43 Retail Banking Myths

CROWDSOURCING SERIES

With the financial services industry changing so quickly, it should come as no surprise that many assumptions banks and credit unions believed to be true for years could actually be rendered obsolete. To uncover retail banking myths and provide new realities, I reached out to more than 40 global financial services leaders including bankers, credit union executives, industry analysts, advisors, publishers and editors, bloggers and fintech followers and got 43 myths.

Myth 1. Banks must embrace big data to be successful
Reality: Most banks and credit unions have not fully leveraged insight that is currently available within their firewalls. Account ownership, demographics, product use and other behavior data should be used for offers and communication before adding unstructured data from outside the organization.
Data analyst from $20 billion bank

Myth 2. The majority of consumers prefer to open "important" accounts in the branch.
Reality: When deciding what channel to use, consumers weigh a number of factors (eg. reliability, speed, safety, convenience, time of day, cost, previous experience, brand perceptions, etc. etc.)
Jim Bruene, Editor & Founder The Finovate Group | Online Banking Report | Netbanker blog

Myth 3. New market entrant competition is limited to deposits and payments but lending is safe.
Reality: Over the past five years, emerging Online and Independent lenders, many of whom did not exist during the depths of the Credit Crisis, have stolen 10% market share away from primarily the midsize / regional banks in the US.
Wayne Busch, managing director of Accenture's North America Banking practice

Myth 4. The branch is dead. 
Reality: It's not even on life support. There is a place for a brick and mortar experience albeit with fewer bricks and less mortar. We need to rethink the branch model and experience, but bankers will be offering a strong physical (and digital) presence for decades to come.
Bryan Clagett, CMO, Geezeo

Myth 5. We need to excel in omnichannel banking
Reality: There is no such thing as a channel. Our objective should be to ensure a consistent digital approach across the whole customer engagement without thinking about channels. Channels should be considered as digital platforms that provide customer touchpoints.
Chris Skinner, Chairman, The Financial Services Club 

Myth 6. Boomers like the touch of paper.
Reality: While this was true in the past, it is now a myth based on recent research from Celent.
Bob Meara 
Senior Analyst, Banking Group, Celent 

Myth 7. If you don't cross-sell a new customer within the first three months of the relationship, you've lost the chance to cross-sell.
Reality: It is better to focus on engagement (go with) services in the early days of a relationship, but selling additional products is best done later in the relationship when more is known about customer activity, product use, financial goals, etc.
Ron Shevlin, Senior Analyst, Aite Group

Myth 8. Bankers need to at least sell 6+ (or 10+) products to customers to remain profitable.
Reality: More products doesn't mean guaranteed profitability or engagement. More importantly, the focus should be on customer needs and an improved experience as opposed to the bank or credit union's goals of 'more products sold'.
Deva Annamalai, Bank Marketing Technologist, Salt Lake City

Myth 9. Customers are not willing to pay for mobile remote deposit capture.
Reality: Several banks have started to charge for this service without impact to their adoption/usage targets.
Matthew Wilcox, 
Managing Director of 
Marketing Strategy and Innovation, Digital Payment Solutions
, Fiserv

Myth 10. To purchase a complex banking product, the face to face relationship with an expert is irreplaceable.
Reality: The same was said for selling shoes. 
However, this does not mean you will not need any more experts, in combining face to face rendez-vous and remote access or to describe the rules of artificial intelligence software.
Raphael Krivine, 
Director AXA BANQUE

Bank Innovation Through Collaboration

INNOVATION 

Established by two former bankers, the Bank Innovators Council was developed to help financial institutions that may lack internal resources come together to brainstorm and test new ideas that could eventually be shared. Partnerships with Finovate, NextBank, BankersHub and Innovation Agency will hopefully provide additional momentum. 

By JP Nicols^®, founder and CEO of the research and innovation firm Clientific, a partner at Bank Solutions Group and co-founder of the Bank Innovators Council.

Bankers and credit union executives have long sought a competitive advantage in a vast sea of largely undifferentiated competitors. For most players, and for most of the industry’s long history, the chief weapons in this war have been scale and localization. Either growing large enough to create economies of scale and/or scope, or trying to corner one or more local markets by being more, well, “local”. A few have even tried to accomplish both strategies simultaneously.


