Reshaping BFSI Marketing Strategies

Naved Qureshi, Senior VP & Marketing Head, Jana BankNaved has been associated with Jana Bank for over three year now, prior to which he has held key position across renowned brands such as LOTTE Confectionery, Sify, Landmark Group, Lifestyle International, and Reliance Trends to name a few.

It is hypothesized that we are at the threshold of the ‘Fourth Industrial Revolution’ an era of exponential technological breakthroughs poised to fundamentally change the way we live, work, and interact with one another. Needless to say, every industry, every sector, and every business must adapt and evolve their models to incorporate these advancements in order to stay relevant and witness growth. The world is expected to transform more in the next 20 years than it has in the last 300, which means that no industry or business can rest on its laurels or rely on traditional and conventional growth models that have allowed them to flourish so far.

The BFSI industry is no exception. Dramatic changes are disrupting the financial services industry, fundamentally transforming the way financial products are structured and delivered. For instance, the lending function as it was structured is no longer sustainable. Banks and NBFCs are responding to the change by offering pre approved, instant loan sanctions online, without the need for cumbersome paperwork and long waiting periods. The digital revolution has facilitated a massive shift in consumer expectations, necessitating quickly adaptable product designs to meet ever-evolving demands.

This is also apparent if one studies the marketing function within the BFSI industry. Financial service providers can no longer expect loyalty by default. They have to constantly reinvent themselves the conduit for which is their marketing efforts. It’s not only imperative that they innovate new products and services, but also strategies and channels through which they market their products. With an explosion of options available to customers they have no qualms in moving from one provider to another based on what's the most convenient efficient and costeffective for them. The task before financial providers therefore is not just to build & earn a loyal customer base, but to retain loyalty through constant innovation.

BFSI industry has responded well to this new challenge, crafting and reshaping marketing strategies & distribution models. In many ways, the marketing efforts of financial service providers mimic the brand building efforts of the FMCG industry, fostering customer relationships and enhancing customer experience by establishing emotional connections and humanising their communications. Here are six crucial trends that are likely to dictate marketing strategies for the BFSI industry, most of which are already being leveraged by businesses in various capacities.

1) Data-driven Marketing: Today, the world has access to tools and technologies that didn’t exist perhaps even a decade ago. Where only mountains of unorganised data existed, we now have the tools to streamline, analyse and leverage this data. Financial institutions must leverage advanced data analytics to glean the most critical insights that inform their communications. Insight driven marketing has the power to drive exponential growth, build strong customer relationships & customer loyalty, acquire new customers, and enhance overall profitability.

2) Personalisation: Perhaps the most powerful use of insights powered by advanced data analytics is personalisation for customers. Customers increasingly want to see hyper personalised, hyper relevant content that seems tailor made for them they expect their service providers to know and offer exactly what they want. Providers can attract and acquire customers through curated content communications that target or are personalised for a whole segment will not work. Customers will remain loyal to a brand that learns their behaviour, preferences, and requirements, and is quickly able to adapt to them in terms of how the provider communicates, what services & products it offers, and even how these services are delivered. Hyper-personalisation is perhaps one of the most crucial marketing trends that financial providers must embrace. Part of this also is innovation in the voice and vernacular spaces allowing users to interact in their own language and voice commands. These efforts will take BFSI marketing to deeper to more customers.

3)AI & Predictive Banking: Machine Learning (ML)and Artificial Intelligence(AI) arguably the conduits of the so called Fourth Industrial Revolution are also the mediums of disruptive overhauls in virtually every
industry in the world. While predictive analytics is already used in banking, for assessing the credit worthiness of customers, for instance, it can also be utilised within the marketing function. Data mining and AI are crucial for the aforementioned hyper personalisation for customers, analysing massive amounts of data to build predictive profiles for individual customers. This can then be used to personalise communication. AI and ML are also indispensable in greatly enhancing customer interactions with a provider and customer experience in general, and it’s therefore imperative for financial providers to have a dedicated AI strategy in their marketing and distribution efforts. AI and ML can be leveraged in marketing in several ways, and it’s a chance for providers to get creative. For instance, these technologies can be used to understand customer intent through their digital activities and behaviour which was previously only available through search histories and automatically link intent with appropriate offerings. AI can help curate and customize content for individual users, and also offer products and services matching their needs and preferences, making for unparalleled customer experience. Another example is AI assistants and chatbots that are becoming increasingly sophisticated and mimicking human interaction. These are the next big frontier in customer service, and financial providers must integrate these technologies into their marketing efforts. ML can significantly enhance the quality of these chatbots that can be trained to field and solve customer queries(not just predictable ones) in a manner that is personalised and engaging.

