Digital Marketing In Bank(Online Journal)

TOPIC: DIGITAL MARKETING IN BANKS

Ms. Madhuri Sanap

(Research Scholar at JJTU)

Contact No: 9867690645

E-Mail Id: [email protected]

Under the guidance of Dr. Kamal Tandon & Dr. B.V.Gaikwad

Abstract:

Where there was once delineation between banking processes that a consumer could do from the both the mobile and branch account opening experience.

With 70% of likely checking account applicants saying they would prefer to submit a digital application in 2015, it is clear that using digital functionality to improve the online, mobile and even the branch account opening process will eventually improve the on boarding and engagement process for new customers.

Unfortunately, there is still the challenge of abandoned new account opening processes because of lengthy applications, unclear directions, the lack of mobile-first design and the perception that branches have the edge when it comes to protecting personal data getting advice.

Surprisingly, most banks have not responded to this revolution in digital functionality. From hard-to-read screens comfort of their home or with the convenience of a smart phone and those that were done in a branch office, the use of digital functionality has finally become universal. No place is this more apparent than with the new account opening process, where features such as the camera phone OCR have improved to requiring signature cards and proof of identity at a branch, the process must improve. Even more surprising, while most banks offer online account opening, less than 20% offer a truly mobile new account opening process.

The 57-page Digital Banking Report, Digital Account Opening, focuses on the digital account opening (DAO) experience for checking accounts, and the landscape of solutions and workflows that comprise the end-to end account opening process. We focus primarily on account applications from new checking customers and include both self-service solutions as well as branch-assisted processes.

Keywords:

Mobile Marketing, Digital Account Opening, Workflows, Perception.

Introduction:

Simply, the term online marketing refers to using the power of Internet advertising to generate a response from your audience. Also known as Internet marketing or web marketing, online marketing is used by companies selling goods and services directly to consumers as well as those who operate in the business-to-business sphere.

Online marketing offers several benefits. It's convenient, affordable, and provides the opportunity for companies to track campaign results. Internet marketing allows even the smallest company to compete in a global marketplace.

• Social Media

 Social media sites include Twitter, Facebook, LinkedIn and Google+. Social media marketing utilizes these social networking websites as a marketing tool. The goal is to produce content that users will share with their social network to help a company increase brand exposure and broaden customer reach. One of the key components of social media marketing is social media optimization. This is a strategy for drawing new and unique visitors to a website, either by adding social media links to content, such as RSS feeds and sharing buttons, or by promoting activity through social media by updating statuses or tweets.

Social media enables a business to get direct feedback from customers. This interactivity gives customers the opportunity to ask questions or voice complaints and feel they are being heard. The other thing about social media is that it creates a “warm” database of people to whom you can market special offers and promotions.

• Email Marketing

Companies that use email marketing send promotional emails directly to customers. Developing a well structured email marketing campaign is a proven way to dramatically increase the effectiveness of your Internet presence.

You can choose to use your own email lists, or to add targeted "cold call" lists. Many email campaign management tools allow you to monitor and track all aspects of your email campaign. Getting the design right is a very important aspect of email marketing as it determines whether the email will be read and conveys the professional image of your business. The best practice here is to build a robust database that will enable you to segment your prospects and clients in order to provide targeted communication that best interests and appeals to them

• Website Content Marketing

From whitepapers, to videos and webinars, content marketing encompasses all marketing formats that involve the creation and sharing of content in order to engage current and potential customers. Content marketing subscribes to the notion that delivering high-quality, relevant and valuable information to prospects and customers drives profitable consumer action and improves brand loyalty.

Content marketers either share proprietary information with selected audiences, or they create new information and share it via different types of media, such as online newsletters, digital content, websites or micro sites, white papers, webcasts/webinars, podcasts, video portals or series, interactive online and email. The purpose of this information is to inform target customers and prospects about key industry issues, sometimes involving the marketer’s products. The motivation behind content marketing is the belief that educating the customer results in the brand’s recognition as a thought leader and industry expert.

