P&G’s decision to complement targeted segmented marketing through social media with more broad-based tactics will come as no surprise for banks.
September 29, 2016 | Research- P&G have decided to complement targeted social media marketing with more broad based tactics
- Leading banks have been adopting both broad based and targeted social media marketing for some time
- The right digital marketing tactics appear to be linked to customer experience outcomes
Marketing departments in retail financial services have been moving an increasing portion of their budget to digital initiatives in the last decade, targeting their marketing spend on search, email and social media options. It was suggested that deep data analysis of digital channels would yield greater levels of personalisation and eventually better returns compared to the traditional 2-5% reply rates netted from email and letter marketing approaches. This thinking was reinforced by customer segmentation approaches adopted by banks where individual segment portfolios were targeted for improvements in customer service rather than the one size fits all approach previously used.
Therefore the recent announcement by Procter & Gamble that it has taken targeted and segmented marketing on Facebook too far, concluding that the practice has limited effectiveness, raises a number of questions; how much is too much and how personalised should digital marketing become?
To emphasize, P&G will not abandon targeted digital marketing where it makes sense but the company admitted that putting all bets on this one approach does not work. Marc Pritchard, P&G’s chief marketing officer, said that he will not cut back on Facebook spending and will employ targeted ads where it makes sense, giving pitching diapers to expectant mothers as an example. It is also important to highlight from the conclusions of the P&G statement that a company of its size and type of business can increase sales if they reach a more significant portion of a platform’s overall audience. Moreover, as reported, P&G recently increased its television spending, supporting the trend that any form of video advertisements via traditional or social media outlets continues to significantly impact consumer purchase decisions.
Banks are applying both broad based, one size fits all and narrow, targeted marketing approaches depending on the context.
For OCBC Singapore, targeting strategies remain an important approach to reach the most relevant audience with the right message but not in all circumstances. “There are times when we want to achieve wide brand or product awareness and consideration rather than direct acquisition, or to drive traffic to a specific platform. In these cases, close targeting can be a disadvantage as it narrows the target audience to small segments, and it would not help us to expand and grow the market,” said Dennis Tan, head of consumer financial services Singapore, OCBC Bank.
“Targeted marketing on Facebook has worked well for us. What we do is identify core audience characteristics for our service offerings, and then leverage Facebook’s targeting strategies to deliver the right message to the right audience. For example, we tune our messages for specific products to targeted audiences - parents for our Mighty Savers products, and youths for FRANK by OCBC products. This has yielded responses or engagement five times higher than broad-based marketing,” Tan explained.
ASB New Zealand, which has successfully leveraged social networks for lead generation by engaging their audience in genuine two-way conversations, has found Facebook an effective way to connect with its customers and community as high profile social networks such as Facebook are checked very frequently.
“We run a systematic jam-packed content schedule at ASB and therefore it is essential to use targeted marketing for some content rather than the more traditional ‘spray and pray’ marketing methods,” said Simone McCallum, ASB’s head of social media. “Our approach is to look at the objectives of the campaign or communication in conjunction with the content, and determine whether a broad audience is appropriate or whether a targeted delivery would be more effective,” she added.
“We’ve had successes with both (types of marketing) and a key factor is understanding the wider customer experience, and whether the targeted audience will have interacted with our brand on other digital touch points before or after they interact with us on social media. For example, if they have been sent an email from us where the call to action is to visit our website page, then the Facebook post needs to take that into context and help them along the next step of the journey. Targeting allows us to deliver more relevant content to the people who will be more interested in it, and therefore we are more likely to have a higher return on our marketing spend,” McCallum explained.
Conclusions
What can marketing executives in retail financial services draw from this given the P&G statement?
While social media marketing investments will continue to rise as an overall portion of the marketing budget, the P&G statement does not suggest that the bigger the brand, the more broad based the media should be. P&G has indicated that they will revert back to a more balanced approach which the best players in the retail financial services industry already practice.
ASB New Zealand highlighted that any approach depends on previous marketing exposure so understanding the wider customer experience is certainly helpful to identify the right marketing tactics. Banks will no doubt want to continue to strike a balance between mass reach and personalized targeting that sits well with digital and synergises with video.
Categories:
Financial Institutions, Retail Banking, Technology & OperationsKeywords:Procter & Gamble, OCBC, ASB, Digital Marketing, Facebook, Social Media
