“Replace Fee Income with Free Checking.  Really”

I had to read the above headline several times to ensure I wasn’t misreading it.

As a long-time advocate for free checking I was initially stunned by this headline.  Even more shocking is that it appears atop a June 22 article on the American Banker website.  It was written by John Rountree and Scott Kluge – principals at the Cambridge Group, a growth strategy consulting firm.

Just when I thought the much aligned free checking account was on the ropes, it finds its way back into the ring to go another round.

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Do you know how to construct a true and effective direct marketing letter? Maybe you think you do. But do you know there are three parts to a proper direct marketing letter? I’ll be there are many financial services marketers who don’t.

Creating an effective letter for a marketing campaign is different from the way you write a business letter or a personal letter — or other types of marketing materials. Many years ago, this was the formula I was given for these special prospecting letters:

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Finally, in Sunday’s newspaper I encountered a credit union ad where the headline offers not one, but two, major benefits.

For the past couple of years, my local credit union has been aggressively marketing its low rate auto loans via several marketing channels including newspaper ads and billboards.

Here’s a typical newspaper ad with a rate-only headline. Read more…

“I’ve just never wanted to go to the effort of changing banks.”

I took that quote from Steve Topper’s blog post he wrote last week, “Sticking with the Mega-Bank.” It’s an example of a typical answer Steve gets when he asks people why they don’t switch their accounts to community banks and credit unions even after the mega-banks raise fees, slap on onerous account requirements, and even foreclose on their mortgages.

Referring to this special class of people, Steve ended his post by writing, “Forget the switch kit — apparently it doesn’t work that well.”

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I’m perplexed by many things in life – one of which is why so many homeowners who were duped or conned by one of the mega-banks continues banking there.

Occasionally I’ll ask a friend or acquaintance where they have their checking account and, with few exceptions, they almost always mention one of the four mega-banks.

When pushed as to the reason why, the answer is generally the same – “I’ve just never wanted to go to the effort of changing banks.”

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Some of you are probably too young to remember a book called How to Lie with Statistics. I still have the copy I bought when I was in college. The title of the book popped into my head when I read two news stories, both based on the same Direct Marketing Association report.

The DMA analyzed data collected from over 29 billion promotional emails and two billion online ads. The organization compared the response rates from those promotions to response rates already gathered for direct mail and telemarketing.

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Finally, a Free Checking ad appears in a Sacramento weekly.

Or is it?

There for a while I was worried that the mega-banks and their friends in Congress had succeeded in scaring community banks and credit unions away from offering and promoting free checking.

It seems the legal waters have become seriously muddied by tossing in the Federal Trade Commission Act’s UDAP section and stirring it vigorously with the onerous Dodd-Frank Act.

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You’re probably wondering why you should read a blog post that tells you how to sabotage your projects. You have people who do that for you. (Sabotage, I mean, not read.)

Well, if you can identify tactics and methods that doom or damage a project, then you can act to prevent them from doing their worst. (And of course, you want your co-workers to read this because they’re the ones who need to see it the most.)

So here are 11 tactics (better than a top 10, less than a dozen) I recommend you avoid…

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This could be a typical comment made during the weekly marketing meeting at your local community bank or credit union.

“Hey, we’ve tried everything to get more of our customers to use our online bill pay service.  We’re currently at 37% penetration and would like to hit the 50% mark by the end of the year.  Does anyone have any fresh ideas how we can accomplish this?”

It’s at a time like this when someone in the marketing department gets the courage to offer the ultimate solution – “Hey, let’s try a sweepstakes.  Nothing else seems to work.”

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When something works, it might change its appearance to keep up with the times, but the idea will continue to be used. That’s true of an old standby, the advertising envelope.

If you’re a philatelist, you call them advertising covers or illustrated covers.

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Here’s a bit of irony for you.

It appears that the community banks and credit unions in my area have totally abandoned direct mail in favor of the social media channels.  In fact, they appear close to abandoning newspaper ads as well.  Newspaper ads in the Sunday edition have become as scarce as hen’s teeth, pocket calculators, and landline phones.

Most likely they are busy throwing all their marketing dollars into trying to make Facebook and other social media channels work for them.  I’m still fuzzy about the merits of having hundreds, if not thousands, of people on Facebook “like” your bank or credit union.

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How much does it cost your financial institution to open one new account?

Last week, I wrote about the Tell A Friend program. It wasn’t my first post on the topic. It seems a TAF program is an inexpensive way to open accounts and get new customers/members. But I’ve heard banking executives, even some marketers, disagree.

The big mental block they all seem to have is the premium. Yes, you give TWO gifts for one account opening. Somehow, these program opponents equate that idea with flushing away money.

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One of the hottest banking topics these days concerns the future of the branch.  Are they becoming obsolete?  Will they be downsized?  Will they take on a completely different look and feel?  How many will be consolidated and closed?  Will they be put to a different use?

Bottom line – there is a lot of uncertainty as to what to do about today’s massive number of very expensive brick and mortar branches.

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I would never use “dirty” words in my sales copy. I’m sure you wouldn’t either. Yet some marketers (or their cronies) seem to have distorted ideas of what words are acceptable in their marketing materials.

Let’s begin by stating a copywriting rule you should follow. Write your promotional copy (and all your customer communications) in a conversational style. After all, you’re supposed to COMMUNICATE your message. Long, obscure words might impress the board members and make you look (allegedly) smart, but they don’t communicate well.

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I’m convinced that every so often bank and credit union marketers believe they’ve run out of product offers or other sales messages yet have marketing dollars that must be spent.

The end result is the occasional newspaper ad or billboard that causes me to shake my head and wonder “what were they thinking?”

Here’s a case in point.  This newspaper ad appeared in last Sunday’s issue of The Sacramento Bee. Read more…

A customer Tell A Friend program, also called Refer A Friend, is a proven technique that opens many additional checking accounts. In essence, it turns your customers/members into a sales force for your bank or credit union and the only compensation it costs you is a few dollars for each gift.

But some financial institutions turned the idea into an inequitable program that can’t be as successful as they hope.

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As a marketing professional, you should always look for a new promotional angle. Another way to make your financial institution stand out in the public mind. Here’s an idea that might lead to a promotional campaign for your bank or credit union.

Apparently, working for community financial institutions is advantageous to your health. Seems that way because two ACTON Marketing clients are promoting their wellness awards. One bank won a statewide worksite health award and another earned a gold-level workplace award from the Wellness Council of America.

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