But how will those strategies play out in this new era of financial services? Regulators will not let the very biggest banks get a whole lot bigger any time soon. The top 100 banks in the U.S.— less than 1.5% of the 7,000 or so still around— already control 81% of the loans and 75% of the deposits. Well-capitalized and well-run small and midsize banks and credit unions will certainly swallow up weaker competitors as this quickening consolidation phase that we have all been predicting inevitably becomes a reality sooner or later. But will this truly create any new competitive advantages beyond survival of the (relatively) fittest?

How about the localization strategy of being 'the bank or credit union of '? Let’s set aside the fact that most organizations that proclaimed to be the bank of XYZ were probably not really the bank or credit union of anything outside of their own imagination. In this hyper-connected, hyper-globalized world, being merely local is meaningful to only a steadily dwindled segment of consumers. 

Sure, there are kernels of truth to each of these strategies. Having the scale to spread out increasing infrastructure costs is important, up to a point. And I chose the words 'merely local' for a reason. I think the real word the localists are looking for is 'relevant'. Being headquartered in my hometown is fine, I guess. More jobs for the local economy. But as a customer, what I really want is for you to be relevant to me — and many of the behaviors of the banking behemoths did little to make me feel that way.

Why It’s Different Now

Those basic strategies worked well enough for the last few hundred years, but until recently, the industry was basically undefeated because it won all of its games by default. Sure, we had large banks and small banks, and credit unions, and for a time, S&Ls and Savings Banks; but these were all just slightly different flavors of the same basic model.

Banking as a product and as a service had no real threat of substitution. But during just the last 5 to 10 years, the proliferation of smartphones, tablets, broadband connectivity and connected networks of all kinds have changed the nature of the game. Forever. Just as radio and movie theaters were disrupted by television, which was disrupted by videotapes, which were disrupted by DVDs, which were disrupted by streaming video, the disruption in banking has only just begun.


You can now live your entire financial life off the grid of traditional financial institutions — at least in your direct interactions. They still play a role behind the scenes, but the nameless, faceless utility that merely holds your insured deposits and ensures an efficient transfer of your funds from Point A to Point B is the very definition of a commodity trap.

Top 10 Retail Banking Strategy Posts of 2013

It has been an another amazing year for Bank Marketing Strategy in 2013. The blog was named a top financial industry blog for the second straight year by The Financial Brand and bank and credit union industry followers viewed articles more than 600,000 times during the year.

But which of my 72 posts in 2013 were the most popular? Based on readership, it looks like posts dealing with banking strategies, mobile banking, new competition, and distribution topped the list over the past twelve months. Readers also read my crowdsourcing posts in record number, where dozens of global industry leaders contributed their insights.

Below are this year's top 10 articles with links to each post.

Banking Leaders Predict Major 2013 Trends

Not surprisingly, the most read post during the past year was also one of the first posts of the year, where more than 50 financial industry leaders provided their insights and predictions for what they believed would occur during 2013.

Predictions included thoughts on payments, big data, delivery channels, marketing technology, product and segmentation opportunities, competition and compliance. Many of the contributions were spot on, while some were ahead of their time.

Interestingly, the 2014 Top 10 Retail Banking Trends and Prediction post published last week also is also a top 10 article for 2013.

Moven: From Mobile Banking to Mobile Money

Curiosity about new financial industry players like Moven, Simple, GoBank and new product introductions like Bluebird from American Express continued to generate a large number of readers in 2013.

While these mobile-first banks may have been ahead of their times a couple years ago, much of their vision of simplicity, an improved user experience and integrated personal financial management tools are quickly becoming table stakes in the battle for the mobile banking customer. This post illustrated how Moven continues to be one of the leaders in being able to leverage the power of the smartphone as a payment device with the ability to provide immediate feedback with every spending decision.

Banking Leaders Discuss 2014 Strategic Planning Priorities

To assist with bank and credit union strategic planning processes, I enlisted the help of more than 30 banking leaders from across the globe in July to provide thoughts on the priorities that should be considered in the upcoming year.

Despite responses coming from disparate locals, the recommendations were surprisingly consistent, with a focus on enhancing the customer experience, better defining mobile positioning, integrating delivery channels, reducing enterprise costs, leveraging data, improving sales and marketing effectiveness, defining a differentiation strategy and continuing to focus on revenue, security and compliance.

