Is bank marketing adding up?

Is bank marketing adding up?

“The marketing department at a typical bank spends seven times more on donations and community sponsorships than it does on marketing in digital channels,” says Sam Kilmer, Senior Director at Cornerstone Advisors. “It’s hard to transform your financial institution with this type of budget mix.”

Banks may feel an obligation to support the communities around them, and they should, but is that strategic, does it reach enough people, and does it address the competition?

Strategy
Community support is well and good, but exactly how is it supporting business goals? Has your bank narrowed the focus of its giving to a targeted subject that improves the business environment? Having a central focus, like education, means that financial institutions don't disperse donations into a large number of small efforts with untrackable results. As for the idea of community, where is a bank's community if more and more of its customers only interact with it online? Or, they bank with an all-online bank?

Reach
Typically banks do a terrible job of leveraging the support it does give. Most donations go completely unnoticed by the community at large. Opportunities to involve employees and other community members often are missed. Management of messaging, and its reach, takes a sustained effort.

Competition
Increasingly, a local bank's competition isn't the other bank or credit union down the street: it's the online bank, or the non-bank payment system. Electronic and non-bank offerings are proliferating, and people are trusting them and enjoying them. The category of financial services is a low-interest one; the institution that understands changing needs and meets them will have the advantage. That may not include sponsorship of the local soccer team.

Source of Quote: The Financial Brand

Kim Phillips is a marketing professional with 35 years of experience in communications for financial services, nonprofit, and for-profit businesses of all sizes.

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Bill Coleman

VP - Treasury Management Sales and Support Manager at Wilson Bank & Trust

9y

Well said Kim!!

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