Growth does not come easy for First National Bank and Trust Co. in Phillipsburg, Kan.

The $130 million-asset bank operates in a county with a declining population and where only 11% of area residents have attended college.

To distinguish itself from competitors, First National changed its advertising to highlight achievements by members of its community. In three years, the bank's assets have grown nearly 15% a year and loan volume has increased nearly 9% a year.

"That may not seem like a lot these days, but let me tell you, in rural Kansas, that's a lot," said First National chairman Cy Moyer, speaking at the annual Independent Community Bankers of America convention here last week.

Mr. Moyer was one of several community bankers touting a strategy advocated by a small Glenwood Springs, Colo., advertising agency, Chandler Marketing Co.

Instead of trying to sell certificates of deposits or checking accounts in ads, Chandler president Michael Chandler said small banks should consider using space or airtime to recognize people who have made contributions to the community.

"There's no doubt in customers' minds that you have checking accounts," Mr. Chandler said. "Don't tell them."

First National used to devote its marketing budget to promoting CDs and other products. Today, its newspaper and radio ads are more likely to salute schoolchildren for their community cleanup efforts. The ads typically feature voices of bank employees.

"They hear our ads, and they feel comfortable coming in and talking to us," said Mr. Moyer. "All you need to do is get them in there, then you sell them products."

Of course, product ads are sometimes necessary. In those cases, said Mr. Chandler, banks should spotlight the customer first and the bank second.

John Cooper, vice president of marketing at $650 million-asset Alpine Bank in Glenwood Springs, Colo., agreed. He said customers are less interested in the home equity loan than in what they can obtain with such a loan-a new car, a new kitchen, or a vacation.

"They don't care about the bank, other than how it can help them be happier and better off," Mr. Cooper said.

Small banks also should consider promoting community events in their advertising, Mr. Chandler said.

Olathe (Colo.) State Bank, for example, cannot afford to write a check every time a fund-raiser knocks on its door. But the $24 million-asset bank can use its radio spots to urge members of the community to attend the local pancake breakfast.

"You can promote the event in your advertising, and people will think your bank was responsible for putting on the whole show," Mr. Chandler said.

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