talhakhalil007 / Pixabay
Within the past year, banking has undergone a sea change of technology-driven transformation pushed ahead by the coronavirus pandemic. Banks in different strategic phases are feeling the effects — especially in the areas of lending, digitization, and marketing technology (often called “martech”). The emergence of so many solutions built to address specific challenges, such as more effective targeting or enhanced customer onboarding tools, puts banks at risk of deploying new technology that solves problems that don’t exist — or, at least, aren’t at the top of the priority list.
New technology can and should be used in a way that positions marketing teams as strategic partners with line-of-business leadership. But the reality is that many banking institutions are lagging in aligning new marketing technologies with recast digital-first strategic corporate objectives.
5,586 companies in the world have over 200 years of operating history – 56% of them are in Japan
Japanese Value Investing with a local fund manager – Jiro Yasu Japan is often considered to be one of the most fertile places in the world for value investors. Unfortunately, Japan’s equity markets are also beset by problems, including the poor capital allocation policies of Japanese management teams, making the region a frustrating place to Read More
Get The Full Walter Schloss Series in PDF
Get the entire 10-part series on Walter Schloss in PDF. Save it to your desktop, read it on your tablet, or email to your colleagues.
Q4 2021 hedge fund letters, conferences and more
We know this because bank marketers are speaking up about keeping up. They’re saying that marketing solution opportunities flood their desks every day, but there’s no reliable way to measure whether these new operating solutions will move them closer to their goals. And betting on solutions that won’t actually create positive returns can put marketers years behind in addressing an institution’s competitive priorities going forward.
Marketers need to know how to navigate within the bank’s existing technology model when looking to deploy new martech solutions. They must then choose from either a potentially limited set of capabilities within the core offering or from a profusion of solutions from martech providers positioning themselves as “best in class.” While there’s neither a right nor wrong approach, marketers should weigh their options according to strategy rather than wow factor.
To inform their decision and determine whether a martech provider can actually solve a problem, marketers often rely on third-party information or intuition. For many, though, the ability to determine how viable these solutions are has evolved much faster than the strategic needs of the bank.
However, the fear of missing out on cutting-edge innovation can lead to hasty decisions. Before selecting a martech solution, you need to be willing to ask yourself difficult questions to determine whether it’s right for your bank. Bank marketers need to stress test what they hear from all potential marketing technology providers through market research, peer reviews, references from customers who are currently using the technology, and just plain common sense — trust but verify.
There’s a host of credible advisory firms that publish assessments on banking martech solutions. If your institution doesn’t have a subscription to leverage for detailed insights, publicly available research is more convenient to access than ever. I know I could’ve made better decisions decades ago with the sheer number of free insights available today.
At the same time, develop an internal scorecard to assess how your current martech providers respond to your request. Just because they’ve worked for you before doesn’t mean they understand where you want to go now.
From there, perform a gap assessment and figure out whether you can get by with your current partners, if you need to augment their work, or if you need to find a new path forward. This is hard work, but it’s the only way you can credibly demonstrate that the marketing function understands strategically where the bank wants (and needs) to go to survive and compete.
You can’t just take the provider’s word for it, even if it’s from your current core provider. That’s too big of a risk. Some banks will be the first to try it, but your company’s risk tolerance might determine that you don’t want to be that institution. So take your time. Refine your initiatives and strategy because the spending on bank martech may or may not steadily increase in the coming years. It’s critical that your decisions can scale at a rate that reflects where the bank wants to find growth.
The Future of Martech Spending
Today, social media and mobile outreach are rapidly augmenting traditional marketing channel usage, and experts believe that financial institutions will continue to spend more on digital marketing than on traditional marketing channels in the years to come. Statista reported that banks spent $19.6 billion on digital advertising in 2020. As the economy rebounds, that spending will most likely increase to $23.6 billion in 2021.
To determine where those digital marketing dollars should go, banks must reflect on what the customer experience will be post-coronavirus. If online account openings continue to prosper, for example, you should focus on marketing to prospects who are open to doing that. And if your bank has a hybrid branch and online strategy, then you should market accordingly.
Ultimately, you’ll need to change your marketing plan to a real-time model. If your martech partners can’t turn on a dime to help you, then find new ones. The unknown should be the new operating model for bank marketers, so it’s time to create marketing plans that are iterative and adaptable as the needs of the bank change.
About the Author
Rick Hall is the managing director of the Banking and Financial Services practice at BKM Marketing, a boutique marketing communications and strategy firm based in the Boston area with a deep focus on the financial services industry. With more than 25 years of experience as a banker and management consultant to the industry, he focuses extensively on product development, customer analytics, strategic marketing initiatives, and payment strategies with a key focus on the small business and commercial sectors. In his role at BKM, Rick directs the firm’s strategic relationships for banking, credit union, and fintech/technology clients.
Updated on Mar 21, 2022, 4:41 pm