7 Reasons Banks Fail at B2B Direct Marketing
Banks are spending big money marketing products and services to small businesses via direct mail. As the owner of a marketing consulting business in Cleveland, Ohio, I regularly receive mailings for business checking accounts, loans, lines of credit, and merchant services.
Most of these direct mail campaigns are terrible. Here are seven reasons why so many banks fail at B2B direct marketing and some lessons for your smart marketing strategy.
Three Banks, Three Examples of Lousy Direct Mail
How bad is the direct mail banks are sending to small businesses? Check out these three examples I recently received from banks serving the greater Cleveland market:
- Bad address, worse copy: Bank A’s first mistake in its direct mail package for business term loans was using an extremely old and never-accurate mailing list. The mailing was addressed to “Gean Gianfagna” at an office address we left seven years ago. The copy (and my so-called “VIP code,” apparently meant to make me feel special) made the bad addressing even worse: “At [Bank A], we understand how passionate you are about your business. That’s why we make it our job to know you and your business, inside and out.” Um, except when you’re trying to get me to become a customer.
- Bad address, no follow-up: Bank B got my name right on their direct mail package, but used the same seven-year-old mailing address as Bank A. Bank B’s letter promotes business checking and merchant services. The signer says “I will be contacting you soon to see how [Bank B] can help you and your business.” I’ve never heard from him or his bank.
- Decent copy, poor formatting: Bank C, a major national bank, writes a solid direct mail letter offering a business line of credit but fails to apply the time-tested formatting rules of effective direct mail:
- The lead paragraph is four sentences long and six lines deep;
- The offer and call to action don’t appear until the third paragraph;
- The deadline (the timeframe during which they’ll “honor your pre-qualified status”) is buried near the end and mentioned only once;
- The letter font size is too small;
- There’s no P.S.;
- And like Banks A and B, Bank C mailed to our seven-year-old address.
7 Classic Direct Marketing Mistakes Banks Keep Making
All these approaches reflect fundamentally flawed B2B direct marketing strategies. Here are seven ways these marketers went wrong:
- Everyone uses the wrong data. Where are these banks getting these mailing lists? How is it possible that the address on each direct mail package is so outdated?
- Everyone misses the opportunity to properly use the data. Not only is the direct mail misaddressed, but if a bank did any kind of basic data analysis of their rented files, they could tell just from the address that I’m a woman business owner, a company president, in marketing, and in Cleveland, Ohio. No one references these data points in any way to personalize the mailing to me or make it more relevant.
- Every campaign is a cliché. The copy either flatters the business owner on their success (“As a business owner and expert in your field…”) or uses trite, overused copy lines like “You need a bank that works as hard as you do.”
- No one really writes to ME – the real Jean Gianfagna who’s been a business owner in Cleveland for more than 20 years and who’s already in a long-term banking relationship. Does anyone actually know me? Or anything about me?
- No one addresses the real business issue: Switching business banks is a big deal. Have you ever switched business banks? It can be a complex undertaking. These campaigns fail to make the case for switching or assure business owners that the bank can make the process relatively painless.
- The future relationship is missing. Business owners want and need one-to-one relationships with their bankers. As an established business owner, I have that relationship already. If you want me to give that up, it would be smart to tell me who my new banker will be and why this person is qualified to do a better job than the banker I have now.
- The proof – an example from a real business owner – is missing. Send me a letter from a fellow business owner who chose to switch to your bank and is willing to explain why. Make it even more relevant by making the author a Northeast Ohio business owner.
The Takeaway for Smart Marketers
The proven principles of effective marketing never change, including the principles of direct mail marketing.
All the golden rules about direct mail that I learned 30 years ago as a young advertising copywriter – write for the reader’s interests, format the letter to make it easy to read and scan, don’t bury the offer, and most important, address the mailing correctly – still apply today. Banks using direct mail to sell to small businesses could dramatically increase the effectiveness of their mailings by following these rules.