Contacting account holders used to be simple. Financial institutions (FIs) sent letters, and if they wanted the account holder to return something, they included a reply envelope. In fact, even in a "paperless" universe, most consumers still receive offers through the mail. FIs have also relied on print or TV advertisements, but in the modern world, FIs have access to more contact methods than ever to reach their account holders.
More contact methods available today
Now, options for communicating with account holders and prospects abound - each with pros and cons. The contact methods generally depend on the content of the communication and the target audience. Some popular options include:
- Traditional mail
- Statement stuffers
- Radio and television advertising
- Telephone calls
- Facebook posts
- Website posts
- Social media advertising
- Skype and other face-to-face electronic methods
Today, innovation also abounds. For example, the Larky Nudge® platform communicates with account holders at the right time and place. Built into an FI's mobile banking app, the Larky Nudge® platform highlights services for account holders at relevant locations, based on their individual needs. It presents real-time on-screen notifications so that account holders know when an opportunity is in front of them. This convenience enhances user experience and helps FIs reach their audience with ease.
Traditional contact methods
Today, while as much as 90% of direct mail gets opened, and the response rate is climbing, that rate is still only between 5 and 9%. So, if the goal is to get a response, mail may not be the best method. It's not cheap either. The market today features a cost of $0.50-3.00 per piece. Statement stuffers present similar problems, even though more than half of Americans still receive paper statements.
Television and radio were once great media, and they can still be useful for targeted audiences. But again, costs for a broad audience can be high and responses can be low. Similarly, telemarketing has as low as a 1% success rate on cold calls.
Email and texts
Email and texts can be extremely cost-effective. However, only an average of 18% of emails get opened (much less read) and only 2.7% get a click-through response. Texting has a much higher open rate and an astronomically higher response rate of 45%. Texting and emailing are also far cheaper than most other contact methods.
FIs can use social media to post information and place advertisements. The major sites today include Facebook, Instagram, Twitter and LinkedIn. Of course, those preferences change rapidly, particularly with a younger audience. Having a company social media page can be an inexpensive tactic. However, paid ads on these sites have the added advantage of allowing for an immediate response.
It is simply no longer possible to be a successful financial institution without a website. Most consumers will look for a company's site, and most are turned off by a poorly designed or user-hostile one. Website costs, with many services available to help, can be reasonable for creating this essential business asset.
The coronavirus has introduced everyone to online face-to-face communication. More people are working remotely and learning to work on Skype, Zoom or similar sites. Consequently, as many as 60% of companies now use webinars in their sales efforts. Low costs, high attendance and the ability to preserve recorded versions make webinars the way to go.
It's all still good
In the end, the contact methods a financial institution should use depend on what it needs to say, what it has to spend and who it wants to reach. All the old methods still have their uses, and the newer ones like the Larky Nudge® engagement platform can enable financial institutions to reach account holders like never before—in the moment. To learn more or see the platform in action, schedule a demo today.