Dance with the Person That Brought You

eContentplus, Inc.     Monday, July 15, 2002

By Jerry Groskind

[Editor's Note: This is the second article in a regular series of monthly articles by attorney and financial industry consultant Jerry Groskind focusing on internal, investor and marketing communications issues relevant to small and mid-sized community banks.]

When my sister and I were teenagers, my mother gave us some good advice: "Dance with the person who brought you." In other words, you should pay attention to the person you took (or who took you) to a dance. Common courtesy dictated that behavior, she explained, but so did self-interest. If you want to be invited to future dances, or expect your invitations to be accepted, you can't ignore your date. You can dance with others, but your focus should be on the person who brought you.

That advice applies equally to banks and their marketing strategies. Your customers and prospective customers are interested primarily in the financial products and services you offer and your marketing campaigns should reflect that focus.

Swimming Pools and Golf Balls

The more you know about your audience, the better your ability to design communications and marketing programs that work for them. But raw information can be misleading; you need to interpret the information correctly and consider carefully how its application will affect consumer behavior.

A major vendor to the banking industry learned those lessons the hard way. The vendor determined through demographic data that bank executives were much more likely than the general population to be golfers and to have swimming pools. That was clearly potentially valuable information, but how best to use it? The vendor's answer was to design an entire marketing program around golf - golf ball graphics, golf themed giveaways, direct mailers with fairway views - the whole enchilada.

So how did the campaign go? In a word, the results were dismal. Statistically, the response rate was not terrible, but the responses were not related in any way to the products the vendor was promoting. So what went wrong? Probably a number of things.

First of all, golfers are a dedicated bunch. They enjoy everything about the game - playing it, watching it on television, buying golf clubs and related gadgets, and watching video tapes to improve their game. They even enjoy the fairway views depicted in ads for golf products. But golf, the game, has little to do with the business of banking. Bankers may play golf with their customers and co-workers, they may even discuss business on the links, but there was nothing to connect that par 4 hole on the back nine with the products the vendor was promoting. The vendor wasn't selling golf products to golfers; it was selling bank products to bankers, some of whom also happened to be golfers. In short, there was no clear nexus between the marketing campaign and the product line the campaign was promoting.

That wasn't the only problem. Although golfers may be dedicated, people who are not golfers are either bored by the game, or, even worse, annoyed by it. There are times when you will want to target a campaign at some of your customers; in fact, the more targeted marketing you can do, the better. But you want to make sure the campaigns you aim at some of your customers don't turn off the rest of them.

It is also possible that the product this bank vendor was promoting was itself sub-par. No promotional campaign, however clever, will make up for a deficient product; but the goal should be to give the product at least a fighting chance.

Lessons

What should you learn from this vendor's experience? It's always a little dangerous to project too much from a single example, but this case study does illustrate some of the problems financial institutions can encounter in their communications with customers and potential customers. The most important and obvious message is that your customer communications ? marketing campaigns, Web site content, email and direct mail - everything you produce should be tied directly and clearly to the products and services you are promoting. That does not mean that every word has to be directly related to a product, nor does not mean that all of your communications should be blatantly promotional. On the contrary, there is a place, and an important place, for informational material designed not to sell a particular product or service, but to illustrate your understanding of your customers and your desire to help them accomplish their goals. That's a subject for another column.

The key point here is that the CONTENT you send your customers should be related in some way to the underlying products or services you want them to purchase from you. Or, as my Mother would say, "Dance with the one who brought you." Banks provide financial services to their customers. Unless you are planning to establish a niche as a bank for golfers, a promotional campaign focusing exclusively on golf probably is not a good idea.

By all means, collect demographic information about your customers and use it. But make sure you target the information, too. If you discover that residents in your market area are more likely than the general public to have swimming pools, design a campaign around a loan for building or refurbishing pools, but send it only to the borrowers who have pools or are likely to want them. (Occupants of apartment buildings clearly should not be a prime target for this campaign.) And those customers and potential customers may also be interested in an occasional article about liability or maintenance issues related to swimming pools. The difference between this and the vendor's golf campaign is that it is anchored firmly to a product you offer. And it is far more likely to produce the results you seek.