I am currently at the BAI Retail Delivery Show, which is an annual conference for those who sell retail financial services to consumers (translation: Banks and Credit Unions). The tagline of this year’s conference is “Reimagine Retail Banking“, and digital marketing guru Gary Vaynerchuk was tapped as the person to walk on stage and help an industry that doesn’t exactly traffic in “imagination” engage in the process of reimagining retail banking.
For those who don’t know about Gary, here are the key facts:
- Immigrant child who exhibited more entrepreneurial zeal before he was ten than most of us show in a lifetime.
- Used the nascent social media space to grow his family wine business from $3M per year to $60M.
- Was an angel investor in Facebook, Twitter, Tumblr. Is also invested in Uber.
- Runs a digital marketing agency, writes books, consults, and does presentations.
The apparent cultural chasm between new-world Gary and old-world bankers may have seemed fairly vast at first, but after a series of informal polls he conducted, the chasm may not be all that great. Key points from his talk:
- His provocative question: Are you marketing in the same year in which you are living? He’s not anti-television, radio, billboards, or print. He simply thinks they’re overpriced based upon their cost, which is artificially propped up by companies making advertising decisions based upon old ROI models and a “that’s the way we’ve always done it” mindset.
- By show of hands (in an audience I would peg at 2,000 or so) we determined that the vast majority of us….
- Watch our favorite programs when we want to.
- Fast forward through commercials.
- If we have to watch a commercial “because the remote fell off the bed and we can’t reach it”, then we look at our smartphones and scan social media activity instead of watching the commercial.
- Won’t knowingly click on a banner ad.
- Look at our smartphones when we’re walking, riding (and driving, in some cases) and therefore deny outdoor advertising most of the impressions they’re touting.
- Aren’t going to race home after the conference to “go through the direct mail”.
- Are on Facebook (“for those of you who are not, your horses are outside to bring you home”)
- Are “annoyed when someone calls” (e.g. an unplanned call with no pre-call texting).
- Yet we…..
- Keep the same ad spend, and when we tell ourselves that a small sum for digital marketing has been set aside, it’s way less than adequate. “When a company has an $80M television budget for the year, and has $150,000 reserved for social media, that’s just condescending”.
- Think banner ads are a part of a digital engagement strategy.
- Don’t market the same way we live because we cannot create an ROI that satisfies old management practices.
- Ignore the fact that digital is more accurate and easier to track than print.
- “Call customers on the phone to sell them shit” despite the fact most admitted that they themselves don’t like getting phone calls.
Gary is clearly a big Facebook fan and said that Facebook has target accuracy in the 90% range, while banner ads are closer to 20%. Why is Facebook so great? Because we don’t lie about our age on Facebook (our high school friends would hassle us), our gender and our alma mater.
Story: Sales for Nilla Wafers were flat, and the parent company came up with an experiment to ditch the old practice of spreading media dollars around and instead focus all of their spend on social media. They knew that the representative buyer of Nilla Wafers was a
- Living in the south
- Putting wafers on cakes
Once they tested and retested different “voices”, they found the one that worked and then “pounded” the moms “into submission”. Flat sales increased by 9%.
One last thing for the bankers: he ended the Q&A session by throwing aside their concerns about regulation and how it can limit what they do/say. His point:
- Bankers are lucky since virtually everyone needs what they sell.
- Banks are already on social media (albeit underutilizing the opportunity).
- He has customers who are in the wine business and have limits placed on how they can market.
- He has customers like Hasbro who have limits placed on who they market to.
- Conclusion: there’s nothing holding bankers back from marketing in the age in which they live.
That’s my recap. For those of you (most of you) who are NOT bankers, I expect much of this applies to you as well. Hopefully this recap will provide you with some food for thought.