Christopher Liechty, VP of Marketing at Bank of American Fork, owned a marketing design firm for 15 years. After working with several financial services companies, including American Express, Liechty entered the finance industry and has remained here for the past 8 years. We talked to him about how bank marketing has changed, and what can be done to balance logical and emotional appeals within banking.
What are the biggest shifts you've noticed in bank marketing since you started?
When I came to Bank of American Fork 8 years ago, I thought that I would switch from the bank’s traditional marketing efforts and focus almost completely on a measurable digital approach. However, I’ve been surprised to find how much certain traditional marketing efforts still matter. For instance, I’ve found that school sponsorships still help us effectively maintain our brand recognition in the area. The same is true of some billboards, radio ads, and magazine spots — though we have definitely cut back on those in the last few years. So while there has been a definite shift toward digital the shift hasn’t been as dramatic as I initially thought it would be.
How do you decide which parts of traditional marketing to keep and which parts to discard?
It’s difficult because the decision relies largely on anecdote. For example, we simply received no feedback from our newspaper ads so we cut them almost without exception. In one case, pulling the ads was hard to do because our decision was traumatic to the owner of the newspaper. We held on longer than we would have otherwise, but in the end we still did it and we haven't missed it. Our money has been spent better on other things.
What would be the tradeoffs if you did decide to go completely digital?
Our bank would be conspicuously absent in the community, especially because our customers tend to be traditional. For example, we do 18 parades every summer in our various markets, and we're often the biggest thing there. If we were to pull out from that tradition, there would be a conspicuous absence. The same is true with certain aspects of mass media.
That isn't to say our customers are not all over their smartphones and online banking, because they are. We see huge involvement there. When Apple Pay came out, our customers kept asking when we were going to offer it. However, just because our customers are enthusiastic about digital offerings doesn’t mean we can go completely dark on traditional forms of advertising.
What do you think community banks should be doing that they're not doing?
Most community banks have a big blind spot when it comes to marketing in general, and they need to fix that. I look at our smaller competitors, those with $700 million and less, and they don't even have marketing departments. In some cases they essentially have half a marketing person who spreads their time between projects.
I’ve wondered why that is, and I think one reason is that banks tend to be driven by lenders and financiers — people who by nature and by training are skeptical of emotional hype. They hear potential customers come in and say, “My business is doing awesome! It’s going to be super profitable! Will you lend me money?” And these bankers take that hype and discount it as irrelevant. They want numbers.
It’s like the loan officer is given a piece of cake and all they want is the cake. They take the frosting and scrape it off the top. They want numbers and they want details. They don’t want to be influenced by enthusiasm or excitement that may or may not be connected to reality — and often rightfully so.
So you think bankers could do a better job of balancing their skepticism of emotion?
Yes, I think bankers tend to be too skeptical of emotional appeals, which are what make marketing effective. Branding, in general, is frosting. So right off the bat there's this hesitancy from financiers to get behind emotion-driven marketing initiatives. And yet improved branding helps banks gain new business. For instance, there was another bank in 2008 that was neck and neck with us in terms of size and scope, but we had five people in marketing and they had one. Now our bank grown much larger, and I attribute that in part to doubling down on the marketing component of our business. Consumers in our area know who we are and what we stand for, and they’ll often come to us first to get a loan because they like our brand.
What is the main focus of your marketing team now?
Well, the growing areas are definitely in digital marketing; however, we have also focused lately on doing a few large-scale events.
In the past, we would try to sponsor frequent events, such as seminars, on a monthly basis. But we’ve found that putting on fewer events with more resources has yielded better results for us. We reserve a local sports park every year and rent go-kart racing for a day so we can celebrate with around 150 of our top prospects and clients. We produce a high-end invitation and high-end gifts, and when the day is over everyone says that the event was so cool and they’re grateful to have made some new business contacts. It helps us get in touch with people who are reticent to talk to us.
How will bank marketing change in next 10 years?
I tend to agree with the saying that people overestimate how much technology is going to advance in 2 years but underestimate how much it will advance in 10 years. People say that new tech will be here right away, and when it doesn't happen they get lulled. They say it will never happen, and then they’re surprised 10 years later when everything suddenly changes.
I think the same is true for banking, though I might say we overestimate the amount of change in 10 years but underestimate the amount in 20 years.
To make certain we don’t underestimate the changes, we need to put everything we've got into moving toward digital. With some of the digital technologies like MX and Apple Pay, people are right at the cusp of changing their behavior.
What are the most important lessons you've learned during your 8 years as a bank marketer?
It comes back to the cake and frosting analogy. I’ve had to realize that I need to bolster all my desires for emotional banking with solid logic and numbers. I now put all my plans in writing and be sure to show that I’ve considered all the possible challenges and risks before I ever show anything to the finance side of the bank.
Engaging in this practice has strengthened the relationship between financiers and marketers. I respect and admire what the finance people and lenders do, and I know they respect what we do in marketing. We're trying to pull in the same direction, and we have to trust one another as we strive to strike the right balance between numbers and emotions.