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Banks Have a Case of Digital Marketing Myopia

The rush to digital marketing has taken on a life of its own. Search engine optimization, content marketing and social media are hot topics driving bank marketing conversations, financial blogs and campaigns.

Few appreciate the cost-efficiencies of digital channels more than those of us who, in earlier times, wrung our hands over print and electronic advertising that brought little in the way of measurable results. But in the rush to embrace all things digital, many bank marketers have bypassed critical thinking and strategic planning.

The truth is that digital solutions are ideal for some marketing challenges but a poor choice for others. In the financial services industry, digital marketing tactics can sometimes be too expensive, too limiting, or too impersonal. And there are three important customer groups that digital marketing tactics may fail to reach.

High-balance, high-profit customers in community banks tend to be 65 or older. They are also less likely to have mobile accounts, use bill-pay services or even have email addresses. Forty-four percent of people over age 65 do not use the Internet, according to a 2013 study from Pew Research Center. The percentage is even higher among those over age 75. In my experience, this critically important age group often controls a substantial portion of deposits. No amount of pay-per-click advertising or social media postings will reach them. They remain a segment that must be reached by mail, telephone or in-person visits.

Digital marketing efforts may also fail to land with the financially struggling customers who frequent community banks. These customers straddle the line between banks and non-banks. They may have a bank savings account as well as a pre-paid card from Walmart; they might visit banks to cash checks but turn to payday lenders for a loan when their car breaks down. Because people in this group may feel intimidated or uncomfortable using banks, they place a high premium on personal service.

But according to interviews conducted by First Data, unbanked and under-banked people often “felt like a number" to their financial institutions and "did not get clear, helpful or consistent information" from bank employees. Digital technology and emails won't address these concerns. Only personal service will.

Millennials, or 18- to 33-year-olds, would seem to be prime candidates for a digital strategy. That's not always true. People in this age group tend to be wary of banks, especially national institutions. They value authenticity in relationships, are financially cautious and want money management help.

Since millennials are constantly on their smartphones, they are assailed with hundreds of daily emails. And what do we do? Send them more emails. They want hand-holding; we send emails. They want advice; we send emails. This strategy is unlikely to spark enthusiasm among an already guarded group.

A better alternative may be to go with old-fashioned snail mail, according to a December 2011 Nielsen report. Ninety-two percent of millennials said that direct mail was likely to influence their choice of stores, while 78% said the same of retailer emails. Millennials regard a personalized letter (not a mass mailer) as a novelty. It grabs their attention and makes them feel special. But it's more expensive for banks to send printed material, so emails are what they get.

These kinds of communication challenges occur daily at most banks. They demand an exploration of all communication options, not an automatic default to digital.

Marketing managers are abdicating responsibility when they go directly to web developers, digital agencies, email providers and social media gurus. Digital channels are simply communication tools, not strategies in and of themselves.

Social media gurus, web developers and big data analysts aren't marketers. They may understand many key concepts, but they rarely have the depth of experience to create a comprehensive marketing campaign. Nor do they have a deep understanding of a bank's customers, products and goals.

There's still a place for direct mail, public relations, billboards and newspapers in most marketing plans. You've just got to know how to look for them.

Kevin B. Tynan is senior vice president of marketing at Liberty Bank for Savings in Chicago. He can be reached at

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