What Message Is Your Marketing Sending About Building A Customer Relationship?

Not all business development ideas are the same. Nor is the marketing around those ideas, especially when it becomes part of a global business collective of competing interests, simply trying to out-do each other on the same type of promotion. While several ideas can foster a creative way to drive an effective R.O.I., there can be just as many ways to upset the applecart of the business model entirely. Simply by misreading the audience. Or by gifting them into business, thereby making the transaction nullified by what efforts it took to receive that business in the first place.

Another thing to factor in is whether those creating marketing opportunities actually live by the standards of the consumers they are supposedly attempting to attract. Sports does this by giving free tickets or trinkets away on certain games, then wondering why the audience never yields into revenue later. Yet, the hard costs of facilitating those customers through free ticket promotion push, realized through additional staff, is never justified by the marketing team who came up with the idea originally.

This happens in other industries as well. I recently received an e-mail from a bank. It offered me $200 in cash, interesting me enough to read further. The offer stated that all I had to do was place $15,000 in liquid assets into the bank’s savings account for 10 days, and the $200 would be mine. Oh joy. Because I have $15,000 in cash, lying around. I'm probably not that target demographic for that deal, but I started questioning who exactly was.

Does The Marketer Relate To Their Customer?

Marketing folks have the ability of getting ahead of themselves when creating some promotions. Especially when they giving away product. Or trying to create a cause and effect reward, without truly understanding their customer base. This happens in everything, not just banking. It happens in politics consistently, which is why candidates tend to receive hard target debate questions aimed at revealing whether their thoughts are in line with the voting public.

Consider the key U.S. presidential question tends to be asked of the candidates, at some point, during each general election: What is the price of gallon of milk?

Why would a presidential candidate need to know that factoid as much as foreign policy? They aren’t buying their own milk. Nor is the United States at a point where dairy is scarce or affecting the country. Yet, it is a specific question about tone-deafness by each candidate. A milk sits on the majority of kitchen tables in America each morning, and knowing that a gallon goes for $3.09 in the local grocery store speaks to reliability with the candidate’s constituency.

A version of this came up in the 1992 U.S. Presidential election, where on a campaign stop, incumbent George H.W. Bush apparently marveled at a technological wonder in a grocery store. The check-out scanner. Something that had been a part of American life since 1974. The story that was generated, whether totally true or hyped up into an urban legend, did not play well with the voters, who saw Bush as “out of touch.”

That got me thinking about who came up with this banking promotion, and whether they truly understood who they were attempting to target. Are there several people with $15,000 in cash, who are motivated by a $200 “bonus” reward, by switching banks in order to collect? Banks are in the relationship business, or used to be, so what does a promotional “bribe” do to build a relationship? Maybe that’s a failure of the bank’s marketing team to see that.

The Marketing Reality Distortion Field

This draws back to the main issue of who is generating the marketing efforts, and who they think they are trying to attract. Sometimes, the marketing team brings failed general notions about reality and the life of the consumer.

While I’m making a fairly good income at my current position, I don’t know that there are that many people who have $15,000 in liquid assets who are typically motivated by $200. Let alone to change the banking relationship that they already have, for a $200 “bribe” for a bank that they may not have an extensive relationship with.

This is where the promotion meets a reality distortion field that even the late Steve Jobs would be envious of. Consider who likely came up with this promotion: Banking executives who have $15,000 in liquid assets, or more, with the ability to move their assets around to create a deposit. Essentially, they aren’t trying to make a banking relationship with the customers who take them up on this opportunity. They are instead attempting to generate more “deposits” with high enough values to meet certain goal measurements. If the yield is 500 accounts with $15,000 or more in deposits for a 10 day period, that’s $7,500,000 in new business generated. Enough to show high volume on the books for the quarterly report and employee pooled bonus structures.

Institutional Bottom Feeding

But what does that really do for the end role of the institution and its customer? There is little to no relationship there. Just a transaction, a deposit, and likely a competitive promotion for that same customer to withdraw their assets from the current bank gimmick to the other. Such as another bank e-mail that I received, offering me $500 in cash if I opened up a bank account with $50,000 liquid assets deposited. At that one only offered $50 for a $5,000 liquid asset deposit, and only $100 for a $10,000 liquid asset deposit.

It reminds me of something famous radio executive Randy Michaels once told an audience of programmers. That if one station is doing 9 songs in a row, you can do 10, and the next station is 11. But really, after a while, aren't you forgetting to play commercials, pay the bills, and have a reason for customers to listen to your specific station altogether? It goes beyond simple marketing, and how making the customer relationship deepen with the brand is more important than just being able to out-do the competition on giveaways.

Let's say that there are customers out there who are positioned in order to do this. And they continue to make a mad rush, for 10 day periods, going through the process of setting up savings accounts to deposit that sort of cash, merely to withdraw it 10 days later. While the short-term gain has been made, how negatively does it impact your consistent customers, who aren't a part of this promotion? Is this creating longer lines, wait times, or bad customer service simply to snare customers who won't be banking with you in less than 15 days from when they opened their account? Short-term gain may show some profit on the books, but can create chasms of negativity with those who have been consistently loyal to your brand.

I’m waiting for the next competing bank to send me an e-mail, who will create yet another sliding scale. Especially one where they think I can afford to move $100,000 in liquid assets to a savings account for 10 days. I'm hoping that there is at least one person out there, who is able to take advantage of all of this, and has gone through all of the hoops these banks are setting up, and generating $200-$500 every 10 days by taking their money out and depositing it in another bank with another promotion. Aside from the plus/minus increase on the tally sheet at the end of the quarter, does it really work toward something? Or does it merely stave off the reality that instead of marketing, the gifting process has just created a group of customers who only value your business as long as you are paying them to through a promotion. And once that promotion ends, exactly what customers do you have?

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Troy Kirby has helped generate revenue for three college athletic departments and professional teams. Owner of The Tao of Sports, which focuses on Sports Sales & Revenue Analytics, Kirby has interviewed over 600 sports executives for a three-times per week podcast and writes daily about sports business, including the secondary market. Founder/President of NAATSO, the only college ticket association, as well as the creator of The Sport Sales Boot Camp. Kirby is also a frequent contributor to The Association of Luxury Suite Director's quarterly publication, SEAT Magazine, and Ticketing Today.