Social media is not only a great platform to showcase new products, but also a space where financial providers

4)Digital Marketing:While even a few years ago, banking without physical retail branches would have been unthinkable, today financial institutions are increasingly focused on delivering products and services on-the go through websites and mobile apps. It obviously has been prompted by increasing internet and smartphone penetration. The ongoing digital transformation in the country is expected to increase the total internet user base of India to 829 million by 2021 (from 604.21 million as of Dec’18). Marketing and sales efforts are proportionately allocated from offline and mass media channels to digital marketing strategies such as:

a)Mobile Marketing: The mobile channel is crucial, given that a majority of customers use their mobiles to access information and carry-out financial transactions. Many financial providers now have a comprehensive mobile marketing strategy aimed at engaging and informing their customer on-the-go. Mobile strategies are of particular significance in tapping new markets in India, given the high level of mobile penetration and poor levels of financial inclusion in underserved areas. In a recent interview with ET, the global CEO of Western Union, Hikmet Ersek did mention that India is one of the four largest markets, and Western Union is investing heavily on enabling payments digitally. To add to the value of targeting mobile, he went-on to say that people’s behaviour is changing and retail is getting slower growth and account payout and digital payout(and Wallets) is growing like a rocket.

b) Content Marketing: Through SEO content and other strategies, content marketing is fast becoming one of the most effective and preferred methods of engaging, acquiring and retaining customers and building brand loyalty through meticulously targeted content. Does the website have a hub that features blog posts infographics Q&As and other rich, useful content? If not, the content strategy might be missing out on a big marketing opportunity. Not only should you be marketing with content, but a sound content marketing should also include videos. It’s important, for example, for a bank to show stories about the people it serves and the communities in which it operates. Tapping into this resource and making the most of the power that show don’t tell’ holds.

c) Display Advertisements: Another type of marketing that’s unique to the digital space, display ads are still or video advertisements that appear as banners, boxes, pop-ups, and overlays on third party websites. These are also extremely data driven, where financial providers can tap into potential customers by placing ads relevant to them on specific third party pages that they are likely to visit often.

5) Social Media: No marketing strategy is complete without a comprehensive social media vertical. Providers are moving to mainstream social media channels Facebook, Twitter, Instagram, or LinkedIn where both room for content experimentation and potential for acquiring new customers is vast. Social media is not only a great platform to showcase new products, it’s also a space where financial providers can leverage celebrity and influencer endorsements that are likely to be hugely impactful for younger audiences. Social media is where businesses can most effectively build a credible brand identity and maintain high visibility. And that’s not it platforms like Facebook also boast of enabling marketers with tools to sustain business growth. In one of the ad-vertorial, it touches upon consumers expectation on convenience, speed, automation and simplicity along their online purchase decision and journey. Facebook’s Zero Friction Future(ZFF)claims to simplify consumer journey and enabling business growth for instance case in the study is that of leading Auto players (Maruti, Hyundai & Royal Enfield)that have also turned to Facebook to boost sales.

6)Multibranding & Partnerships: A long standing favourite with FMCG businesses multi branding is a strategy that amongst other things, can be quite effective at defending market share. Financial service providers are increasingly employing this strategy as part of their evolving marketing efforts particularly with a suite of digital products offering competing services under one umbrella targeting diverse market segments and audience in order to capture a larger market share. Last but not the least is to find and enable partners to work within the ecosystem. Whether a hospital or realestate agency CAs, Media Houses, the whole idea is to align yourself with other businesses that can help you bring in new businesses and customers.

There’s strength in numbers, after all, especially when it comes to marketing strategies for banking. Be it fostering customer relationships and enhancing customer experience or partnership aka Cooperative marketing help the financial organisation build new relationships and it help find new markets, like home buyers who need to take out loans or the parents of young children who are looking to start bank accounts and so on and so forth.

BFSI is living in the interesting and evolutionary times and glad to see marketing assume more than it traditionally did and evolve rapidly!