Mix it up: The Search for the Perfect Marketing Strategy

As appeared in Australian Broker 30 July 2005

After spending the last eleven years watching the evolution of the
financial services and mortgage industry in Australia, I have come to
realise two things; nothing stays the same - organisations rationalise, people come and go and products change their structure. Everything from product distribution, commission structures and service standards are changing; and on the other hand, much stays the same. Many organisations are offering what is basically the same product. Different brands, and differing bells and whistles, but there is only so many things you can do to a mortgage offering to make it different.

So, how to differentiate ones offering?

Marketers spend much of their time contemplating this dilemma, and as the CEO of evolution media, we get paid to give clients the answer to that question. And the simple answer is, there is no easy answer. Much depends on how evolved the brand is, whether the product is offered from a manufacturer, distributor or a hybrid, and who exactly they are targeting to buy that product.

It seems most of the market today in terms of mortgage providers has realised that the multi provider approach is one of the most profitable ways to achieve mass product distribution.

Which leads to the great divide in terms of marketing. We see boutiques, with little to no brand - but excellent value product struggle
to crack into the distribution space. Then there are the previous institutional giants - who have a brand recognisable to consumers, but not
the features to make them top of the recommended list.

Then there are those lucky organisations that have cracked the magic combination of enough brand recognition for brokers and end users to feel
comfortable with, and a track record to match. But with multiple shops offering one product how do they each gain a share of voice that attracts the ever-constant flow of funds into the mortgage industry.

Surely there is an opportunity for all those players who do not yet have brand recognition but do have a performance story.

But how to get noticed?

And in the greater scheme of things - how to get noticed and build brand equity on a budget?

Even when an approved product is on a broking platform, there is no guarantee of buy in. And although mortgage brokers will cite product features, business strategy and interest rates as they key aspects of how they rate product, brand and marketing strategy surely come into play.

While there are some organisations that do have multi-million dollar budgets to spend on advertising and marketing, most have somewhat less than that, but still need to compete with the marketing giants on an open playing field.

In my experience, the best marketing strategies are not necessarily those with the biggest spend - rather, those with the smartest approach to share of voice.

To integrate marketing strategy with a variety of communication tactics is a relatively standard approach in today’s sophisticated marketplace. What tactics to use, when and how, is usually where people underachieve in the brand arena.

One approach that is growing in popularity both in the Australian financial services marketing mix and in general is online advertising and promotion. In fact according to the Australian Bureau of Verification Services, there was a 64% growth in online revenue last year alone - representing a total spend of $388 million marketing dollars.

And topping the list of big spenders in the online space is the finance industry - with more than a 50% growth rate in spend in the last year.

The Internet is a relatively cost effective way of advertising product and services and reaching mass audiences.

However, according to ING Marketing Manager Michael Smolders, is still not as efficient at reaching the end user as other mediums such as direct mail.

“We know we can reach customers through sophisticated databases that give us accurate information to directly reach our target audiences. Online advertising on mass mediums such as search engines may get seen by mass consumers, but are they the right consumers?” he commented.

But according to Yahoo Managing Director Cliff Rosenberg, the growth in online spend in advertising was low in comparison to the share of voice the Internet represents.

He commented on the growth of the online industry, saying that it “still represented a relatively low share of marketing spend” overall.

A recent report from Forrester Research in the US showed that the internet’s share of voice is more than 30% - yet accounts for only 3% of overall marketing spend.

Australians love the Internet, and in fact have become the third biggest online shoppers in the world, behind the UK and the US. Online shopping last year alone jumped 38%, in recent figures to March released by Visa International. Australians increasingly trust the security and technology of the Internet and have adopted in their every day lives.

So when considering marketing, mortgage providers should see online promotion as a particularly valid mix in their communications
strategy.

While online advertising is one way to create brand equity - electronic direct mail is another. Those marketers who are savvy enough to build online campaigns with a compelling response mechanism have seen tangible results at relatively low cost.
The right response mechanism can build a database that can be incredibly valuable in creating a dialogue with customers - both potential and existing.

A company that is particularly savvy in creating online relationships with its customer base is E*Trade, the online broker.

Marketing Director Richard Burns says they use both online advertising and electronic direct mail (email) to create an ongoing relationship with new and existing clients.

“In our experience, touching someone via email around 30 times a year is the right mix - the content must add value to the end consumer and be regular enough to be a trusted informer, not an nuisance sales message,” he said.

Probably the key to achieving cut through in electronic direct mail (and in fact all direct mail campaigns) is a message and offer that adds value to the receiver. It is just as easy to delete an email, as it is to throw out ‘junk’ mail. This is where smart marketers and agencies can really add value to businesses looking to differentiate.

Another key ingredient is timing - the right timing for the audience (for example, end of financial year is a bad time to try and create a dialogue with investors and distributors) and the right timing for your entire communications efforts. By this I mean tangibly measuring your share of voice in the market throughout the year.

