It's perhaps the most delicate balancing act facing community banks: investing in digital marketing channels while still preserving the face-to-face service and hometown identity that are part of their business DNA.
Put another way, the locals may not pop in for a coffee and chitchat with a banker as often anymore, but community banks don't want to abandon the Main Street charm that attracted customers in the first place. So how do they do it all?
"That's really one of our burning questions," said Anna Weston, vice president of marketing for First Financial Bank in Cincinnati. "Our value proposition is based on relationships; at the same time our customers are used to ordering something from Amazon and getting it the next day. They expect things to be that way. So we have to figure out, how do we bridge that gap between personal and digital?"
That quest led the $6.5 billion-asset First Financial to experiment with technology from Segmint, Weston said. Segmint provides analytics and marketing tools to the financial services, health care and retail industries to drive targeted marketing communications.
Last year the bank started using Segmint so it could send personalized marketing messages via digital channels, using demographic and transactional customer data — such as where customers live, how many income-producing assets they own, or if they have children — as well as third-party data from Nielsen or other market research firms.
"Marketing to broad groups, like saying you're marketing to millennials, doesn't work anymore," Weston said. "Micro-targeting has allowed us to deliver different messages with a specific call to action for many different groups."
The plan appears to have been successful. First Financial says it has sold 2,000 new products in the 12 months since adopting this marketing strategy.
"We identify a specific audience, create a campaign with targeted messaging, and so far it's worked really well," Weston said.
So for example, the bank can learn more about customers who have similar incomes, distinguishing a "bargain hunters" subgroup whose members are solely interested in price when making product decisions from others who are interested in more sophisticated financial planning.
But that does not mean the branch is being forgotten. First Financial still wants to have that Main Street presence, but with an updated twist. This means investing in technology such as interactive teller machines that let customers speak with bankers at a central contact center after hours, along with creating smaller branches staffed by highly specialized personnel.
It also means knowing your customers in a way that larger competitors often cannot.
"We're in metro markets and in tiny communities, so we want the branches to serve those specific communities," Weston said. For example, First Financial has one location with a lot of Amish customers; so the bank built a hitching post outside branches where those customers can tie up their horses.
"Amish people have banking needs, too, and we're trying to serve them as best we can," Weston said.
That type of distinctly community-bank touch should not be lost while also investing in digital, said Jacob Jegher, senior vice president at Javelin Strategy & Research.
"Community banks usually represent a higher-touch environment," he said. "Having that one-on-one relationship puts them at an advantage. So if they can invest in digital marketing technology to target their customers better, and combining that with the local relationship manager who already to some degree knows their customer, that's a leg up on the big banks."
But no matter the size of the bank, Jegher said all financial institutions need to engage in highly targeted and personalized marketing communications, as the era of "mass marketing" will not work with today's consumer.
"This is an industry that historically has gone into this space in a blind manner; offering you a credit card you already have is one common example," he said. "But with the data banks can have on their customers, they should be able to understand their life needs much better now."
And this can go beyond simply hawking new products, like using data to help customers examine their spending and budgeting habits on the fly, said Ray Chandonnet, principal at Second Act Capital Partners, a bank consulting firm.
"So a bank could integrate my credit card information, my bank account information, with things like how much money I spend on Venmo or on the Starbucks mobile payment app to really give me a customized, individual look at my financial life," Chandonnet said. "At the end of the day the world of finance is predominantly a world of information."