As digital banking has matured, consumer behavior has shifted substantially. People now interact with their financial institutions through digital channels far more than through any other touchpoint. As the way people come to their bank or credit union evolves, how financial institutions market to their accountholders must also change – or they risk losing touch with what consumers want.
The answer is not to double down on old-school "spray and pray" marketing that's neither targeted nor actionable. Impersonal promotions can degrade the service channel experience. A better strategy is to use an artificial intelligence (AI)-powered platform that combines stored accountholder data with individual needs and preferences gleaned from short interviews in digital channels. As these platforms utilize machine learning to gain insight from stored data and quick digital conversations, they become smarter and more effective over time.
Once an AI-powered marketing system is in place, your organization can develop clear strategies for deepening existing relationships and expanding your customer or member base.
Before focusing on account acquisition, financial institutions should ensure they're doing their best to retain existing relationships. How does that happen?
Benchmark your base. Where do you stand with your accountholders? You can't keep or deepen relationships with consumers who won't recommend your institution. If your satisfaction and referral scores are comparatively low, you'll need to address any major issues that surface before launching a big cross-sell campaign. Benchmarking data, including the Net Promoter® Score, provides a framework to strategically focus on top growth opportunities and challenges.
Understand consumers' needs and objections. For example, if you want to know about upcoming major life events or why an accountholder doesn't use more digital services, stop guessing and start asking. Quick micro interviews can help you quickly learn more about consumers. When they log in to mobile or online banking, a marketing platform with machine learning functionality can identify whether they qualify for a two- to three-question interview that identifies potential objections and leads to a tailored offer. Response data, both positive and negative, is generated from the 20 percent of a financial institution's digital base who typically interview monthly and used to train the machine learning systems to ask better questions the next time.
Avoid the creep factor. A financial institution knows a lot about its accountholders, including spending habits, account balances and transaction data. If you blatantly use that data for sales – even if it's correctly targeted – you can erode consumer trust. For example, if a consumer who has just aggregated a Chase credit card account with your personal financial management system suddenly sees a credit card balance transfer offer promoting rates "lower than Chase," the offer can feel intrusive. However, when consumers volunteer answers to increasingly intelligent and relevant questions about their financial needs in a quick digital interview, the interaction feels authentic and relevant offers may be more welcome.
Don't turn service channels into billboards. Remember that online and mobile banking are service channels where consumers manage important financial business. Irrelevant or poorly timed advertising may degrade the experience or drive consumers to find another financial institution to meet their needs.
Financial institutions sometimes spread their marketing dollars pretty thin trying to attract new accounts. How can organizations focus on acquisition while saving on related spending?
Leverage brand promoters. One of the best ways to acquire new accounts is through word of mouth. Brand ambassadors – those who give a nine or 10 out of 10 when asked how likely they are to refer your institution to a friend, family member or colleague – are the most likely to make those referrals. Identify your brand ambassadors, ask them for a referral and reward them well when the referral comes through.
Focus on what works. Ask your new accountholders how they found you: Referral? Internet search? Drove past a branch? Set up targeted interviews for new customers or members when they log in or out of digital channels. Once you know what has succeeded, you'll have a good idea where to point your acquisition dollars in the future.
Effective digital marketing is about delivering the right content to the right person in the right context – and at the right time. Financial institutions can speculate about consumer needs, or they can use AI-powered systems to learn about personal preferences to serve people better. In this brave new digital world, financial institutions that leverage technology to outlearn and outservice the competition position themselves on top.