Category Archives: Banking

Market Research Pitfalls, Part 1: The Art of Asking Questions

In working with clients, we often encounter marketing organizations that have been snakebitten by ineffectual research to the point that they no longer see the value in conducting it at all. Why is it so hard to produce valuable research?

One reason is that many don’t understand that the most natural and effective starting point for research is with a strategic problem. They think of research as a box to check rather than as a tool that can help them optimize their performance. Or, they think of research only as a tool for certain situations—focus groups for brand work, surveys for customer satisfaction measurement etc.

To be sure, there is an art to identifying and articulating strategic problems in a way that enable research support. It is the step that lies between identifying an issue—a product or sales region not making their numbers, a marketing program not generating the projected number of leads—and a proposed solution where this art can most effectively be practiced. In reality, however, most organizations simply want to make changes and move on. They don’t bother to ask the questions which are critical to producing effective, strategically vital research. The answers to questions like the following, delivered through well-designed research, play a central role in strategic and tactical decision-making:

  • Do customers in the underperforming sales region have different attitudes than those in other regions?
  • Did customers not know about the new product or were they simply not interested?
  • Are prospects responding more strongly to competitors’ lead generation efforts and if so, why?

Conducting research is not a panacea—it won’t give you all the answers and it’s not worth the investment in all situations—but it can and should help more than it does. Organizations just need to stop and ask the right questions.

More banks launch initiatives for National Small Business Week

Earlier this month, we posted a blog on small business initiatives from Citi, TD Bank and Wells Fargo, which were introduced in advance of National Small Business Week. As National Small Business Week is taking place this week, other leading banks have also introduced new small business initiatives.

  • Chase introduced a number of initiatives, including incentives of up to $1,000 for new small business checking customers, as well as Instant Storefront from Chase, a solution that enables small businesses sell products online.
  • Bank of America launched a suite of small business charge cards (see our blog on this launch).  In addition, the bank has partnered with SCORE to develop a five-part series of three-hour workshops for small businesses, entitled “Simple Steps for Starting Your Business.”
  • Capital One partnered with Better Business Bureau to introduce Managing Credit – Made Simpler, a set of resources to help small businesses to manage credit.
  • American Express OPEN introduced AdManager, a tool to help small businesses manage online advertising campaigns

It is notable that the number of small business campaigns is much larger this year than it was for National Small Business Week in 2010, reflecting the improved economy over the past year, as well as banks’ renewed interest in the small business market.

Leading U.S. banks maintain branch numbers

The emergence of electronic channels in the financial sector has led some commentators to predict the imminent demise of the branch channel. In a previous blog, EMI disputed this prediction, arguing that banks would maintain a significant physical presence, although there would be changes in branch activities.

U.S. banks’ ongoing commitment to their branch networks is seen in the latest quarterly financials.  Data is available for 8 of the top 10 branch networks in the U.S. (the exceptions are Wells Fargo and TD Bank).

  • These eight banks combined operated 23,152 branches in 1Q11, a decline of just 27 from 1Q10, and 7 from 4Q10.
  • Two of these banks (Chase and U.S. Bank) grew their branch networks in the most recent quarter.  And in April, Chase reported that it would open 100 branches in California and 37 branches in Florida in 2011.
  • Bank of America registered the largest decline, with a decline of 51 branches between 4Q10 and 1Q11.  Even after this decrease, it has more than 5,800 branches.

So, banks appeared committed to their branch networks for the foreseeable future.  Electronic channels are now very effective in handling everyday service transactions, and are increasingly important sales channels.  However, branches are still required for more complex and sensitive sales and service transactions, as well as for providing advice.  However, banks need to continue to invest in their branches (in both physical infrastructure and personnel) in order to optimize effectiveness.