An Interview With Chris Skinner on Building a Digital Bank

It is becoming more and more difficult for traditional banks to compete in an increasingly digital marketplace. With most bank systems stuck in the last century, the conversion of legacy technologies to new platforms with total reliability, security and resilience is a massive challenge.


How can today's banks evolve to a new model of servicing and processing, where the mobile internet allows consumers to bank wherever and whenever they want using an increasing array of devices? How can banks leverage their existing foundation to compete with new and nimble mobile-first competitors?

I had a chance to speak to Chris Skinner recently about his perspective on the evolution of banking, the emergence of new competition, winning the mindshare of an increasingly connected consumer and on the release of his newest book, Digital Bank: Strategies to Succeed as a Digital Bank (available on Amazon for $9.99 for the Kindle version or $17.99 in paperback).

Best known as an independent commentator on banking and the financial markets through the Financial Services Club blog and Chair of the networking forum The Financial Services Club, Chis is the author of several previous books covering everything from emerging regulations to innovation and new currencies. He is also Chief Executive of Balatro Ltd, a research company and a regular commentator on BBC News, Sky News and Bloomberg on banking issues.

In reading an advance copy of Digital Bank, I found that Chris provides a great overview of the digital revolution in banking from channels to systems to emerging currencies. He also provides in-depth analysis of the how incumbent banks such as Barclays to new start-ups such as Metro Bank in the UK, Alior Bank in Poland and FIDOR Bank in Germany are building for a digital future.

As several noted fintech followers mention in online reviews of this book, Digital Bank is the most recent must-have for anyone wanting to help their organization stay relevent in banking or for businesses wanting to better understand the impact of digitalization on the marketplace. 

What inspired you to write this newest book?

I've been blogging daily since the start of 2007 at the finanser.com. With the blog, I would write a series of four or five posts on a particular subject, like why branches were the wrong focus, how data is becoming the new banking battleground, why existing banks have challenges, what organizations are innovating in unique ways, etc. These posts were never edited or placed in any sequence, but provided a great foundation for potential chapters in a book. So, I finally got around to taking all of that experience and all those thoughts and personally editing them into a readable, digestible, logical book. 

What do you hope readers take away from your writing?

The overarching theme of Digital Bank is that banks are being fundamentally restructured and challenged by the Digital Age. From physical services through physical branches, we have rapidly become a business that provides digital products through digital relationships. That leap is not happening fast enough, however, as most banks are tied to their traditional operational, technological and physical structures. This book provides a roadmap to take that old bank into the new world, how it can be achieved, proof points as to why it is needed and lessons of what to do and not do. Anyone dealing with digital bank distribution through the mobile, social internet will find it useful.

Money2020 Attendees Share Insights and Takeaways at Bank of America Twitter Chat

On Wednesday, October 9 from 7:30 - 8:30 am, Bank of America hosted a twitter chat at Money2020. 

The live chat was designed to look back at the first few days of the conference, discussing important themes and takeaways, memorable moments, and issues facing the payments industry – essentially an opportunity to connect the dots.

The chat was aimed at conference attendees and people who weren’t able to attend, and was designed to focus on thought leadership around payments. Unlike most chats, this event had a live audience who participated on site along with others who participated in absentia. On the live panel moderated by Peter Osborne were Farhan Siddiqi from Bank of America, Cherian Abraham from Experian, David Birch from Consult Hyperion, consultant Tom Noyes, Elizabeth Dias from Perficient, Jim Issokson from MasterCard and myself (remotely).

The following transcript captures comments made during the Bank of America Money2020 Twitter chat. This transcript was edited to keep the answers to questions together. Retweets were also deleted that did not include additional content to shorten the transcript and show the flow of conversation. 

Metrics for the twitter chat were as follows: 

• Total Participants: 187 
• Total Number of Tweets: 711 
• Total Reach: 574,623 
• Total Impressions: 6,787,715 
• Total Number of Retweets: 318 

Bank of America @BofA_News: Welcome to the Future of Payments Innovation chat, live from #Money2020 in Las Vegas. #BofA_News is pleased to host this opportunity to connect the dots from the #Money2020 conference. My name is @peter_osborne and I’m a communications executive for #BofA. I’m joined by @FarhanSiddiqi, #BofA Strategic Planning Executive for Digital Banking.

