Customer-centricity: a new marketing revolution

Direct Marketing Association President & CEO John A. Greco, Jr. shares with you the latest techniques that savvy financial marketers employ for success.

Turning over one’s livelihood to a financial services institution requires something of a leap of faith. Most of us recognize this fact instinctively as consumers, but it bears repeating because of the far-reaching repercussions for our businesses.

You see, few customers – whether individuals or businesses – are able to make that leap on merit alone. In addition to being confident in a provider’s ability to deliver, they want to feel good about their financial partners.

For this reason, financial services professionals simply cannot underestimate the importance of looking out for customers in everything they do. And marketing is no exception.

Marketers wield tremendous power to shape positive experiences and perceptions of companies. It’s a tough job, but one that pays dividends – literally. The good news is that technology is raising the bar for interactions with customers and prospects and, along with it, our companies’ bottom lines.

As the leading trade association for organizations using and supporting multi-channel marketing, the Direct Marketing Association (DMA) sees evidence of this every day. We are pleased to be at the leading edge of a new marketing revolution – one placing customers at the center of the marketing process – and to share the following best practices with FST readers.

Relevance rules

The secret to successful marketing is to reach the right customer with the right offer at the right time – a fact driven home by DMA’s recent eight-part Consumer Response study.

In our examination of consumer interactions with direct marketing, we asked US consumers to record all of the direct marketing they received for two days, and then record why they did or didn't respond. At just over 24 percent, “not the right time” was the most often cited reason for declining an offer. This was closely followed by “lack of relevance” at 23.6 percent.

You might wonder what companies can do to take these considerable obstacles out of the marketing equation. Without a crystal ball allowing us to peer into the hearts and minds of customers and prospects, the answer lies with sophisticated customer intelligence and analytics systems that mine data, leverage complex statistical techniques, and make predictions about behaviors and propensity to buy.

Using such systems, marketers can hone in with unprecedented accuracy on what customers and prospects want and need – and then deliver by generating highly personalized and timely solicitations.

This type of relevance-based marketing is exciting for several reasons. First, its ‘intelligence’ is constantly evolving according to actual marketing results, thereby creating increasingly effective future campaigns.

Second, high-powered analytics are not just for big businesses anymore. Small- to medium-sized enterprises are now finding innovative ways to overcome traditional barriers to entry, such as the need for large data volumes and high start-up costs.

For businesses that use a franchise model, such as some accounting and insurance firms, there is an emerging opportunity to tap into the economies of scale associated with franchise networks to bring the costs of analytics down to small business levels. This is great news not only for the businesses themselves, but also for their current and prospective customers.

Test, monitor, and optimize

The more things change, the more they stay the same. So it’s little surprise that the fundamental tenet of direct marketing is more relevant than ever before for meeting customer needs in today’s multi-channel environment. Whether deploying a direct mail campaign or launching an integrated initiative spanning various on- and offline channels, marketers must test, monitor, and optimize.

James Brett, vice president and business head of the eBusiness Development Group, Prudential Financial and chairman of DMA’s Financial Services Council Operating Committee, says this is critical to marketing at Prudential or any large corporation – not only in managing individual campaigns but also in maximizing the effectiveness of the company’s search marketing efforts.

A key goal for any customer-centric marketer should be to ensure customers and prospects can quickly and precisely find what they’re searching for. And this is no easy task. With internet users’ search habits constantly evolving, the keywords and search placements that worked five years – or even five days – ago may or may not be relevant today.

Since search engines and other web-based marketing vehicles offer results in real-time, there is a tremendous opportunity for marketers to continually test new techniques for driving web traffic. Brett recommends testing keyword purchases, for example, based on newly launched campaigns or by tracking query frequencies through search engine tools. Then track the results and optimize purchases to ensure you’re connecting with web users in their language.

