THE DIGITAL BANKING INDUSTRY LEADERS FORUM ™

In the rapidly evolving world of business, marketing has emerged as a strategic growth initiative. It should be no different for credit unions. Traditional marketing methods, such as print, broadcast, direct mail, phone, and outdoor advertising like billboards, have long been used to reach various audiences. However, the advent of digital marketing revolutionized the way businesses communicate with their customers. Digital marketing encompasses many areas and is itself evolving rapidly as it leverages huge volumes of data and AI insights to transform what it can accomplish.

The Shift to Digital Marketing

The shift towards digital marketing has been driven by cultural, technological, and societal changes. Today’s consumers are more connected than ever before, with access to information at their fingertips. This has led to an increased demand for personalized and relevant content. Credit unions that fail to adapt to these changes risk being left behind.

Digital Marketing Is Not Monolithic

Digital marketing has evolved significantly over the years, with different progressions marking its growth and development. Key stages in its progression include:

1. The Advent of the Internet, which marked the beginning of digital marketing as we know it today.

2. Email and Search Engines which with the growth of internet users became the way for customers to find products.

3. Big Data where the increase in digital consumer activity led to massive developments in data and storage technology. This led to insight into who the customers of a business were and how best to connect with them.

4. Social Media and its rise allowed big data to grow even larger. Companies could now track human behavior patterns, create precise marketing efforts, and even offer predictive analytics.

5. Smartphones, from the release of the BlackBerry in 2003 to the Smartphones of today, what has not been said about this revolution? It certainly opened up an incredible new channel to engage consumers.

6. Marketing Technology Platforms allow businesses to use data on both the front end to tailor marketing messages and the back end to measure performance. By being able to scale data mining, personalization and analytics, these market tech platforms are both more affordable and an important investment for credit unions.

The Digital Marketing Maturity Model

According to BCG’s research, financial institutions (FIs) worldwide are at various stages of digital maturity. The research identified five archetypes of FIs based on their level of digital maturity:

1. Frontrunners are those FIs leading the way in digitization, with a strong digital strategy in place and scaling their digital initiatives effectively.

2. Beginning and Advanced Digital Strategists are those that have a digital strategy in place and are seeing positive results from their investments.

3. Digital Strategy Skippers are investing in digital technology and employee capabilities but without a guiding strategy, resulting in a struggle to scale their initiatives and often see them atrophy over time.

4. Late Adopters are just beginning their digital transformation journeys or have not yet started.

In addition, separate BCG research found that companies self-divided into four levels of digital marketing maturity: nascent, emerging, connected, and multi-moment. Each stage represents a significant progression in digital marketing, offering new opportunities for businesses to connect with their customers and drive growth.

BCG’s research found that more mature brands increased their sales by an average of 18 percentage points more than their less mature peers and boosted cost efficiencies by an average of 29 percentage points. And these companies outperformed on market share as well by 2X more than low-maturity brands and 3 percentage points or more on average.

The level of digital and digital marketing maturity undoubtedly has a significant impact on a financial institution’s performance.

The Power of Data and AI in Marketing

One of the key advantages of digital marketing is the ability to leverage data to gain insights into customer behavior. With the immense amount of data available today, combined with artificial intelligence (AI), credit unions can gain tremendous insights into the needs and preferences of their members. Furthermore, member expectations for more customized, even personalized, outreach and interaction continues to grow.

These insights can be used to tailor marketing messages and offers to individual members, showing them that the credit union truly knows them and cares about their financial wellbeing.

Marketing Performance: You Can’t Manage What You Don’t Measure

It’s not enough to simply execute marketing campaigns. Credit unions must also invest in measuring the performance of these campaigns. Without this crucial step, they risk squandering opportunities to optimize their communication and improve their return on investment.

Marketing Technology Platforms: Enriching Customer Touchpoints

Marketing technology platforms play a crucial role in this process. They allow credit unions to use data on both the front end (to tailor marketing messages) and the back end (to measure performance).

This enriches all member touchpoints and transforms marketing from a necessary expense into a strategic growth initiative.

The Crucial Role of Executives and the C-Suite

For this transformation to occur, it must be front and center on the minds of executives and the C-suite of banks and credit unions. If they are stuck in the traditional world of marketing or merely giving lip service to digital marketing, then they can expect their financial institution to stagnate rather than grow.

According to BCG Research, more than 80% of the most digitally mature brands say that they have CEO sponsorship for data-driven marketing initiatives, whereas less than half of other brands do. Having the necessary enablers in place provides a foundation for making rapid, lasting progress and it should be no different for credit unions.

Conclusion

In conclusion, marketing is no longer just about promoting products or services. It’s about using data and technology to understand members and their needs better, deliver personalized experiences, measure performance, and drive strategic growth.

Credit unions that have ignored this new reality risk becoming irrelevant to their membership. On the other hand, those that embrace this new approach to marketing with the full sponsorship of their C-suite are well-positioned to thrive in the digital age and beyond.

Just as the connection between a well formulated digital strategy and outstanding performance of a financial institution makes intuitive sense, so too does a top-down well-crafted digital marketing strategy make way for strong credit union growth and increased member retention.

Preetha Pulusani is the CEO of DeepTarget, a FinTech company powering the digital communication revolution for credit unions and banks with Growth as a Service™ (GRaaS™) helping financial institutions grow by delivering amazing experiences that result in up to 10x more sales and lasting relationships with their digital users.