Q1: What speakers or topics have most resonated so far at Money2020

Jim Marous @JimMarous: A1: Highlight - #Amazon #PayPal #Citi #AmEx #Discover #MasterCard rocked! Showed that payments innovation never sleeps. #Money2020

Elizabeth Dias @techmktggirl: A1: Standout #Money2020 Speakers: @thefriley of @Square & @PayPal. Topics: #TomorrowsBank, Consumerization of Data & Retail 3.0

Kevin Boglarsky @kmbx2ind: #money2020A1. The keynotes even if they went a bit long.

Thomas Noyes @noyesclt: A1: I thought amazon MCX and Amex did a fantastic job.

Bank Innovation @BankInnovation: I enjoyed the bullishness on Bitcoin and loved the Square and Amex keynotes. - Phil Ryan, Bank Innovation #money2020

Aaron McPherson @aaronmcpherson: A1: Tokens are BIG #money2020

Jim Marous @JimMarous: A1: Loved the tweets Monday "#Bitcoin will do to money, what the internet did for information" #Money2020

Bank of America @BofA_News: A1: Sarah Friar was impressive explaining Square’s lofty mission and its simple approach – Start-Run-Grow. ^fs #money2020

Dave Birch @dgwbirch: #money2020 A1: liked the Amex stuff about the unbanked, the Zapp direct to bank account retail proposition, new PayPal stuff

Monday at Money2020 in Tweets

Billed as the largest event focused on emerging payments and financial services, Money2020 has easily eclipsed its inaugural event in 2012, bringing together more than 4,000 fintech followers, including 300+ CEOs and more than 1,250 companies from 50 countries.

While not being able to attend this year, I was able to live vicariously through the tweets of others who captured the highlights (and some humor) from the first full day of the event. Below is a recap of today's sessions.

#money2020 has started. Read the blog of 3 questions to be asked in almost 60 sessions: http://t.co/X7JIS61Tx1’s
— Money2020 (@money2020) October 6, 2013

#money2020 "what happens in Vegas, gets tweeted from Vegas"
— Dave Birch (@dgwbirch) October 7, 2013

Money2020 looks to be an awesome event. Sold out, it looks like EVERYONE is here. @Wmagency #money2020
— William Mills (@williamemills) October 7, 2013

Omni-Channel Reality: "67% of consumers have started shopping on device but completed the purchase elsewhere" -Kevin Levitt #money2020
— comScore FinServ (@comScoreFS) October 7, 2013

$Mitk and Experian® Collaborate to Help Organizations Monetize the Mobile Channel http://t.co/cqFCNfizbu #money2020 #mobile #technews #tech
— Deppilf flippeD (@deppilf) October 7, 2013

From Scott Grimes: Adding mobile to a banking relationship adds 6 touchpoints per week #money2020
— Ryan Page (@helloryanpage) October 7, 2013

#money2020 MasterCard have already used my favourite statistic! US is a quarter the world's card volume but half the world's card fraud
— Dave Birch (@dgwbirch) October 7, 2013

State of Gift Cards this morning at #money2020. Here's what @rsrresearch says about the best digital gifting programs http://t.co/4lPzhfL5ko
— CashStar, Inc (@CashStar_Inc) October 7, 2013

Banking Leaders Discuss 2014 Strategic Planning Priorities

CROWDSOURCING SERIES

As we enter the planning season with a marginally better economy than last year, banks and credit unions are faced with margin compression, high operating expenses, new competitors and channel disruption that challenge even the most efficiently run organizations.

To assist with this year's strategic planning process, I asked some of the foremost global leaders in the banking and credit union industry to provide thoughts on what they believe are the 2014 strategic planning priorities. This blog post is a companion to the post done at the beginning of the year regarding trends expected in 2013.

Understanding that each financial institution and market is different, it was interesting the uniformity of priorities offered to bank and credit union management by the more than 30 industry leaders I interviewed for this post. And while the ability to execute against these strategic priorities may be impacted by size of organization and other dynamics, there was a consensus among those who I spoke with that 2014 may be one of the most important planning cycles ever.

Enhance the Customer Experience

Improving the customer experience was the foundation of almost all of the responses I received around 2014 strategic priorities. Whether we are talking about branch reconfiguration, mobile banking applications, back office operations, etc. banking industry leaders believe an improved customer experience is the key to growth. 

