Wasted Advertising Dollars
Banks shouldn’t spend one more dollar on advertising. That is, until they can get right.
Currently, banks are simply wasting their money until they can figure out a powerful and relevant brand promise so emotional and meaningful that it would actually cause someone to go through the hassle of switching banks.
Certainly, banks have spent millions of dollars on advertising trying to persuade consumers to switch. It may be heard to imagine, but Bank of America actually has a larger market budget than Budweiser.
However, bank marketing has been so off the mark that it might actually reinforce many of us to stay with the bank we already have. Simply put: Banks don’t give anyone a reason to switch even when we want to.
What a waste of money
Banks have spent millions to advertise things like “free checking.” Super Free Checking. FDIC Insured. A safe place to keep your money. A better place to save.
They need take their own advice: Save your (advertising) money, if that’s the approach they’re taking.
The last time most of us checked with our bank, things like free checking, being federally insured and “safe place to keep your money” were considered table stakes – the cost of doing business if you are a bank.
Yet advertising agencies have convinced banks to squander millions on extolling table stakes disguised as viable reasons to switch. It’s like a restaurant advertising that they have clean dishes. Clean dishes are to the restaurant business as free checking and safety is to the banking industry. It’s non-negotiable. You’d better offer these things or you won’t be in business very long.
Why in the world are banks so quick to spend money to advertise the same things that all other banks advertise? Is it because the market leaders do it, so everybody has to do it?
It is an old story
It seems since the beginning of time that we’ve suffered through lame bank advertising – and it’s gotten worse. Since the bailout crisis began, we’ve been exposed ad nausea to even more mundane bank advertising that simply markets values most of us believe we already have.
Bank of America is the market leader in the U.S. and, for them, marketing “table stakes’ is a strong defensive position. When everybody in the category says the same things, consumers default to the market leader. It’s when the rest follows that inertia sets in.
Let’s consider BB&T. The nation’s 14th largest financial holding company, BB&T bank advertising likes to remind us that they have been in business since 1872. However, stability is another one of those values bank customers already believe they have from their own bank. It simply doesn’t matter.
What really matters
Consumers are more interested in what banks are going to do for them tomorrow, not what you did in the past. Hint: And it is not free checking. More importantly, customers want to know what who they will be – which part of their self-identification will resonate with the brand.
BB&T’s strategy is a perfect example of an inside out approach, spending money on advertising to talk about your company but never about the potential customer.
How unhappy are you with your current bank? Do you remember all the hoops you had to jump through to open up your bank account in the first place? It has to be done in person because they need your signature and they want to inspect your IDs. You have to move your money. Order new checks, change your direct deposit, change all the online bill pay accounts you currently use today, get new ATM cards. The list goes on and on. It’s extremely time consuming.
Who amongst us has disposable time we don’t’ know what to do with? And for those of us who have time on our hands, we have zero intention of spending that time on something as excruciating as switching banks. Especially switching to a bank that is promising me exactly what I currently have today. It’s not going to happen.
So banks – please stop advertising now. Save your money. Figure out what is important to the consumer and build your brand around who the consumer is when they choose a bank.
Most importantly, it has to be actually compelling enough to move consumers past the point of considering switching to actually doing it.
The good news is that once consumers switch, they don’t switch very often again. We know the reason why: No one gives a reason to switch again.