• Online Ads

No matter what your budget, you can display your ads on Google and its advertising network. You pay only if people click your ads. You create ads and choose keywords, which are words or phrases related to your business.

When people search on Google using one of your keywords, your ad may appear next to the search results. That means you're advertising to an audience that's already interested in you.

People can simply click on your ad to make a purchase or learn more about you. Google Ad Words offers targeted reach, greater control over your ads as you can edit them and adjust your budget, and measurable value. There's no minimum spending requirement – the amount that you pay for Ad Words is up to you.

• Blog Posts

Blogs on news and industry sites are used to enhance a business’s marketing, branding or public relations, while providing the reader with valuable information and opinions on a particular industry or trend. A blog post should comprise an eye-catching title, in-text links to landing pages, banner calls to action, social sharing buttons, and a call to action at the bottom. Every blog post should be written in line with your overall marketing content strategy, so you should stay on topic and have your posts fit into the categories you’ve established. This type of communication is extremely useful in positioning the company and its key executives as thought leaders in their markets.

(bizconnect.standardbank.co.za ? Manage ? Marketing Tips)

15 Digital Marketing Strategies In Banks 2015:

The new year means new opportunities for financial marketers to help bring in more business for banks and credit unions. Consumers will be thrust to the forefront, as financial marketers focus on making meaningful connections with customers and members. At the same time, financial institutions will begin to differentiate from their competition by humanizing their brand, and delivering interesting, valuable information to consumers with a consistent voice that they can relate to.

• Getting back to basics with better branding
• Fitting the mobile experiences with responsible design
• Catering to the customer with mobile banking
• Pulling in the consumer via mobile banking
• Attracting more consumers with content marketing
• Making the most out of social media
• Promoting content with paid amplification
• Staying consistent with email marketing
• Telling visual stories with video marketing
• Appearing the contextual content with native advertising
• Optimizing and marketing for search engines
• Getting more personal and personalization
• Reminding the consumers to convert with retargeting
• Nurturing leads automatically with marketing automation
• Digging into big data & analysis

(thefinancialbrand.com/.../digital-marketing-strategies-for-banks-credit-u...)

Literature Review:

Since its growth in popularity in the late 1990s, IB has attracted attention of both academics and practitioners resulting in an extensive research quest to seek an understanding of how and why individuals choose to adopt or to resist IB. Consequently, a dominant part of IB literature has focused on the demand aspect or the process by which adoption or rejection occurs. This research stream has been studied through holistic and quantitative causal models and theories from adoption and diffusion literature which explain key dependent variables of interest, that is, behavioral intention to use and use. Behavioral intention is defined as “a person’s subjective probability that he will perform some behavior” (Fishbein and Azjen 1975, p. 288). Use is generally measured by the frequency, duration, and intensity of IB usage. The role of intention as a predictor of adoption behavior is critical and has been well-established in IB and IS research (Taylor and Todd, 1995).

IB behavior literature can be categorized into two main levels of conceptualization. The first approach attempts to understand IB behavior through the lenses of adoption and diffusion theories. They postulated that IB attributes are relevant determinants of attitudes towards the use, intention to use and actual adoption of IB. Although these theories address different aspects of the influences on behavioral change (i.e. IB adoption), they share the main assumption that an individual’s decision to adopt IB is not based on a single (one-time) event and the route leading to this decision does not take place in a vacuum. Perceptions, attitudes, and beliefs are formed over time, which in turn may influence decisions. The second approach focuses on the underlying resistance motives or barriers towards IB adoption using Ram and Sheth’s (1989) argument that people resist using an innovation by creating barriers at both functional (usage, value, and risk barriers) and psychological (tradition and image barriers) levels.

The section that follows will trace the progression of IB research focusing on nine specific theoretical models from replication studies to efforts at construct refinement and the search for an alternate theoretical mechanism that drives the adoption of IB. The aim is to comprehend whether any one of these theories, or a combination of theories, has resulted in a meaningful understanding of customers’ IB behavior.