As was said by Mary Beth Sullivan and the team from Capital Performance Group in their May/June Newsletter, "Many banks have a long way to go to get the basics right, so banks and credit unions should focus first on the basics. Once the basics are humming, ask yourselves: What can we do to be sure that our customers are better off banking with us than with our competition? What will make our customers lives better? How can we help them solve specific problems they are dealing with? Answers to these questions will define the experience you seek to create."

Beyond 'the basics', other specific strategic initiatives were recommended by Steven J. Ramirez, CEO of Beyond the Arc. "Developing a proactive complain management process that goes beyond regulatory requirements can drive new customer experience projects", says Ramirez. He also believes financial institutions need to determine how they can be a finger swipe away from providing guidance and support through mobile devices.

Financial industry futurist and blogger Scott Bales believes bankers need to get out of the office and talk to real customers, developing empathy for their problems, behaviors and desires if they want to develop offerings that align with the needs of the market. According to Bales, "The goal is to build experiences, not products".

Sankar Krishnan from Sutherland Global sees customer experience as the 'X factor' across all channels and interactions the customer has with their financial institution. Comparing what banks need to strive for with customer experience leaders Apple, Amazon and Quicken Loans, Krishman believes banks need to excel at aligning people, process and technology. 

Sam Maule from Carlisle & Gallagher Consulting Group believes that recent start-upssuch as Moven and Simple (and perennial cx leader USAA) are the best at visual engagement and customer experience. He quoted one of his banking clients as saying, "I would pay $500K for ONE great user experience designer. FSI's are horrible at this. We have massive data systems, huge BI tools, and more, but none of that means jack for consumers if there isn't an amazing user experience."

Finally, best selling author and acclaimed management advisor Joe Pine believes banks and credit unions must go beyond providing just checking accounts and loans.

Are Some Banks Too Small to Survive?

With increasing regulatory capital requirements, declining interest margins, a greater need for investment in innovation and new competition, there are many in the industry who believe that smaller banks may have limited opportunity for growth in the future. 

These pressures may lead to an acceleration of consolidation in the banking industry that impacts both small and mid-tier banks and results in a significantly reduced number of institutions in the future.

While attending both the BAI Payments Connect and CBA Live conferences in Phoenix last month, discussions often revolved around the heavy financial and organizational impact of new capital requirements and of regulatory compliance being faced by institutions of all sizes. It was also clear that the investment in advanced technology and the pace of innovation was creating a distinction between the 'haves' and the 'have nots'. While there were some exceptions, this line of demarcation appeared to be defined by the size of organization.

The question I asked several industry thought leaders over the past couple weeks is whether smaller banks are in a position to survive given the massive industry changes on the horizon. While their responses varied regarding the chances of survival for today's community bank (and smaller credit union), there was unanimity in their belief that smaller institutions must quickly adjust to the 'new reality' of increased capital requirements and regulatory pressures, a greater focus on revenue, and a need to innovate for an enhanced customer experience.

"The thing that keeps me up at night is that we will likely see an industry contraction in the next decade like we never experienced", states Bradley Leimer, vice president of the $3.2 billion asset Mechanics Bank in California. We are moving from over 14,000 financial institutions today to less than 5,000 in the next 10 years (maybe sooner). This is due to the changing nature of consumer behavior with the introduction of mobile and social and technological innovation, but also due to systematic changes to the banking model itself."

Also supporting my informal findings, Emily McCormick, director of research and writer for Bank Director, interviewed the risk officer of an $8 billion bank holding company for Bank Director's 2013 Risk Practices Survey. He told her that, while he found a lot of positives in the regulations coming out of Washington, this could be a challenge for smaller banks that lack the resources and staffing to keep up.

McCormick also believes there's a technology challenge, "Internally, smaller banks need the right resources to do things like manage risk, but they also need the resources to compete. While smaller banks have the significant benefit of connections within their local business communities - giving these banks a potential advantage in business lending - customer expectations for services like mobile and online banking will continue to rise."

Moven: From Mobile Banking to Mobile Money

February is definitely a pivotal month for the start-up previously known as Movenbank, having changed it's name to Moven, winning the best of show honors at Finovate Europe and gearing up for a February 25 closed beta launch of its mobile-optimized financial services application. 

