The 2018 Guide to Financial Marketing report, sponsored by DeLuxe, showed that, compared with other industries, retail banking is trailing behind what the others are doing with regard to the application of advanced marketing technologies.
The lagging behind has a negative impact on both the bank´s ROI from their investment in marketing campaigns and on their customers´ level of satisfaction in the same, at a time when advanced analytical tools and modern marketing platforms are becoming increasingly more adaptive and accessible. Part of the reason for smaller banks not wishing or intending to promote digital channels could be because many of these smaller institutions lag behind in digital product development.
In 2018, the focus of the larger banks continues to be all about digital channels, with large and regional banks making the adoption of digital channels a top priority. Unless the smaller banks are prepared to prioritize digital channels, the ability to acquire and retain an increasingly digital-savvy consumer base will become more and more difficult. The original fears and predictions, that e-marketing would wipe out high-street banks, eliminate jobs, has not happened – yet. Online banking has actually made the customer more central to the process, contrary to the original fears.
The Digital Banking Report of March 2016 established that consumers of all ages now expect digitalized, personalized online banking services which know them, understand them and provide them with what they want. Millennials, inevitably, are who most use digital services, 43,6% at least weekly. They expect most in personalization and are most likely to change providers, to attach to the fintech startups etc.
A number are retailers like Target, Amazon and others, have been showing the way. They are now leap-frogging through to the next stage of e-commerce by thinking beyond current practice. Target was in poor condition for five years after the 2008 financial crash and, for a while, the future of the retail giant looked uncertain. According to a Harvard Business School article, Target realised the potential of all the data it managed about its customers and, despite the downturn in its fortunes, invested a great deal of time, energy and money, to gather
more personalized customer data from multiple channels, and make more detailed analytics, going far beyond what other retailers were doing. By leap-frogging over what other retailers were doing, by collecting and analyzing more than what others were collating, by synthesizing that data, by adapting its approach to the signals found in that data, Target achieved the innovations it needed to survive and grow.
Target showed that getting ahead of the digital marketing curve is not a one-time effort or investment, that each new innovation application requires marketing staff to update their skills, not once but on a constant basis.
Whilst each innovation technology allows a closer relationship with the customer, usually in less time, and for less cost, these new relationships open up the need to incorporate the personalized preferences and needs of new customers into the marketing program. Marketing performance has to be measured on a constant basis, using marketing progress management elements. This requires revolving flexibility, a cybernetic adjustment on a continuous basis to all the factors involved.
The end goal in acquiring and applying automation technology is to improve revenues. Success is no longer about having the greatest number of retail outlets or a household name. It is about constantly evolving since the technology itself is constantly improving and innovating. Target showed that hiring the best and prioritising automation technology, even when it was itself in the doldrums, is the necessary way forward.
In our last webinar we presented tips and best practices to reach the Millennials & generation Z users in banking.
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