Last month, my colleague, Mike, posted about the whitepaper that emfluence recently published about the impact of bank onboarding. The whitepaper highlights research in the banking industry specifically that will (hopefully) have a profound impact on how banks will look at their marketing spend and overall customer communication focus.
The report, reaching back as far as three years ago, paints a detailed picture of a changing marketplace where customers leave banks at an alarming rate (8-10%) within their first two years of joining, and often because of a simple lack of effective, consistent and timely client communication.
There’s an obvious and simple solution: rebuild your communication approach for your banking customers in a way that can automatically nurture them and build long-term loyalty. If your customers are leaving you for services they didn’t know you had, then all you have to do is have a better plan for telling them about your offerings.
A key component of better communication with your new and existing customers is automated messaging: a kind of intelligent design that segments customers into specific, detailed and appropriate profile “paths” and then delivers the messaging on a regular basis that fits their profile. This strategy can help ensure that each customer receives the right message at the right time through the right medium.
My team did a lot of research on the impact and importance of segmentation. We found a 2011 study by AdKit Global that stated that banks typically sort their customers into roughly 2-4 profile paths, focusing mainly on assets and liabilities, geographic and demographic data, and calculated profitability measurements, the latter usually defined by each financial institution for themselves. AdKit found that though the top-level segmentation was a positive effort, sticking to this strategy alone didn’t allow banks the opportunity to truly drill down into the individual needs of its customers. They weren’t as effective or targeted as they could have been, and so lost potential loyalty and potential revenue.
When our clients use the emfluence Marketing Platform for their email and marketing automation, we advocate extremely in-depth segmentation, that allows us to then drill “up” to the highest common denominator for each and every specific customer. We can help our customers tailor their messaging specifically to each client using the elements of many common offerings, to create a pinpoint targeted and timed campaign and to ultimately see an increased return on every marketing dollar spent.
Sure, giving out a toaster as a one year thank you gift is nice. But how are you capitalizing on the wealth of information and detail you have for your customers? Can you use that customer’s own profile to cross sell, up sell or retain that customer into the future by maximizing your relevance and schedule?
Especially for customer retention, one-to-one relationship building is key. I believe banks will begin to change the way they look at their customers and create their marketing to suit and to serve that customer better.
Consider your potential impact:
- increase profit through retention and increased customer lifetime value
- spend less on acquisition – cut losses by reducing attrition
It’s hard to see that as anything less than “Win, Win.”