Banking processes were turned upside down with COVID-19. Most notably, the shift to digitalization accelerated exponentially. One thing that hasn’t changed, however, is that customers have evolving needs, and banks must respond accordingly. After all, this was the case when banks first opened in the late 1700s, and customers still want to access their money with ease and receive highly personalized service from trusted institutions.
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Things are changing daily — and the need to respond to and mitigate risk will continue to evolve into the next year and beyond. Marketers must consider how they can provide the most relevant and meaningful value to customers during this time. To do so, they need to step back and experiment with new ways to leverage the tools and strategies they use daily, all while still prioritizing security and ensuring that customers have access to much-needed services.
Contrary to what most marketers might think, the solution isn’t to go solely digital. It’s to meet customers where they are.
Meeting All Customers' Banking Needs
When modifying sales messaging based on customers’ and prospects’ preferences, one might see a need to assure customers in exactly the same way. Today, the first instinct is to ramp up digital communications and flood customers with email, online, and social media messages.
However, this method ignores segments of the banking population that don’t leverage those channels as primary sources of information and financial security. The reality is that there are demographics that need in-person touchpoints — or a blend of digital and in-person ones — to better understand their finances. Some transactions and maintenance activities just can’t be done online, no matter how advanced your app and website are. For example, relationship-based activities (such as new loan discussions and cash management adjustments) are more challenging to conduct remotely due to KYC and BSA protocols.
Furthermore, younger demographics might prefer to make withdrawals and pay bills at physical banks. According to Adobe Analytics, more than 70% of Generation Z customers visit physical banks at least once a month — the highest number of any generational group. In addition, respondents spanning every demographic said that physical locations are an important part of banking. Yet for expense reduction and digital performance issues, branch consolidation continues.
There’s no time like the present for financial institutions to use the wealth of information at their disposal to better serve customers. Bank marketers can use these insights to demonstrate that they know how to overcome in-person scheduling challenges, limited drive-thru access, and digital capabilities to still maintain a high quality of service in any situation.
Staying in Touch Through Continued Uncertainty
People frequent physical banks not only for basic financial tasks, but also to get advice and peace of mind. So how do marketers balance the need for in-person services, digital communication, and customer safety? Here are three strategies to keep in mind:
Don’t Rely On Digital Communication Alone
Because of the pandemic, many marketers have defaulted to the fastest channels (in this case, digital). However, those only scratch the surface of communication. During times such as these, banks need to exhaust all communication options with customers using digital and nondigital means aligned with their profiles — not based on how much marketers want to communicate with them. Part of the issue stems from the fact that digital communication is based on banks’ capabilities, and not necessarily how customers obtain information.
Case in point: As mentioned, many customer segments still visit branches. However, I’ve recently seen many senior customers visit branches after COVID-19 restrictions were lifted, just to find that they only accept visitors via appointment or operate at different hours. Some banks are constantly changing their in-person strategies without effective notification. Nondigital communication (think postcards advertising new hours or phone outreach) could have prevented these customers from making unnecessary trips.
At a minimum, customers don’t expect their financial institution to go quiet, but it can feel that way if bank marketers don’t tailor communication to specific needs across channels. Besides this, most banks’ social media followers don’t outnumber their in-person customers, meaning relying on that channel alone won’t show the majority of your customers that you understand their needs.
Focus On Credibility To Provide Lasting Value
This is not as much a time for differentiation, but rather for credibility. Marketers who use uncertain situations customers are facing (think small business financing, student loan debt repayment, and more) as a way to take prospects from competitors might be missing the bigger picture of what customers actually need. This, unfortunately, is not a short-term issue. Many banks are struggling to find growth, even more than they did during the height of the pandemic, and need to figure out how to engage customers into 2022.
As a solution, marketers should focus on how customers behave, the channels they use, and what they need. Crisis-management communication requires banks to anticipate and monitor what information customers need and then configure their inbound networks to direct those inquiries toward someone who can help.
However, banks and customers are often on a similar learning curve when it comes to issues and solutions. This reality requires nimble resource allocation and real-time training and education processes from management to the front lines.
Huntington Bank provides a great example. The Ohio-based institution recognized the need to shift control of overdraft charges into the hands of customers. Therefore, Huntington Bank announced that if you withdraw more than your account holds and incur an overdraft fee, you have until the following day to get it waived. By contrast, most banks charge the fee overnight — a move that appears to be getting attention across the country. This benefit became the basis of one of the company’s multichannel marketing campaigns. Huntington Bank showed its customers that it was there to help save them the stress of contesting overdraft charges during an already stressful time. The bank also successfully branded this offering as “24-Hour Grace.” As a result, the bank saw nondigital consumer checking accounts for new households grow from 48% to 66% between the second and third quarters of 2020, all while active digital users grew by 7% year over year. All in all, this strategy is key at a time when certain benefits (like overdraft grace) are more important than ever.
Use Everyday Tools To Update Customers
Through this continued uncertainty, banks can’t lose focus on existing customers and their specific financial needs. To do this, marketers need the right tools and (both digital and nondigital) messages to keep customers informed of changes and issues that affect their finances.
Many banks, like New Jersey’s Investors Bank, have developed effective cadences of social media messaging to showcase solutions built to assist customers. At the same time, they highlight diversity, equity, and inclusion initiatives to align with what customers need and might find important. Another bank that has practiced this approach is Boston’s Eastern Bank, which offers a free charitable account to all existing customers, allowing them to donate to their favorite causes and charities without fees. This offering also makes it simple to keep track of tax receipts to aid in filing during tax season.
Beyond this, now is the time to continue practicing candor around new processes required to handle the reality customers face, from new loans to credit extensions, overdraft policies, and beyond. Ensure that customers know what they can do with their finances and how they can count on your bank to help with financial issues.
Processes continue to be anything but normal, but your customers still expect — and need — to receive your services. These unprecedented times require you to use every communication resource at your disposal to reach all of your customers. Show customers that you know them to gain their trust and guide them through the coming year.
About the Author
Rick Hall is the managing director of the Banking and Financial Services practice at BKM Marketing, a boutique marketing communications and strategy firm based in the Boston area with a deep focus on the financial services industry.