Web throws up challenges for top marketers: experts at Australian Banking & Finance Magazine's recent CMO Panel Discussion—sponsored by Google—agree that while online is the way of the future for promoting their brands the more traditional ways of marketing are here to stay

Australian Banking & Finance,  July 15, 2008  by Andre Khoury

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Australian Banking & Finance Magazine's CMO Panel Discussion saw five of the Financial services industry's leading marketing experts participate in a robust and entertaining debate.

They included: Mark Buckman, Chief Marketing Officer, Commonwealth Bank; David Morgan, Chief Marketing Officer, HBOSA BankWest; Paul Riley, Head of Marketing & Strategy, Cards, ANZ; Howard Silby, Chief Marketing Officer--Retail Banking, National Australia Bank; and Vic Wolff, Executive Director--Marketing & Communications, ING Direct.

When asked what the preference for a bank was--either to sign up a customer in a branch or online--Morgan said a bank needed to keep customers' needs as the number one priority.

"A lot of businesses use technology and channels to make their business successful," he said. "There's nothing wrong with that but I think you can lose the heart of the customer in doing so. Some customers will be ready for change and some customers will want to be acquired in new ways.

"But at the same time there are those who are not ready for it and are not prepared to do it yet ... we don't want to leave those folks behind.

"The difficulty we've got as marketers is we've got to get very smart in so many different ways and in so many different channels. It was much easy when the web didn't exist because we never had these conversations ... it's getting much more complex for us as marketers, it's getting much more complex for the customer, but I think if we put our needs ahead of the customers we will always lose."

Silby said: "Our preference would be sign up in the branch but at the same time they're signed online. It's only in the branch where we have our wealth experts or our small business experts that you start to get a sense of the true expertise that the bank can provide. It's very hard to convey that in an online environment.

"As our customers migrate through their lifecycle and move to running small businesses or move into having wealth needs, then that relationship with the store is absolutely vital."

Wolff conceded that as a bank without the traditional shop front there were people ING Direct would never be able to reach, unlike the major banks which can target those consumers who prefer to visit a local branch.

"But that's a strategy we've chosen on purpose," he said.

"I think from a consumer perspective, especially when a product is simple and accessible and easy to understand, who would want to walk into a branch? I can imagine for the more complicated matters you'd want to walk into a branch and talk to face-to-face with somebody.

"But for the simple matters--everyday banking, savings accounts, and even consumer loans and credit cards--why would you walk into a branch?"

Buckman highlighted that CBA has more 1000 branches "with 60 per cent of our customers using branches as their primary channel".

"It's really about channel preference and being able to serve up the right mix of products and services in the right channel," he said. "In addition to that, we've got three million customers in NetBank. We look at NetBank and the NetBank environment as our single largest branch, and the experience in the online environment has to be equal to or better than the experience that you are actually getting in the branch environment."

Are online statements the way of the future?

Morgan: "If we're moving it online because it's what is best for our business, to make our business profitable, then we're not serving our customers correctly. We really should be thinking about the customer and we should be really thinking about what the best customer service is that we can provide rather than what our bottom line looks like...If people want statements electronically then go ahead and do so, but if there are customers that want paper statements, then give them paper statements."

Buckman: "There's been a massive take up of [CBA's] online option only and people turning off their paper statements. So there's a considerable move already."

Why do banks continue to spend dollars on mailing out marketing material?

Riley: "There is still a remarkable amount of customers who won't do it online for whatever reason won't take it from telemarketing or don't want to walk into a branch but will respond to mail. And even more remarkable is that some customers actually fill out the application and send it back in the mail."

Morgan: "It comes back to the fundamental point that the customer is responding to those pieces of paper. Some customers are much more comfortable doing that than others."

Web 2.0--transcending the ages or just a Gen Y phenomenon

Buckman said the online environment was going beyond Web 2.0 and "embracing where Web 3.0 is actually going in terms of using things like artificial intelligence and contextual searching to actually build a much more dynamic experience with customers". "Web 2.0 is certainly something that many of us here are actually well involved in, but it's where to go to from there. And it's certainly not just a Gen Y phenomena," he said.