Founded by Bank 3.0 author Brett King, with $2.4 million in seed funding, Moven is the latest but not the last in a plethora of unique banking alternatives including Simple™, GoBank™ and Bluebird™.

So what sets Moven apart from not only traditional banking organizations, but also the less traditional financial intermediaries that are entering the banking battlefield? 

First of all, Moven is not a bank. Similar to Simple, while not having a banking charter, Moven provides a unique customer experience interface with a traditional banking organization working in the background (with banking licenses, FDIC insurance, etc.). The focus of Moven from the beginning of development has been to 'help customers spend, save and live smarter' using mobile technology.

According to Brett King, "With Moven, we're not talking about downsizing an Internet banking portal onto a mobile screen or downloading a debit card onto a mobile wallet. Instead, we are creating an entirely new way of thinking about a bank account, giving the customer mobile insight and control every time they make a decision that could impact their financial health."

The Art of Bank Innovation According to Guy Kawasaki

One of this year's keynote speakers at BAI's Retail Delivery Conference was Apple evangelist and innovation guru, Guy Kawasaki who is also the founder and CEO of Garage Technology Ventures. During his very engaging and at times irreverent presentation, Guy broke down the art of innovation into 10 easy -- and not so easy -- steps. He explained to the room full of bankers and industry service providers that while these steps should be followed, even he has not been able to always follow his own advice in his career.

1. Make Meaning - Great innovation occurs when a person/company decides to make the world a better place. Great companies are able to make meaning, and as a natural outgrowth, also make money. One of Guy's examples was Apple's development of innovative products that made the world more productive and creative. It was interesting for me to realize that most of the banks recognized in the Finacle/BAI Global Banking Innovation Awards this year developed products that actually improved the financial well being of their customers.

Banks Transforming Branch Networks to Improve Efficiencies

A lot has been written lately around the desire for banks to transform their branch networks given the consumer acceptance of alternative channels and the need to reduce distribution costs. In the past week, there has been coverage in both the American Banker as well as in BAI's Banking Strategies publication (see links to recent articles and white papers below).

One such report, published by the financial market research firm Fitch Ratings entitled, U.S. Banks: Rationalizing the Branch Network, expects that both fewer numbers of branches and different types of branches will be serving customers in the future. According to the report, the continuously increasing cost structure of banking, accompanied by a challenging revenue environment and higher capital requirements is prompting banks to evaluate all expense categories — especially their branch distribution system, which is one of the most significant expenses.

Past Branch Growth

For the past 30 years, branch growth continued unabated while the number of financial institutions declined by more than 50%. The growth occurred largely through consolidation and de-novo expansion, with the objective being to expand a bank's footprint and customer base and therefore low cost deposits and loans.

The Changing Definition of Convenience in Banking

Historically, one of the reasons people have chosen big banks has been their large network of branches and ATMs. Especially for people like myself, who travel across the country frequently, finding a place to conduct basic transactions without a fee was a competitive advantage for those institutions with a wide distribution network.

Recently, however, small institutions have been working on ways to erode this advantage, closing the gap through expanded ATM networks, improved online banking and now mobile banking services. In short, technology is quickly changing the definition of convenience for bank customers.

A recent study, The New Banking Value Proposition, from market research firm Chadwick Martin Bailey, finds that credit unions and smaller banks are maintaining their perception of having high levels of personalized service while also catching up with their larger competitors in terms of banking convenience. For those smaller institutions who are focusing on new technologies, this can allow them to more effectively compete for the increasing number of accounts in motion. Additional findings include:

Banks and Credit Unions Focusing on Onboarding to Build Revenues

There has never been so much pressure on financial institutions to maximize the revenue and relationship potential of each customer. With government regulations reducing fee income, historically narrow interest rate spreads, and consumer satisfaction with many financial institutions wavering, there's a need to ensure that once a customer opens a new account, every effort is made to help the customer understand and use their account, expand their relationship, and increase loyalty to your organization.

While time and resources have been dedicated to new customer acquisition processes in the past, a majority of financial institutions are now working to implement or improve the communication process right after account opening and for several months into the relationship. And instead of a single welcome letter (or nothing at all), more and more organizations are using a series of well-timed, personalized communications leveraging multiple channels to improve effectiveness.

