With competition for business customers — especially midsize businesses — getting more cutthroat, banks need to offer new and unique value propositions to make business clients happy.
First Financial Bancorp of Cincinnati is looking to technology-driven financial education as a way to add additional value to its relationships with customers and stay competitive with larger banks in the realm of digital products.
In January, the $6.5 billion-asset bank launched a pilot program with a select number of its business clients with financial education company EverFi, where employees of these businesses can have access to a digital portal that features short articles, videos and other content around personal finance education. EverFi, an education software company, provides the content, with input from the bank on areas of focus. First Financial worked with the businesses on the technology integration.
While several banks already work with EverFi on running financial education seminars for Community Reinvestment Act compliance, and some offer workplace seminars for business clients’ employees, EverFi says First Financial is the only bank offering its digital portal to business clients as a service.
This lets the bank reach its customers and their employees "in a much more relevant way,” said Brian Higgins, first vice president for digital, payments and innovation at First Financial. “The old way of sitting at a benefits fair and handing out brochures or leaflets wasn’t effective at really engaging with people.”
The idea for the program initially came from some business clients expressing an interest in wanting to offer tools to their workers to improve their personal finances.
“We have a pretty large commercial client base, and we heard a lot from them about the desire to bring more financial wellness education to employees,” Higgins said. “Financial stress plays a big role in loss of productivity and workplace absences and can negatively impact the business.”
That led First Financial to seek out a partnership that would help it offer such a service; it knew of EverFi's work with banks on CRA-related financial education programs and the companies entered into a conversation. When the idea of the digital portal came up, Higgins said the bank knew that would be a better option than traditional financial wellness programs. In the current pilot phase, the program is being offered complimentary to those business clients who are part of it; when it gets rolled out to First Financial’s wider business customer base, that may change. In other words, this could become a source of fee revenue for First Financial.
Higgins said the way the information is delivered varies by the company. Some offer it as a part of a human resources portal or company intranet, and some send it in a format akin to an email newsletter with some information and a link to a web portal to read more.
Higgins said that offering such a service can help First Financial compete against larger competitors.
“Our corporate clients know this is another benefit they get from their relationship with us, and they don’t have to go to a larger bank for digital innovation,” he said. “Plus, we work with each individual HR group to really try and tailor the content to what the employees are looking for.”
First Financial’s project is another example of banks turning to technology to hone their game in the intensely competitive commercial banking space. In addition to other financial institutions, banks have faced increasing competition from fintechs in areas such as commercial lending. So, they are looking to get an edge where they can — with faster loan approval times, better integration with bookkeeping systems and mobile phone discounts.
Higgins said anecdotal feedback from the pilot program’s handful of clients has been positive so far.
In order to have the greatest effect, Higgins said, the bank specifically wanted that content to be in a format easily digestible for the employees.
“We didn’t want to have what are often the typical types of content at financial wellness seminars — white papers, PowerPoints,” he said. “We wanted shorter articles, video, visual aspects. We wanted it presented in natural-language-speak.”
Besides adding a service for business customers, First Financial is also building goodwill with the employees. Perhaps they will become customers, too.
“We don’t look at this as a marketing tool and we’re not hitting them over the head with a bunch of buy now buttons,” Higgins said. “But it is branded as First Financial content, and we hope that since we’re providing independent, trusted financial advice to these employees, that they may think of us for future financial needs.”
Specifically delivering engaging digital content could prove to be beneficial in the long run for customer acquisition for First Financial, said Conor Ogle, vice president of business consulting at Sapient Global Markets.
“Handing someone leaflets at a benefits fair or seminar isn’t really effective anymore,” he said. “The way people consume content in this digital age is different. And if you can offer them tailored content — assuming the information and advice is good — in a gentle, nonpushy environment that can be a very effective long-term customer acquisition strategy.”
And having the ability to digitally engage employees also gives the bank “a way of marketing to a little more of a captive audience,” said JP Nicols, a former bank executive and currently managing director of FinTech Forge.
“I think that many banks still struggle to reach the consumer digitally; their marketing dollars are increasingly wasted in traditional forums,” Nicols said. “This is a way to digitally reach consumers directly.”
Right now, First Financial offers information for different areas of the financial journey, but it is up to the employees to self-select — a C-suite executive might click on something about wealth management or investing, and an entry-level employee might seek information about basic checking accounts for example.
But Sapient’s Ogle said the bank could have an even greater opportunity to deliver customized, personalized information if it could integrate data from its business clients’ human resources systems, such as payroll and benefits. Then it could anticipate financial needs and deliver hyperpersonalized content.
“You’d obviously need to get the business and employees to agree, and maybe there would be an opt-in of some kind,” Ogle said. “But I could see something like that being a very helpful service to offer.”
While First Financial doesn’t currently integrate employee data, it is something the bank is planning if its business clients request it in the future, Higgins said. Ultimately, he said the bank is focused on providing useful information to its business clients’ employees in any way they can.
“Banks face a lot of competition,” he said. “If we can create a level of engagement around trusted advice and help deliver avenues for people to learn, I think that helps us in the long run.”