Bank Marketing Fantasy #1
Rachel Johnson returns home from a full day at the office. Her children rush past her, tossing the day’s mail onto the kitchen table where her bank’s marketing flyer lands on top of the heap. Rachel drops her pocketbook, opens the flyer and sighs with relief and decision – tomorrow, she will open an account.

If only it were that easy.

Today’s hyper-competitive business environment demands every watt of banker power. Winning new customers is only the beginning, for the bank must then balance its growth in deposits against skittish loan demand and vice versa. Local, regional and national economic trends all influence product decisions. Banks not only must consider the short and long term consequences of offering a premium rate – they need to predict competitive reactions and develop their own reaction to the reaction.

Bank Marketing Nightmare #1
Joe President orders Bill Marketing to develop a new set of product strategies in one week. Bill imagines his office filling with computer printouts and his eyes going buggy from boiling down the numbers into something meaningful. In the end, Bill fears that his information will be incomplete, his analysis flawed and his results unsatisfactory. Yet he must execute…

Will today’s technology help or hinder the bank?

For years, bankers have measured information by the pound – the more a bank has, the better. But today’s banks are narrowing their focus to the information that needs immediate attention. This is a different concept of information that can help banks avoid information by the pound.

Instead of paper stacks with thousands of figures, managers receive dashboard displays on their smart phones, spreadsheets that update automatically, and custom work lists for each area of the bank. These tools help bankers manage complex operations with pinpoint accuracy. When the system reports what matters, bank employees make better decisions.

Bank Marketing Fantasy #2
Rachel Johnson enters the bank with her mailer in hand. She approaches the new accounts desk hoping she can complete her business before her lunch hour runs out. The Customer Service Representative enters Rachel’s name into the bank’s computer system and calls up Rachel’s complete banking relationship. Because the CSR sees Rachel’s photo on screen, no ID is necessary. Rachel transfers her initial deposit electronically, and the new account is opened. Rachel has plenty of time to eat her lunch.

Is anybody doing that today?

Today’s technology, built on customer relationships and able to incorporate different types of information (such as photographs and signatures), open a world of efficiency and possibility to today’s community banks. Being able to link the many new systems (security, CRM, check image, Internet banking, etc.) in real time can give a bank distinct advantages.

Many financial institutions still rely on account-based systems that gob together a view of the customer’s relationships. The gob approach prevents bankers from seeing a 360 degree view of their customers, making it more difficult to identify and promote the most appropriate products and services for each customer. And photographs…that’s a different system altogether!

Bank Marketing Nightmare #2
Bill Marketing knows that different customers need different products, but how can he determine which? Knowing that a customer lives in a particular neighborhood doesn’t reveal much about that customer’s children, housing needs, or retirement plans. All are critical factors when determining the next best product to offer in the increasingly rare and competitively charged meetings between customer and CSR.

Can we do any better?

When a computer system uses the customer as its basic building block, marketing plans can be developed and executed far more easily. The system can determine several “next best products” based on the customer’s activity via credit cards, bill payments, online banking activities, third party sources, etc. Armed with that information, the bank can see how those products affect the customer’s overall profitability and make the right product offer at the right time.

The system can then track the offer through referrals and eventual sales, and generate accurate incentive compensation to every bank staff person involved in the sale. This instills staff confidence in the sales process, reinforcing goals and increasing overall bank performance.

Bank Marketing Fantasy #3
The product that inspired Rachel Johnson in Marketing Fantasy #1 rewards her for using the bank’s lowest cost channels. Paying her bills online, using her debit card, and receiving her statements electronically add up to big savings – even while the bank pays an above market interest rate. That makes Rachel very happy with her bank.

Umm…we’re kidding, right?

Not at all. Next generation technology makes it possible for banks to reward their customers for behaviors that reduce cost and increase customer loyalty. Better yet, these products have been proven to attract deposits from customers of all ages, particularly younger customers who strongly prefer electronic delivery channels over branch visits.

Today’s bankers can see the costs associated with each delivery channel as well as the cost of funds. Combine the costs with customer demographics and buying behavior, and a bank can develop services that distinguish itself in the marketplace and deliver profit to the bottom line.

Technology is also finding more ways to help the bank’s backroom, such as managing cash reserves and processing checks as images. Bankers who take advantage of these technologies are better able to manage their costs.

Bank Marketing Nightmare #3
New products and delivery channels are growing like weeds around Bill Marketing’s office. How will he keep track of them all and know which ones are growing, shrinking and holding steady?

Talk about a tall order – could this one get any taller?!

Actually, the reporting and monitoring challenges are less daunting than Bill thinks. Today’s technology can provide tailored information to every level of bank personnel. Senior executives can receive cash flow reports on their smart phones. Loan collectors read through delinquency lists on a daily basis with everything they need to start knocking on doors. Branch managers can read about their employees’ sales and referral activities. The loan manager can see total payoff dollars, new loan disbursements, and late fees waived every day. Supporting details are just a mouse click away.

Better yet, “dashboard” displays make the data even more valuable. For example, a bank can observe overdraft waivers by employee using a dial to represent each person. With an acceptable number of waivers, the dial shows a needle in the “green” or acceptable zone. If the employee is too generous with the waivers, the needle points to the “red” or action zone. Clicking on the visual opens the more traditional report view with all the supporting details.

The limits on Bill’s information are pretty much Bill’s limits. Today’s technology can provide what the bank needs to know.