Innovation diffusion theory                                                                                                       

Innovation Diffusion Theory (IDT), formulated by Everett M. Rogers in 1962, is the pioneering theory that laid down the primary foundation for the future of innovation diffusion research (Rogers, 1962). It was grounded in theories of economics, sociology and communication and a synthesis of adoption-diffusion literature across disciplines, IDT identified five characteristics of an innovation that influences its adoption: relative advantage, compatibility, complexity, reliability , and observability. Relative advantage (RA) refers to an individual’s belief that IB is better than traditional ways of banking and can be related to diverse economical, social, convenience and satisfaction dimensions of IB (e.g. convenience in the form of freedom from time and place constraints, efficient management of finance, a better overview of banking matters, and the speed of conducting banking activities). Research has identified RA as a major determinant of a customer’s intention to use IB (Tan and Teo, 2000).

Compatibility (CO) is an individual’s perception that IB is consistent and congruent with his or her existing understanding, values, needs and past experiences. It can also be defined as the fit between IB and the social and technological infrastructure of an individual. IB adoption involves acquiring a set of complementary technologies: familiarity with computers, Internet proficiency, and engagement with computer-mediated communications and transactions. The influence of one technology on the next generation of that innovation is expected to be positive especially when the relationship between the two technologies is compatible (Lee et al., 2005). In other words, willingness to adopt a new technology is affected by a prior adoption pattern of related technologies and a greater level of compatibility. This will allow the new technology to be interpreted in a more familiar context. Customers’ perception of compatibility with other electronic banking services (e.g., home banking, ATMs e-payment, and phone banking) and with the IB service medium (Internet) has been found to be positively related to their attitude towards IB and its usage (Puschel et al., 2010).

Complexity (CP) refers to the degree to which IB is perceived to be relatively difficult to comprehend and use. Although CP and CO are closely related, the distinction can be made that CP has more to do with the actual competence and skill involved in using IB, whereas CO manifests general perceptions towards IB use. Previous research suggests CP has a negative effect on the use of IB (Black et al., 2001). However, in contrast with these findings, Tan and Teo (2000) did not find any support for the negative influence of CP on intention to adopt IB. Furthermore, some studies using IDT framework, have replaced CP with the PEOU construct from the technology acceptance model (Koenig-Lewis et al., 2010; Puschel et al., 2010).

Trialability (TR) refers to the degree to which an individual perceives the bank to offer chances for him/her to try IB prior to any decision to adopt. A limited number of studies has shown that TR is an important factor for IB adoption as individuals will feel more comfortable with the technology and are more likely to adopt it if they are offered experimental low-cost or low-risk trial of IB (Black et al., 2001). On the other hand, Puschel et al., (2010) did not find a relationship between TR and IB adoption.

Observability (OB) is defined as the degree to which an individual can see the availability of IB to others and can observe others using the service. Rogers (1962) suggests that the more visible an innovation and its benefits are, the greater the likelihood of adoption, simply because the gains from adoption will be more easily recognized. However, most of the studies using IDT framework have either found OB to be of marginal importance in predicting IB behavior (Lee et al., 2004) or they have excluded OB noting that IB is mostly used in private settings and thus observing individuals performing IB is not only difficult, but also unacceptable (Keonig-Lewis et al., 2010; Tan and Teo, 2000).

IDT has been applied to study IB behavior either explicitly or implicitly, through its influence and integration into other theories. However, very few studies on IB diffusion explicitly measures the five characteristics as defined by Rogers and most suggest that only RA, CO, and CP are consistently related to IB adoption (Black et al., 2001; Koenig-Lewis et al., 2010). Black et al., (2001) pointed out that although IDT is a useful starting point to study IB diffusion, social issues and individual differences need to be incorporated into this framework to gain a better understanding of the phenomenon. Furthermore, Rogers did not identify the perceived risk of an innovation, but subsequently it has been found to be an important factor in explaining IB diffusion within IDT framework (Black et al., 2001).

