About two decades ago, Citibank’s New York Marketing organization sponsored a “think like a retailer” workshop. At the time, it was a cutting edge moment as the key note speaker, an executive from Macy*s, kicked-off the event designed to inspire bank marketers to bring retail’s bag of tricks to the Citi bricks and mortar franchise.
Since then, have banks succeeded in thinking like retailers? If success is measured by changed nomenclature – from branch to store – or elevated customer experience featuring in-branch greeters and hospitality bars, then yes, banks have achieved some degree of retail expertise. However, new influences – like the convergence of media and the changes to how consumers receive and interact with advertising – require banks to be more discerning about what being a retailer means.
Beyond great visual merchandising, which even two decades later tends to be how banks check off the “think like a retailer” box, two fertile areas that banks should explore are rankings and customer reviews.
Rankings
A noticeable trend in bank marketing is to leverage “top ratings” by recognizable consumer groups, financial publications and websites. Historically, our bank clients soft-peddled competitive comparisons and declarations of superiority. Even compelling statements that could safely be footnoted and attributed to a third party were off the table.
But times have changed. From small banks to big banks, from checking to credit card promotions, the ratings are in, and there seems to be something for everybody to tout. The proliferation has softened the impact and contributes to a “me too” competitive landscape. Here are a few examples:
- Amex: Highest in Customer Satisfaction (J.D. Power)
- Discover: Best Online Savings (MONEY® Magazine)
- Arvest: Highest Customer Satisfaction South Central Region (J.D. Power)
- U.S. Bank: Best Basic Checking and Savings (MONEY® Magazine)
- M&T: Small Business Excellence (Greenwich Associates)
- Chase: Credit Card – Editor’s Choice (CardRatings.com)
The use of third-party ratings like these is appropriate for print communications where personal testimonials and reviews are not always practical. However, showcasing a high rating without pay-off or fuller explanation – What made the product an “Editor’s Choice?” What qualities contributed to the J.D. Power endorsement? – remains a missed opportunity for marketing products and services.
Customer reviews
Competitive rankings are nice, of course, but “the real deals” are those few banks and lenders who look beyond third party endorsements to the more credible, believable and powerful customer endorsements. To ensure a formal review process, protect a brand with reliable moderation services and uncover key insights, in-the-know banks are establishing partnerships with the same vendors who serve the best and brightest of direct market and e-commerce retailers like Cabela’s, Geico and Avon.
Financial institutions that are doing this well include Schwab, Discover, Navy Federal Credit Union and Lending Tree. They understand that modern marketing represents a shift: where consumers once took action from information gleaned from traditional sources, consumers are now more likely to pay attention and take action on a personal review, endorsement or recommendation. For example, Navy Federal Credit Union enables prospective customers to read all 541 reviews about its EveryDay Checking account. Charles Schwab, clearly the ratings and reviews leader, brands customer reviews on its web site, using the Schwab’s “Clients Speak “ program to amplify its corporate brand pillars of transparency and honesty.
Where customer endorsements really gain steam is in the network effect, a word of mouth circuit controlled by consumers. Well-positioned and well-prepared businesses can use this to their advantage, as Schwab does. Referrals drive 40 percent of new customer acquisition, and now Schwab is sharing in a way it says is important to growth: “Social tools provide a venue for increasing customer transparency and, in the process, customer advocacy.” What is it learning? Schwab’s early research aligns with the retail space, where 51 percent of U.S. online adults agree, “Ratings and reviews help me decide whether or not to purchase a product/service.”
To really “think like a retailer” – and not only listen to your customers (you’re already pretty good at that, banks) – give your customers opportunities to review, rate and endorse. Your customer advocates will tell their friends and family all about you, your products and services, expanding brand awareness and developing potential leads.
Ready to think and act like a retailer? Media Logic can pave the way with strategies and resources designed to help financial institutions learn from and leverage marketing for a social world, just as our retail clients are doing today.