The multitude of banks in the area, coupled with industry consolidation, has allowed Boston-based Eastern Bank to hire those who already have a background in bank marketing.

Since deregulation, banks have become increasingly reliant on marketers and their strengths to capture market share.

Nowhere is this more important than in the Northeast, where consolidations and high concentrations of banks have made it increasingly difficult to not only differentiate one bank from another, but also make one appear ultimately more desirable than the other.

Marketing has become a science over the years and has become integral to the corporate structures of many banks – from the smallest, which usually outsource their marketing; to the largest, which use a combination of outsourcing and in-house staff.

According to a survey by the American Bankers Association, an increasing number of bank marketing executives will come from outside the banking industry. The survey found that of those marketers with up to two years’ tenure at bank marketing positions, 69 percent were from outside the industry. The percentages of those from outside the banking industry decreased as the number of years spent in the career increased so that of those with eight to 10 years’ experience, only 35 percent were from another industry. The survey was conducted to gather information on the need for the ABA’s Certified Financial Marketing Professional designation. According to Brenda Marlin, associate director of the ABA Marketing Network, the marketing background shared by the bulk of incoming executives presents unique challenges as well as benefits to banks.

Since deregulation and, more recently, the Gramm-Leach-Bliley Financial Modernization Act, banks have a broader arena to compete against – insurance companies, brokerage houses and others – so having a marketer who understands the principles of marketing and has the ability to present the bank in a way that reflects a highly retail-oriented economy may prove profitable.

Someone from the “outside,” said Marlin, can bring a fresh perspective to the bank. A new hire with a marketing background can bring “bottom-line results,” said Marlin. “If they’re just doing ads, they may not see that kind of bottom-line result, but if they are truly using marketing techniques and precepts when they’re doing their jobs … they can identify market niches.” That is done through research, customer segmentation and analysis of customer transaction patterns. With customer databases and other research tools out there for marketers, it is easier to prove their value by penetrating certain markets.

‘Key Component’

For the most part, banks understand the importance of having a knowledgeable marketing team, said Marlin. “I think it depends upon the size of the bank. Some of the smaller community banks, they tend to go toward the cute ad per se, but they are becoming more educated on what to expect from a bank marketer and what bank marketing is all about,” she said.

Alison Charello, director of marketing and public relations at Abington Savings Bank, has seen the attitudinal changes over the breadth of her career. “When I first started, I think that I saw people were [focusing on] banking first and marketing second,” she said. “Banks realize that the marketing role is very important to their business and to have marketing professionals is really a key component of their business plan,” said Charello.

Charello has found that when some staff members have a background in banking and others have a marketing background, they complement each other well. Both attend ongoing education, which is important in any field, she said.

At Boston-based Eastern Bank, however, Joseph J. Bartolotta, vice president of public relations and corporate communications, said the consolidation and multitude of banks in the area have allowed the institution to hire those who already have a background in bank marketing. “We’ve benefited tremendously from that,” he said.

“The most recent people we’ve hired have come from other banks,” added Bartolotta. “In the past two years, we’ve hired two people for our marketing department and they have come from larger banks.”

But Bartolotta said a banking background isn’t necessarily a must for marketing executives. “It always helps if you know the product you’re trying to sell well. But if you can sell computers, you can sell bank products,” he said.

While it’s not critical, it does decrease the learning curve. Bartolotta said one subtle but very important difference in bank marketing – as opposed to dot-coms, for example – is that despite a lighthearted approach, it is important the bank convey the feeling of safety, soundness and seriousness. These are features customers expect, he noted, and if a commercial crosses the line, then the marketing has failed.

Banks Becoming Increasingly Reliant on Marketing Science

by Banker & Tradesman time to read: 3 min