Power plug: A Wisconsin community bank wanted a low-cost but effective marketing campaign to promote its new internet banking service. (Feature).
Jack is a cute little cartoon character. His head is the plate of a telephone wall jack. The hole where the wire plugs in is Jack's nose. Two eyes are located above the nose and smiling lips beneath it.
State Bank's success with the Jack promotion is an example of how a small community bank can creatively market a new high-technology service in a simple, relatively low-cost way.
The bank's Internet service, known as eBank!, was introduced in May. By August, the bank had exceeded its original year-end projections for new customers.
To understand how State Bank formulated its campaign, you have to understand a little about the community in which it is located. Cross Plains was established in 1847 at the intersection of two major roads across the prairie. It soon flourished as an agricultural and retailing center. In 1920, the village absorbed two neighboring communities into a single municipality, the Village of Cross Plains, which, today, totals about 2,600 people.
The State Bank of Cross Plains is the big fish in this small pond. The bank came along in 1908 and has been there ever since. Today it boasts assets of about $230 million and is the second-largest employer in town.
But times change. The small agricultural village of the 19th century became, in many respects, a bedroom appendage of the city of Madison, the state capital and home of the mammoth University of Wisconsin. As the larger city to the east continued to expand, Cross Plains residents found employment in the Madison metropolitan area, and Madison residents found new homes in Cross Plains.
With this growth came new competition for State Bank. So far, says assistant vice president Janis L. Vandermeer, the community bank has managed to compete successfully for mortgage loan and commercial accounts, but retail banking is "a bit more of a challenge."
Many customers have Internet access
Changing times led to changing demographics. As the computer age began to flourish, Madison successfully wooed technology firms to the area. State Bank of Gross Plains discovered that it had more than the average number of computer owners in its retail base, and that a substantial number of those computer owners also had Internet access.
The bank had been offering banking by home computer since 1996, but it required a direct modem-to-modem connection. Internet banking seemed to be the wave of the future. Vandermeer estimates that 85 percent of the bank's competitors offer it. It was clearly time to join the party.
Last spring, the bank installed phone line connections for its Internet banking processor, designed its Web pages and finalized its customer agreement, security and signup procedures.
The rollout was scheduled for May, the same time as the rollout for a new electronic bill-paying service. Vandermeer says the staff decided early on that their primary audience would be the bank's own retail customers. Although Cross Plains is a small community, it is located on the fringes of Wisconsin's second-largest statistical marketing area--nearly 1 million people. There is a weekly newspaper in the village, but the big dailies are in Madison, as are the major broadcast media outlets. Advertising in the larger Madison media would be both expensive and wasteful. Dane County, in which Cross Plains is situated, has a population of more than 400,000 people, but the bank's market includes fewer people than that.
As a consequence, the bank concentrated marketing efforts on direct mail letters to current PC banking customers, users of Telebank (the bank's telephone access service), customers with e-mail addresses, direct deposit customers and current loan customers.
Direct mail solicitations explained the benefits of eBank! and the electronic bill-paying service. The letters emphasized that both services were easy to use and that Internet banking was free to customers. The letters, signed by assistant vice president Scott Stewart, noted that the fee for electronic bill paying ($4.95 a month) would be waived through the end of the year. The solicitations also included a return envelope so bill-pay users could print out the bill-pay application and return it to the bank.
Developing the concept
The bank did not retain an advertising agency, but it worked closely with a design firm, Michele/Thomas/Hutchins of nearby Waunakee.
Several marketing themes were considered. Since the bank would be opening a new branch in West Madison (its first in the city) in August, one proposal contemplated announcing "two new offices--one in your home and one near you." Another suggested headline: "Gain immediate access to your account by punching your banker," with an accompanying illustration of a computer keyboard.
"Jack" was the survivor.
The introductory mailings read: "We'd like to introduce your new personal banker, bill payer, loan officer and teller.. . "Jack."
The accompanying illustration made it clear that "Jack" was a telephone wall jack.
The bank supplemented the direct-mail campaign with in-lobby displays, which featured a large doll wearing an eBank! polo shirt and a mockup of a telephone jack for a head. A literature rack in the doll's lap contained informational fliers about eBank!, the bill-pay service and the various discount offers. Employees were also outfitted in eBank! polo shirts. Internet banking terminals were installed in the company's five branch offices.
