SAN DIEGO — Consumers have changed, marketers have not kept up, and now credit unions and other financial institutions must scramble to deal with a new reality.
That was the message from Ron Shevlin, senior analyst with Aite Group, a Boston-based research and advisory firm.
For decades, Shevlin noted, marketing majors were taught the "Four Ps": product, place, price, promotion. In their place has emerged a modern group of "Three Ps": predict (where and when consumers will buy something), push (push messages, push products), and pray (for a better response to the last campaign, so the marketer can return to management and ask for a new budget).
Among the reasons for this change, Shevlin said, is the fact women increasingly are driving today's financial decisions, younger people from Gen Y are the targets for marketers that want to grow, even though it takes five of them to equal the wallet of one baby boomer, and consumers have become more self-directed and less reliant on firms.
"On the supply side, there are more points of involvement between consumers and companies," he explained. "Not points of sale, but points of involvement. There are websites, search engines and social networks."
Among the long-held marketing myths Shevlin challenged is: marketing is the story marketers tell to consumers. Instead, he argues, marketing is building relationships.
"Marketing is getting customers to tell stories to themselves at the moment they reach for a product on the shelves." Leading up to that point, he continued, "small moments of attachment" are important. "Loyal customers tell stories about helpful employees they encountered that helped them make the right choice, about companies that are really easy to do business with. The common thread is, the customer had to experience the moment."
As an example, Shevlin said one bank customer related to him a story of asking an advisor about opening a CD. The advisor told the man he could get a better deal at another bank up the street. Said Shevlin: "That guy walked out the door, but he also came back to that bank later to do more business. He said, 'If I can trust them to tell me when I can get a better deal elsewhere, I know I can trust them for other things, as well.'"
The Aite Group definition of engagement is a series of interactions that strengthen a customer's attachment to a product or firm. Engagement makes economic sense, Shevlin argued, because highly engaged customers (or members, in the case of credit unions) are much more likely to recommend a product or institution to their friends.
"Trust is related to engagement, and it is multi-dimensional. Trust must be demonstrated in sales, service and in operations."
To build a solid relationship infrastructure, Shevlin recommended engaging in social media, building trust through an onboarding program, and scaling advice through personal financial management.
"It is important to know what to say to customers when you do reach them. Marketers do not always know how to have a conversation with customers because they just know pushing messages," Shevlin said. "The old process is to push people; the new process is to get people to participate. Sensing needs and responding with products to meet those needs is critical."
