be done but most analysts agree that Google Wallet – with its sleek interface, ad-based business model, and rising adoption rate – is a big, bold step in the right direction.

My recommendation to financial institutions is to learn as much about this technology as possible and maybe even promote that you can show your customers how to take advantage of this new banking innovation.

Maybe even create your own version of a “Geek Squad.” You want to be perceived as the expert in all banking-related products and services. Be thinking about how you can use all of this new mobile payment technology to your advantage. I would love to hear your thoughts….

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Neal Reynolds has worked with hundreds of banks and credit unions around the country helping them to grow core deposits and market share without growing their marketing budgets. Contact him at nreynolds@eadshop.com.

New banking regulations, reduced loan volume and intense competition are causing banks all over the country to search for ways to cut overhead.

FDIC data shows that small banks as a group are less efficient than the larger ones. In the most recent quarter, 76 cents of every $1 in revenue at banks with less than $100 million in assets was used to cover expenses. At the larger banks, expenses only consumed 58 cents – and this gap has been growing over the last several years.

But how can small community banks cut expenses in order to remain profitable without losing that “hometown personal service” that has been the mantra of community banks for many years?

Sooner than later, these community banks will have to do something they have never had to do before – they’re going to have to aggressively market, advertise and sell their products and services. They’ll have to concentrate on growing their revenue instead of just cutting expenses.

But before calling the local newspaper and running an ad promoting “local decision making” or “free checking,” banks need to think about what products and services they want to promote, who they want to target, and which customers are going to be profitable and which ones are not.

Here are some tips and ideas for community banks to think about that will help them in their marketing efforts:

Know what makes you unique.
What is it about your financial institution that makes you stand out? Do you have more branches, which could make it more convenient for potential customers, or do you offer mobile banking, which could be attractive to the younger generation? Maybe you offer Remote Deposit Capture, which many retailers, churches and apartment managers could use. Identify what makes you unique and differentiates you from the competition.

Know what products and services you are offering and why.
Which products are more profitable or easier to sell? Which ones have the greatest potential to increase business/profits in the future?

Identify who you want to target and why.
Who is your real target customer? Are you after small businesses, large businesses, high net-worth individuals, or do you want to be a one-stop shop for everyone? The “why” is just as important as the “who.” Ask yourself: do you really want to target the family of four that keeps a $43.50 balance in their checking account each month or the doctor’s office who keeps $25,000?

Understand your competition.
Do you really know who your competition is? Once you know who you are competing with, find out what these other banks and credit unions are offering. They might be advertising a 1% CD but adding an extra 50 basis points when the customer walks in. Do they offer free ATM usage? One way to find out is to use a “mystery shopper.” Local college students are great resources for this. You can find out a lot of information for a very reasonable cost.

Get a sales plan.
That’s right, a sales plan! Who is going to leave your building tomorrow to go out to retailers offering your remote capture services? If your sales team has never made sales calls, they will need training.

Create a referral program.
Put together a referral program for all bank employees and make it fun. Each Friday, you can list the winners and give away cash. (Everyone likes cash!) When a customer comes into the bank to open a new checking account, for example, reward employees for cross-selling additional products and services.

Know your targets.
Develop a list of what businesses you want to target, complete with their addresses, phone numbers and e-mail addresses.

Monitor sales activities.
Have a process in pace to monitor sales activities. Know who your sales team has called and who they have visited. Did they leave a message or speak to someone? Did they e-mail them or pick up the phone and call them?

Pull existing marketing materials and see if they need updating.
When was the last time you updated your marketing collateral? Companies like BankMarketingCenter.com offer affordable tools to help you design any marketing piece your bank will ever need. You can even personalize marketing materials with a potential customer’s name, logo or photo – all within seconds.

Update your website.
Make sure your website is up-to-date and easy for customers to use.

Turn your TVs into bulletin boards.
Stop promoting CNN or Fox on your widescreen TV’s in your branches.
Companies like WifiSignage.com offer a very affordable solution that can turn your TVs into “community event calendars.” You can produce your own messages and ads and have them playing on your TVs in seconds for less than what you’re currently paying for cable.

Make it easy for customers to do business with you.
Develop a “switch kit” or offer a “switch coach” to help customers easily move their accounts to your bank. It might seem easy for you, but many people and businesses will pay higher bank fees to your competitor rather than go to the trouble to switch to your bank – especially if they are already using online bill pay and remote deposit capture. (That’s why you want to be selling online bill pay and remote deposit capture!)

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Neal Reynolds has worked with hundreds of banks and credit unions around the country helping them to grow core deposits and market share without growing their marketing budgets. Contact him at nreynolds@eadshop.com.

If you’ve heard it once, you’ve heard it a million times: mobile banking is going to change the banking industry. Sure, it won’t be overnight. But from all of the research I’ve seen, it won’t take long.

I recently spoke at a Jack Henry Banking Educational Conference, where I held up my iphone and asked everyone what it was. As you can image, they all answered, “a phone.” I then let them in on a big secret. What I was really holding up was a bank branch.

A bank branch that I, the user, paid for and not the bank!

Think about it. As a banker, how would you like to have a bank branch that your customer pays for and spends 24 hours a day with? You don’t have to pay for a building, vault, coffee, cookies, pens, paper or people. And every purchase they make, you are right there with them.

Does this sound like a dream come true?

But the real question is this: Whose bank branch will it be? Will it be yours or your competitor’s? Will it even belong to a bank? Maybe it will belong to a telephone company, internet company, or even an insurance company.

I can’t tell you exactly where the market is going, but I can guarantee you one thing: Unless you start offering mobile banking now and learn how to effectively market it, it won’t be your bank in your customers’ pockets.

People are creatures of habit. Once they begin using mobile banking from one company, it will be hard to get them to switch. So instead of spending millions on bank branches, invest a little in mobile banking. Recruit a young marketing person who lives on a mobile device – someone who can show you the future.

According to comScore, Inc., some 32.5 million Americans accessed mobile banking information on their devices at the end of June, representing 13.9% of all mobile users. The study also revealed that 12.7 million mobile users used banking apps, a notable increase of 45% from the end of 2010.

An analysis of credit card customers’ engagement with various account channels shows users reporting more frequent access through mobile channels than fixed-line computers, with 62% of credit card customers using an app to visit a bank’s website at least once a week. Another 52% percent reported checking-in with the same frequency via a mobile browser.

In comparison, only 34% of users checked-in to their accounts with the same frequency from a fixed-line computer.

“While mobile channels have not reached the same penetration that traditional online channels have for the use of financial services, it is interesting to note that mobile users access their credit card accounts on a more frequent basis,” says Sarah Lenart, comScore vice-president for marketing solutions. “As users continue to incorporate the use of these devices into their everyday lives, financial services institutions can expect to see a more engaged audience grow from their mobile channels.”

One of the many features on mobile phones includes SMS messaging or “texting.” Since this messaging is immediate, banks could use it to alert customers that they have a low balance and could experience an overdraft or that there has been suspicious activity on their account. Your bank could also promote a new higher rate CD or money market account for FREE!

With GPS technology on many mobile phones, retailers can alert customers that they are near one of their retail locations and offer a special promotion that allows the customer to place an order and pay for it instantly. (Hopefully, they’ll pay for it using your bank’s mobile banking application!)

Let me know how your bank is approaching mobile banking. How are you marketing it? What is your strategy?…

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Neal Reynolds has worked with hundreds of banks and credit unions around the country helping them to grow core deposits and market share without growing their marketing budgets. Contact him at nreynolds@eadshop.com.