Ten Things Directors Need to Know About Bank Marketing

As a board chair who just concluded an annual organizational meeting piggybacked on a regular monthly bank board meeting, you do not have to convince me that banks don’t need to go looking for items to fill their agendas.

That said, I am a financial marketer by trade, and I suggest you add this topic to one of your 2023 agendas: What Directors Need to Know about Bank Marketing. It will help you understand the “why” behind the “what” as it relates to your bank’s advertising campaigns and promotions and will help you ask smarter questions about marketing strategies and success. Until you have that discussion, here are 10 things I want you to think about:

1. Marketing can’t afford marketing to be a cost center. It must be a value center

   The old “marketing is an expense” mindset is archaic. If you can’t achieve measurable results e.g., more deposits, higher net promoter score, more services per customer with an initiative, don’t do it.

2. Marketing only exists to serve KPIs

   From donations to branding, shake off historical, soft messaging such as “We’re the Friendly Bank”. It doesn’t serve your organization anymore because everyone is the friendly bank. Make marketing bring home the bacon by focusing on helpful, specific product features or distinctive benefits of banking with you

3. Give marketing something to sell

   I can’t tell you how many times we’ve been asked to market a product that’s the equivalent of a Ford Edsel. Marketing isn’t magic. It can’t make people buy something obsolete, technically inferior, or poorly priced. If your products aren’t up to speed, marketing can’t compensate for that.

4. Listen to Raj Gupta, not the bank down the street

   The concept and value of thinking “outside in” comes from Raj Gupta, a multiple-time Fortune 500 CEO who cautions companies about taking a singular focus on incremental improvements of current product-based goals. Gupta contends that by constantly looking inward you risk missing market shifts that can render your product too limiting and/or too expensive, or both. Think about delivering what your customers want, not just the product you’ve always offered. It makes sense. Try it.

5. Beware the incumbency dilemma

   Many banks are putting their relevance and sustainability at risk because their customer base is stable. Don’t kid yourself. And don’t confuse inertia with loyalty. Remember, 3M developed post-it notes, making their Scotch Tape line of business lose market share. But they made a fortune in those little sticky notes everyone loves. If you need to change, change.

6. Data is the new QB for marketing, not personal bias

   As we get older, we tend to be more brittle in accepting information that we don’t agree with. (I can say this because I am really, really old!) Stop believing you know more than the facts. Gather data. Pay attention to it. You’ll get concrete results if you do.

7. Remember, you are NOT always the target

   As a director, you want to add your 2 cents’ worth on your bank’s marketing efforts. But remember, if the product and messaging aren’t designed for you, don’t pass judgment on it.

8. Consider the Amazon effect

   Your bank’s customers can buy what they want in seconds and get it in hours. Spending money marketing a product that carries with it tired processes and wait-in-line service will test their patience and is not a risk worth taking. If you have delivery issues, fix them. Then promote them.

9. Redefine your peer groups

   I see a lot of peer group information. It’s very helpful in many areas. But when it comes to marketing, you can’t just compare apples to apples. The financial space is full of oranges, those pesky Fintechs and Neobanks like Chime, who are competing fiercely for your retail and small business customers. Stay informed of their products, messages, and communication channels, because you need to know what you’re up against.

10. Marketing matters

    To be successful today, community banks need to keep the customers they have and grow the relationships of those customers. You also need to improve your efficiency. Targeted, strategically focused marketing can help deliver both. A satisfied customer will do more business with you. A customer who already likes you requires less marketing effort to make the sale. I know, you’re busy. Your agenda is full. But I invite you to give marketing a time slot in your 2023 calendars so you can see if it’s working as productively for your bank as it should be – and needs to be.

Becki Drahota is the CEO of Mills Marketing

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