Helping an African penguin celebrate its second birthday at the New England Aquarium with a $200,000 corporate sponsorship are: (from left) John Hamill, chairman and CEO, Sovereign Bank New England; Joe Campanelli, bank president and COO; Jerry Schubel, aquarium president; and Dyan deNapoli, penguin aquarist.
Free rides on the MBTA, savings bond giveaways for newborns and a personal appearance with a penguin are just some of the publicity-generating events that Sovereign Bank New England has undertaken of late.
Since entering the New England arena last year, Sovereign has been hammering away, attempting to tear down the wall between being viewed as an unknown bank and the local community bank.
John Hamill, chairman and chief executive officer of the bank’s New England division, explained that the overall marketing strategy for Sovereign highlights its involvement in the community, education and principal events. There are, however, certain aspects of the marketing strategy the $34 billion-asset financial institution reserves for the New England market.
When Sovereign opened its doors in June of last year, it purchased MBTA rides for morning and evening commuters. To celebrate its anniversary, the bank has offered $100 savings bonds to all newborns who were born in its footprint area on June 19 and sponsored the Mapping Boston exhibit at the State House.
“We think it’s working well. We’re 1 year old here in Boston, as you know … Since February, we’ve opened 55,000 new [checking] accounts. That’s a great start to that campaign and to our presence here in New England,” Hamill said of the Totally Free Checking product it began offering this past winter.
Attracting so many checking accounts to Sovereign is one measure of the success of a marketing and public relations campaign according to Wayne Texeira, co-president of the Bank Marketing Association’s New England chapter and vice president of marketing at East Boston Savings Bank. It is one of the more difficult types of accounts to attract, he said.
“Often, most consumers identify the bank that they have their checking account with as being their primary financial institution, so they’re certainly trying to establish core relationships,” he said of Sovereign.
In addition, the small business and commercial loan business has grown 8 to 10 percent, said Hamill. “I believe it’s fair to say that one year after coming here, that Sovereign’s name is becoming associated with a bank that cares. It cares about its community. It cares about its customers and it cares about its team members. That’s the message that we’re trying to get across, and I think it’s working,” said Hamill.
‘Personal Touch’
Sovereign measures the success of its endeavors not only by the number of new accounts but also through internal surveys, call center complaints and inquiries. “It’s a whole series of tests that we use in order to try to keep our finger on the pulse,” Hamill said.
According to Texeira, marketing and public relations trends are cyclical. “You’re certainly hitting a big cycle right now of free checking. A few years ago you heard a lot about free checking, then it dwindled, and now you’re hearing more again about free checking. You’re seeing a lot more of the ‘giveaway’ type of strategy that you may see get poked fun at by some of their competitors as well,” he said. While companies understand that a free gym bag or other product isn’t enough for the majority of consumers to switch their accounts, it is another way to get noticed, and sometimes that’s the goal.
The giveaways are an effort to show customers that Sovereign appreciates their business, said Hamill.
It’s also a way to capitalize on the nostalgia trend that is hot in today’s marketing, said Texeira. There was a time when banks gave away appliances such as toasters and, today, people like to remember that simpler time, even if it wasn’t simpler, he said. “As with anything, there are the ebbs and flows of what’s a hot concept in marketing. Sometimes those things catch on,” he said.
It’s been only a year since Sovereign first entered the New England market but its marketing strategy has evolved, said Hamill. In addition to its free checking product, Sovereign has undertaken a direct marketing campaign that cost the company in the neighborhood of $12 million.
“Direct marketing, direct mail has been a big part of the campaign and that is different from when we first came to town,” said Hamill. The value of direct mail, he said, is in putting “very detailed, very specific” information in the hands of customers to compare the cost of services directly with those of competitors such as Citizens Bank of Massachusetts and FleetBoston Financial.
Texeira said the direct marketing campaign has been “very aggressive” in going after new accounts, but overall the bank still has some work to do.
“My perception is that they’ve had some difficulties in getting recognized,” he said. While the name is recognizable to most consumers, Texeira said there is still an unknown variable when it comes to identifying what the bank stands for and whom it represents.
For that reason, Hamill has undertaken a task that is usually reserved for community banks under $100 million: a plethora of personal appearances.
He’s been photographed holding babies and standing beside penguins. He’s made himself very accessible to the press and public. “We think that being on the scene personally does have an impact and make a difference. You’re able to connect with a large number of team members [i.e., employees] as well as customers. I think it provides a more personal touch. We are a bank that prides itself on the ability to act like a small community bank, notwithstanding the fact that we’re the 25th largest bank in the country,” he said.
That can be very confusing to consumers, said Texeira, who suddenly find that nearly every bank, despite its size, is calling itself a community bank.
“I think it has more to do with the philosophy of being involved in the communities that you serve. I think that smaller community banks traditionally do a better job of it,” he said.
“I think being visible goes a long way. Sovereign’s done a decent job with what they’re doing … You’re seeing them being a lot more active, because they’re able to shift some of their focus from operational issues to more strategic and marketing issues,” said Texeira.
But with all the “fun” events, Sovereign has to walk a fine line, said Texeira. “Gimmicks can go a long way into generating recognition and recall,” he noted, but if people remember the commercial but not the brand, then it hasn’t done its job.
“People choose a financial institution [to care for] their most personal and important asset – their cash and their finances. While certainly the consumer has a sense of humor and appreciates all the different types of fun advertising you see out there, there is a line that can be crossed between good taste and bad taste,” he said.
Sovereign has been careful to back up the publicity-generating photo opportunities with substantial programs such as the Beach Teach program for underserved local preschool children, which takes place at the New England Aquarium. Alongside the personal appearance with Roast Beef the African penguin, Sovereign presented a $200,000 check for the program.
Community involvement through education and sponsorship of events like the Jimmy Fund walk and minor league baseball teams will continue, said Hamill, because it has been working for the bank. The free checking product also will continue to be a major focus of the campaign.
The bank allocates $30 million to $35 million on marketing and public relations. About half of that is reserved for the New England market, said Hamill. In-house personnel share the duties with LevLane Advertising-PR, which is based in Bala Cynwyd, Pa.; and GPC International, which has offices in Boston.
