Tying it All Together, Marketing ROI and Digital Strategy
Before the advent of the digital age, marketing in many industries was often a shout out into the dark, a faint voice calling out at everyone and no one at the same time. Reach was limited, messages were monotonous and feedback came in the form of empty businesses. After the shock of the dot com bubble of the early 2000s, businesses rushed to get online, thinking that simply showing customers they were with the times was enough to attract customers. Fast forward to 2019, marketing has transformed into a multidimensional dialogue with consumers who seek round the clock communication with businesses and have access to vast amounts of information to analyze and compare. It is no longer enough to have a digital presence. If you do not have an integrated digital strategy that you can track, you are missing out on an opportunity and leaving money on the table.
Reports from McKinsey indicate that in the coming years, 50% of new revenues in the financial services industry will be generated via digital channels. This translates into a significant opportunity for forward-thinking institutions who can listen to what consumers want and provide the digital solutions they seek, but the ability to successfully take advantage of these opportunities rests on the ability to track results effectively and focus on value-adding services. This is where measuring Marketing ROI becomes critical. Like anything in business, you need to set goals beforehand that are trackable and actionable, and constantly measure progress, adapting along the way to maximize returns on your efforts.
For many years Marketing ROI has been seen almost as an urban legend or a hook telemarketers use to keep you on the phone. Financial institutions, in particular, have been skeptical of claims of Marketing ROI for two reasons. First, few people truly know how to measure it. Marketing metrics, in general, can be confusing for people with more traditional accounting and finance backgrounds and bad experiences have left a bitter taste in the mouths of many. Second, and equally important, conventional wisdom posits marketing as a cost center, an expense item on the income statement that can’t be avoided but should be kept lean. This viewpoint is limiting and misses the bigger picture of why marketing is important. An effective marketing strategy doesn’t subtract from the bottom line, it creates revenue that flows up to the top and, when done effectively, translates into bottom-line growth. It is past time to stop viewing Marketing ROI as some vague representation of dollars spent on marketing and start seeing it as a measure of how effectively you are connecting with potential customers.
How does having an effective digital strategy tie into the overall growth of the organization? One of the most powerful benefits of digital marketing is the ability to track your audience and gain an understanding of who they are and what they need. This will continue to be of increasing importance for the financial service industry in the coming years for a number of reasons. Rising interest rates, a real estate market that shows signs of early cooling and an uncertain economic outlook will cause downward pressure on mortgage and loan requests. The news is not all bad, however. Marketing research indicates that millennials, who purchased 37% of homes in 2017, will continue to grow their presence. In fact, over 8 million will be turning 29-30 this year, the prime age for buying a first home. While many will look to buy homes this year, many more still are misinformed about the homebuying process. Both of these groups could benefit from online engagement with financial institutions to guide them through the lending process. Nearly nine out of ten in this age group are active on social media, and interacting with them here allows you the benefit of tapping into a wealth of information about their habits. Armed with this information, banks and credit unions can tailor their digital strategy to reach profitable customers through cost-effective channels and drive sustainable growth.
The business world we inhabit today looks much different from the one many people entered years ago before the digital age. The sheer amount of information and technology available to companies can be daunting and trying to make sense of it all and determine what can help your business can be complicated. The good news is Strategis has a proven track record of success, with over 20 years of experience in the industry and a deep knowledge of the trending technologies available. Our expertise enabled us to deliver a 165% ROI over two years for a client. If you need help developing a marketing strategy to drive growth in your institution, the time to contact Strategis is now.