The bank's website offered a link to eBank! as well a demonstration module that permitted prospects to familiarize themselves with the program.
Drink coasters promoting the Internet service were passed out at community parades in the bank's marketing area. To encourage bill-pay signups, the bank offered free one-month Internet access as well as a $50 discount on Gateway computers.
The promotion was an immediate success. State Bank originally planned to achieve an 8 percent penetration of retail checking customers--about 500 customers--by the end of 2001. By the first day of August, 482 customers had signed up. As a result of the enthusiastic response to eBank!, the bank revised its objectives. Now it hopes to have 725 subscribers by year-end.
One of the keys to the program's success was employee training. A month or more before the rollout began, all employees were exposed to special product training. When their training was completed, employees were expected to use the Internet service and were encouraged to use the electronic bill-paying service as well.
That exposure made it easier for employees to understand Internet banking and made it easier to sell, says Vandermeer.
"It's just a matter of getting people to try it," Vandermeer says. Once they were familiar with the product, they could sell it with enthusiasm.
Employee incentives were also offered: a 5 percent discount on Gateway computer purchases and a year of interest-free financing, waiver of the fee for bill-paying service, and a grand prize drawing open to employees who had made a sale of Internet banking and bill-pay services. The chances of winning were directly related to the number and value of the sales.
By October, Vandermeer says, about 265 eBank! subscribers had resulted from employee referrals.
The promotional campaign received recognition at the ABA's School of Bank Marketing and Management in June, where it won the students' choice and judges' choice awards, One bank marketing student described the promotion as unique, consumer friendly and well thought-out, with a strong retail approach. "It was very professionally done," she said, "with a character and personality of its own."
The bank continues promoting Internet banking through cross-selling to new accounts and through regular customer newsletters and e-mail messages.
Vandermeer says the bank had hoped for 200 retail checking-customers to sign up for electronic bill-pay services by the end of this year. Here, the promotion was less successful; only 122 had signed up for bill paying by August. Possibly customers were put off by the longer application forms for the bill-pay service. And other banks are staffing to offer fee-paid bill paying (as opposed to a fixed monthly fee), a strategy that Cross Plains Bank may have to adopt.
Vandermeer said the total expenses for the initial six weeks of the campaign were under $14,000.
And Jack earned every penny.
Clyde Linsley is a freelance writer based in Annandale, Va.
RELATE ARTICLE: The Care and Feeding of Internet Banking Sites
Internet banking can be a valuable means of reaching your customers, says Brenda Marlin, associate director of ABA's Marketing Network, but "you can't just stick it out there and leave it." Internet banking requires a Web presence, and a successful Web presence requires serious thought, careful planning and regular--and timely--maintenance.
A few tips:
Make it interesting. It hardly seems necessary to point this out, but Web pages are harder to read than are printed pages on paper. Too many pages of gray, unbroken text are a good way to chase your customers to another website--at some other bank.
Keep it fresh. The World Wide Web is a handy vehicle for delivering up-to-date information almost instantaneously. Take advantage of the Internet's immediacy and post news about interest rates or special offers as soon as possible. And if your Web maintenance is outsourced, make sure your Web host is on board and prepared to move quickly when you need it.
Make it easy. Computers are getting faster all the time, but not everybody has a fast one. Many of your customers may be relative neophytes when it comes to downloading. Engineer the process so that it's as simple as possible.
Make it fast. Graphics are nice, but on a slow-moving PC they can seem to take forever to load. Keep graphic devices simple for the sake of those customers who don't have the lightning-fast processors. If you do have a lot of graphics, consider providing another option--perhaps a text-only option--for the slowpokes.
It's worth your while to make Internet banking as attractive as possible, Marlin says. "It costs less per transaction to deliver on the Web than any other way."
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|Title Annotation:||State Bank of Cross Plains, Wisconsin|
|Comment:||Power plug: A Wisconsin community bank wanted a low-cost but effective marketing campaign to promote its new internet banking service. (Feature).(State Bank of Cross Plains, Wisconsin)|
|Publication:||ABA Bank Marketing|
|Date:||Dec 1, 2001|
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