What Banks Can Learn From the World's Best Retailers

"Social selling is still selling. It’s just another tool in your toolbox.” -Jody Guetter

When banking professionals hear the term “social selling,” they cringe. Somehow it sounds too out-of-bounds for the traditional world of banking. Why is this the case?

Jody Guetter,  executive vice president of market innovation for Nymbus Labs, a strategic marketing and innovation unit of NYMBUS, recently joined the Banking on Digital Growth Podcast to discuss the interrelationship between brand, data, and social selling. She was previously the chief marketing officer at Social Assurance and has a background in working for luxury retail brands, which helps inform her innovative digital viewpoint.

Digital Transformation and the Future of Banking

If you picture digital transformation, you’re probably thinking about technology. What tools will we use for transformation? How will we revamp our website? What’s new with our mobile app?

But transformation is about much more than technology. It’s also about the transformative growth it takes to move forward. This involves training, education, and cultural changes.

It’s about the people, not just the tech.

Jody comes from a sales and marketing background in high-end retail, working with luxury brands like Chanel, YSL, and Dior. She also has a background working for a major bank. And while in her role as CMO at Social Assurance, she tapped into her dual background in marketing/banking to provide expert insights and advice.

She sees a wide range of trends in the retail world that the banking world hasn’t been able to duplicate. One of the most glaringly obvious? It’s the retail market’s focus on providing an outstanding customer experience. This is particularly true with luxury brands, which place a high value on giving the customer something they can’t find anywhere else.

Until recently, most U.S. banks didn’t give much thought to the customer experience. They might have given lip service to the idea that the customer was important, but they didn’t change their way of doing business due to customer desires.

In the past few years, a dramatic shift has been happening. Banks are becoming uneasy about new entrants in the marketplace that are intensely focused on the customer experience. Suddenly things like branding, data and analytics, and customer service research are top-of-mind for banking executives.

The Opportunities and Challenges of Social Selling

Even as banking professionals struggle to adapt to the issues listed above, another concept comes to the forefront: social selling. It’s an idea that strikes fear into the hearts and minds of traditional bankers.

Social selling means getting involved in the digital world and connecting with customers online. It’s a casual type of customer interaction that feels off-kilter for someone who has deep ties to the traditional world of banking.

Even worse, from an old-fashioned banker’s point of view, is exploring the idea of user-generated content. Customers contribute things like reviews and experience videos, building the base of online content about your brand. But banks don’t love the idea of putting people in charge this way.

Great brands are willing to relinquish a bit of control for the positive tradeoffs. Social selling helps you build more loyalty. People trust you more. You have more online reviews. Plus, you’re finally speaking the same language as your audience.

Although this type of connecting with customers is difficult for banking professionals to accept, it’s effective. It’s like a virtual handshake that builds rapport with an audience you’ve never met before. It’s just another tool in your toolbox that should be used whenever needed.

No Room for Secrets in Modern Banking

Many banking brands think they’re doing a better job of communicating with their customers than they are. They also think they’re telling the whole world about the good things they’re doing, but they’re not.

Are you doing community and philanthropic activities? That’s wonderful! But don’t keep it a secret. Brag a little, because your customers want to hear about it. This should become front-and-center in your marketing because it’s extremely important, especially to a new and younger generation of banking customers.

Jody has interacted with banks and credit unions that tell her, “We’re the best-kept secret.” Why would any brand want to be a secret? It’s a failure of marketing. You should be shouting your messages from the rooftops.

Authenticity is also an important part of modern branding. People can smell a fake from a mile away. Don’t sound like a commodity or like every other faceless corporation in the world. Allow your brand to sound original and authentic.

Niche Banking and Connecting to a New Generation

Snapchat’s research study about financial services and decision-making delivered some interesting results. For one thing, it showed that 18 to 24-year-olds are very interested in financial wellness and literacy.

How are you connecting with this concept as a brand? Are you reaching this young audience that’s so interested in their financial well-being? This also speaks to the question of niche banking and niche positioning.

Niche banking is about deciding who you are as a brand and putting significant resources into connecting directly with your niche audience. For example, what if you were the Bank of Gucci? What would a Gucci bank fan love about your brand?

Having a clear viewpoint is also important. The Snapchat study found that 50% of Gen Z-ers are less likely to buy from a brand that promotes issues that oppose their own. Is it possible that your brand represents things a Gen Z customer would see as oppositional to their views?

Maybe you could connect with a new audience over the issue of stress. Study after study finds that most people in most age groups struggle with stress as a daily factor in their lives. Nobody wants to live in poverty. Banks have an opportunity to ease the financial stress people are facing by introducing the idea of financial wellness.

It all comes down to understanding human behavior and being able to connect with people on a human level. Chanel and Gucci understand how to do it, and that’s why they run billion-dollar businesses. Banks can learn a lot from these intensely customer-focused brands.