While you’re testing keywords, don’t forget to think outside the box. According to Jon Kaplan, Google’s vertical head of financial services and the digital thought leadership chair of DMA’s Financial Services Council, there's significant potential for companies to make search marketing more targeted by purchasing keywords and ad placements for local searches and life events, such as moving, starting a new job or having a baby. I find these developments particularly exciting because they allow marketers to fine-tune search engine placements and/or web advertising according to distinct customer needs.

Get inside the customer’s head

Many of today’s marketers know almost too much about their businesses, making it easy to forget what it’s like to be a customer or prospect navigating a complex web of marketing materials. The symptoms of this type of end-user amnesia range from copy written in ‘company speak’ to a lack of appropriate educational content or calls to action, and dead-end web navigation – none of which bode well for customer-centric marketing.

I cannot stress enough the importance of incorporating user feedback into the marketing planning process. In addition to using the “test, monitor, and optimize” approach to assess whether marketing is on point, you can work wonders with focus groups, online surveys, capturing call center comments, and implementing robust web metrics and analytics systems.

Prudential’s James Brett recommends constructing personas – research-based representations of a company’s target customers – to keep marketing focused on its end user. Once personas have been defined, companies can carry out targeted analyses, such as use cases and customer journey mapping, to ensure each customer touch point is equipped to direct users toward desired outcomes.

Whatever the approach, companies should be vigilant in identifying and addressing marketing dead ends, particularly on the web. If you’re finding common pages where users’ trails run cold, consider whether you have offered effective calls to action – and not just the ones you want the customer to take, but the ones that are best suited to their individual needs.

Keep it simple and seamless

Many companies today work very hard to build high-powered, multimedia marketing machines with lots of intricate parts that are carefully engineered to move in concert.

But here’s the irony: Though customers appreciate the greater selection of marketing vehicles associated with a multi-channel marketplace, their expectations for simplicity and expediency haven’t changed. Customers don’t want to be bothered with what’s under the hood of your marketing machine. They just want to know that when they step on the accelerator – whether by visiting your web site, sending you an e-mail inquiry, or calling your customer service center – you’ll be able to take them from Point A to Point B in a timely manner.

On a practical level, this means companies must have systems in place to track and manage leads across their many marketing channels. They must be able to distribute leads to appropriate parties quickly and effectively.

For those financial services providers where the field sales channel plays a key role in establishing customer relationships, a centralized routing system is especially important. Great pains should be taken to share information about prospects with agents or sales representatives in real-time, and to provide instant access to sales and marketing tools, regardless of the field representative’s location.

And, of course, don’t forget that marketing today is a two-way dialogue. Enabling sales representatives to record and transfer information about customer interactions back to central marketing databases allows companies to truly understand individual needs and how they change over the course of the customer lifecycle.

Respect customer preferences

This last point is critical – a sure-fire way for customers to tell whether or not companies are sincere in their customer-centricity. And I don’t have to tell you how important it is for financial services companies to get it right.

Perhaps more than any other industry, financial services has experienced firsthand consumers’ widespread concerns about data security and privacy. You’re probably also aware that the consequences of ignoring customer preferences go well beyond jeopardizing individual relationships. Ethical breaches and customer information misuse could easily pave the way for suffocating legislation that would undermine companies’ ability to deliver relevant marketing – precisely the type of communications that customers want and need.

For this reason, DMA and its members are committed to leading the marketing community by example. We offer comprehensive resources to help companies ensure compliance with existing regulations, such as the Gramm-Leach-Bliley Act.

We also regularly liaise with lawmakers to educate them about the important differences between personal data (such as Social Security and credit card numbers) and marketing data (information based on shopping habits and purchase history), sanction ethical violators who tarnish direct marketing’s good name, and advocate best practices for respecting customer rights through self-regulation.

Why do we do it? And, more importantly, why should you consider joining us in making a commitment to customer-centricity? In short, because acting in customers’ best interests is in the financial services industry’s – and your company’s – best interest, too. That is the bottom line.