Theory of reasoned action

The Theory of Reasoned Action (TRA), proposed by Martin Fishbein and Icek Ajzen in 1975, is a well-established social psychological model, which assumes that individuals are usually rational and will consider the implications of their actions prior to deciding whether or not to perform a given behavior (Fishbein and Ajzen, 1975). TRA postulates that an individual’s consciously intended behavior is a result of his attitude towards performing the behavior and subjective norm (SN), which is the overall perception of what family, friends, and colleagues think the individual should or should not do. In the context of IB, the more positive the attitude towards IB and the greater the perception of social pressure (SN) towards the use of IB, the stronger the intention to adopt or continue using IB. The application of TRA in studying IB behavior has been limited. Shih and Fang (2006) applied and extended the original TRA by adding network quality attributes (security, user-friendliness, transaction speed, and information quality) as antecedents of attitude towards the use of IB. They concluded that although the addition of extra variables does not improve the explanatory power of the original TRA, it did increase the explanatory power of attitude and behavioral intention.

Challenges In Digital Marketing(Bank):

The financial services industry is going through dramatic changes as a consequence of changing customer behavior, channel proliferation and the digitization of business and society in general. Cost reductions and increased sales do remain the key drivers, among others in retail banking.

The digital transformations taking place in finance are driven by many common challenges and opportunities across the industry, whether it concerns insurance, (retail) banking or other financial services.

At the same time, in each of those financial industry segments there are several specific challenges, depending on the digital transformation maturity level, the region, the overall ecosystem, the customer context (including the use of digital channels), the business scope and the degree in which digitization has taken place and processes have been connected. Although in some regions and countries, retail banks are leading in several digital areas, including marketing and customer-facing operations (with great examples of omni channel banking and mobile banking, for instance), in general retail banking still has a lot of catching up to do with many ongoing digital customer shifts, market evolutions and process change requirements. The speed at which it happens has to do with priorities (cost reduction, sales) and soloed structures.

Banks in general have additional challenges which we see in other segments of the financial industry as well:

• The need to integrate/connect distribution channels to optimize efficiencies, reduce costs and serve customers and prospects in a consistent way, the so-called omni channel imperative, which we have seen in retail and is typical for a channel-agnostic consumer.
• Some other key goals: better identify opportunities by looking at the overall customer life cycle (and important changes in it), improve experiences and (thus) enable better customer service and experiences.
• Reducing churn and increasing loyalty. The loyalty of retail banking customers fluctuates. This has to do with several other challenges mentioned below and overall changes in consumer behavior. Sometimes we see increasing loyalty, while in other areas loyalty decreases. Furthermore, loyalty is not enough anymore. Think experiences.
• Decreased levels of trust: the impact of the 2008 financial crisis and uncertain economies today had a well- known impact.
• Last but not least – there is the arrival of competitors with disruptive models that are better adapted to the increasingly digital consumer. There are also significant changes in the competitive landscape, depending on the region and context (e.g. the rise of Islamic banks in the Gulf countries).

Other Challenges:    

• Cost reduction
• Customer focus
• Single Customer View
• Developing new offerings
• Digital & Direct Marketing
• Segmentation
• Branch Consolidation
• Identify Silos
• The use of digital marketing & customer service strategies

Coclusion:

There has been an inexorable growth in online banking around the world, with penetration rates reaching over 80% of adults in some countries using online banking regularly. We are at an earlier stage of development in mobile banking, but given the ubiquity of mobile phones, and the fact that most banks will have a full suite of mobile banking services within the next few years, rapid growth here is also inevitable.

Many banks are therefore still at very early stages in terms of digital marketing capability – offline or online – but there are examples of banks who now have all the pieces in place to be leaders in digital marketing. This includes among other things having a real time single view of the customer, advanced use of analytics like predictive analysis, and the ability to deliver offers to customers in real time in multiple channels.

Social media is also now a significant part of the consideration in any digital marketing strategy. Can you imagine launching a product without a social media campaign, or not tracking what your customers are saying on Facebook and Twitter? The problem for banks is that, apart from a few modest developments, there seems to be a lack of direction to what happens The uncertainty level therefore remains quite high.

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