According to the recently completed 2012 Financial Services Marketing Survey done in partnership with The Financial Brand, both banks and credit unions indicated that onboarding would be one of the most important strategies for the next 12-24 months, with virtually no institutions stating that the importance of onboarding would be less.

2012 Financial Services Marketing Survey

Banks and Credit Union Marketers Taking Different Paths in 2012

According to a Rand Corporation research study, consumers usually select a financial institution based on convenience of branches, convenience of ATMs and bank fees. While bank users were more likely to select based on convenience, credit union users more likely chose with a desire to avoid fees. Consumers also cite personalized service when selecting a credit union.


With this as a backdrop, it is interesting to study the divergence of opinions expressed by more than 300 financial marketers from larger banks, credit unions and community banks as part of the 2012 Bank and Credit Union Marketing Survey covered on January 17 on both The Bank Marketing Strategy blog and on The Financial Brand. 


Faced with many of the same environmental challenges of increased availability of data, a proliferation of delivery options, imminent changes in how payments are processed, new marketing communication channels and consumer sentiment that has at times been polarizing, there are significant differences in how bank and credit union marketers view their roles, challenges and opportunities. There are also differences in the channels different types of organizations will use to communicate in the next 12 months.

State of Bank and Credit Union Marketing 2012

Today's bank and credit union marketers are facing a period of big data, increasing devices and more communication channels than ever before. In addition, consumers are challenging the pricing and service levels they receive from their financial institution, and are willing to speak their mind using lightning fast social media channels.


To better understand what bank and credit union marketers are thinking and doing during this period of unprecedented change and opportunity, I partnered with Jeffry Pilcher from The Financial Brand to develop the 2012 Bank and Credit Union Financial Marketing Survey. More than 300 bankers responded from banks and credit unions of all sizes thanks in no small measure to our many friends on Twitter who helped distribute the links to the survey and to ACTON Marketing, who recruited many of their clients and friends.


The results of the survey underscore the primary challenges facing financial institution marketers today:

• The need for better measurement of marketing results during a time of constrained budgets and limited human resources.
• The importance of expanding share of wallet through cross-selling, especially with credit products
• Changing the media mix used for integrated customer communication - with a greater emphasis on less familiar online and social media channels

    View Entire Survey Results   

10 Resolutions Bank Marketers Can't Ignore in 2012

2011 was year that many bankers, and especially bank marketers would love to forget. Not only was focus diverted by the need to respond to new regulations for the second consecutive year (this time it was the Durbin Amendment), but the image of our entire industry was challenged as foreclosures and bank failures continued to be in the news. 

The biggest impact of all of this noise was that attention was diverted from what should have been accomplished in 2011. As I reviewed my post from last year, Ten Bank Marketer Resolutions for 2011, it is clear that most bank marketers lacked the time/focus to make much progress on any of last year's goals. 

So, in writing this year's Bank Marketer Resolution post, I could have simply posted the same resolutions from last year (similar to what I do with some of my personal resolutions). Instead, I reached out to bank industry leaders from across the globe for their ideas. There was surprising uniformity in their suggestions, and a sense of urgency around the need to achieve much more than last year.

So here are the resolutions bank marketers should not ignore in 2012 according to industry leaders:

1. Validate The Value of Marketing Through Measurement: As highlighted in my recent post 100 Years Later, Marketers Still Have Difficulty Measuring Up, there is still a tremendous gap between what bank marketers implement and what is measured. Not only are there almost 20% of marketers who don't find measurement of results imperative according to recent research by Ifbyphone, but less that 50% of any channel is measured. Dan Marks from First Tennessee says, "Bank marketers should resolve to measure and optimize true marketing ROI – having the courage to seek out the unproductive part of the marketing mix and replace it with other activities that generate real shareholder returns." Serge Milman, CEO of Optirate states, "In 2012, bank marketers should resolve to have a more diligent focus placed on business drivers that can help manage and grow the bank," while Bradley Leimer, vice president of online/mobile strategy at Mechanics Bank said that,  "The number one resolution for bank marketers in 2012 must be to 'put data first,' since the proof of any program resides in the measurement of results." 

Jeffry Pilcher from The Financial Brand added a common sense resolution that is not always followed . . . "stop doing things that don't work." It is clear that if only one resolution can be accomplished in 2012, the measurement of attribution and program results is the most important.