Inevitably there are always gaps in a businesses communications to the outside world. Campaigns cannot run all year around, unless you have the biggest of marketing budgets.

One of the most effective ways I have found to keep a constant voice to market is via smart media relations.

It is a fact that while advertising and direct mail can create a credible relationship with an audience, editorial is treated as the ‘trusted friend’. This can work both for and against your organisation, depending on the press you are receiving.

Having a credible opinion in this industry, and taking some space as a ‘thought leader’ can work wonders for your brand and offering. The other factor is that media relations, when done right, can be particularly cost effective in your marketing spend.
There is a big difference however, between flogging product (which most people, including journalists, find boring) and making interesting and topical commentary.

When thinking about media relations, there needs to be three factors considered: is this relevant to readers today? Has anyone said it before? Will anyone care that I am saying it?

As the industry continues to consolidate in players, but grow in assets, it is the smartest marketers who will grab future market share. More organisations than ever are opening the coffers of marketing in the choice of fund environment. Television (previously the domain of the big banks) is being utilised to grab the end consumer as well as outdoor advertising, mainstream ads and partnership/loyalty programs.

Who will win battle of the brands?

Most likely those players that create a voice to market that is diversified, relevant and innovative.

Interesting times ahead.

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30 July 2005 The more things change, the more they stay the same. Vanessa Stoykov looks at the best, or smartest approaches when differentiating your brand in a crowded and sometimes confusing market? After spending the last eleven years watching the evolution of the financial services and mortgage industry in Australia, I have come to realise two things; nothing stays the same - organisations rationalise, people come and go and products change their structure. Everything from product distribution, commission structures and service standards are changing; and on the other hand, much stays the same. Many organisations are offering what is basically the same product. Different brands, and differing bells and whistles, but there is only so many things you can do to a mortgage offering to make it different. So, how to differentiate ones offering? Marketers spend much of their time contemplating this dilemma, and as the CEO of evolution media, we get paid to give clients the answer to that question. And the simple answer is, there is no easy answer. Much depends on how evolved the brand is, whether the product is offered from a manufacturer, distributor or a hybrid, and who exactly they are targeting to buy that product. It seems most of the market today in terms of mortgage providers has realised that the multi provider approach is one of the most profitable ways to achieve mass product distribution. Which leads to the great divide in terms of marketing. We see boutiques, with little to no brand - but excellent value product struggle to crack into the distribution space. Then there are the previous institutional giants - who have a brand recognisable to consumers, but not the features to make them top of the recommended list. Then there are those lucky organisations that have cracked the magic combination of enough brand recognition for brokers and end users to feel comfortable with, and a track record to match. But with multiple shops offering one product how do they each gain a share of voice that attracts the ever-constant flow of funds into the mortgage industry. Surely there is an opportunity for all those players who do not yet have brand recognition but do have a performance story. But how to get noticed? And in the greater scheme of things - how to get noticed and build brand equity on a budget? Even when an approved product is on a broking platform, there is no guarantee of buy in. And although mortgage brokers will cite product features, business strategy and interest rates as they key aspects of how they rate product, brand and marketing strategy surely come into play. While there are some organisations that do have multi-million dollar budgets to spend on advertising and marketing, most have somewhat less than that, but still need to compete with the marketing giants on an open playing field. In my experience, the best marketing strategies are not necessarily those with the biggest spend - rather, those with the smartest approach to share of voice. To integrate marketing strategy with a variety of communication tactics is a relatively standard approach in today’s sophisticated marketplace. What tactics to use, when and how, is usually where people underachieve in the brand arena. One approach that is growing in popularity both in the Australian financial services marketing mix and in general is online advertising and promotion. In fact according to the Australian Bureau of Verification Services, there was a 64% growth in online revenue last year alone - representing a total spend of $388 million marketing dollars. And topping the list of big spenders in the online space is the finance industry - with more than a 50% growth rate in spend in the last year. The Internet is a relatively cost effective way of advertising product and services and reaching mass audiences. However, according to ING Marketing Manager Michael Smolders, is still not as efficient at reaching the end user as other mediums such as direct mail.“We know we can reach customers through sophisticated databases that give us accurate information to directly reach our target audiences. Online advertising on mass mediums such as search engines may get seen by mass consumers, but are they the right consumers?” he commented. But according to Yahoo Managing Director Cliff Rosenberg, the growth in online spend in advertising was low in comparison to the share of voice the Internet represents. He commented on the growth of the online industry, saying that it “still represented a relatively low share of marketing spend” overall. A recent report from Forrester Research in the US showed that the internet’s share of voice is more than 30% - yet accounts for only 3% of overall marketing spend. Australians love the Internet, and in fact have become the third biggest online shoppers in the world, behind the UK and the US. Online shopping last year alone jumped 38%, in recent figures to March released by Visa International. Australians increasingly trust the security and technology of the Internet and have adopted in their every day lives. So when considering marketing, mortgage providers should see online promotion as a particularly valid mix in their communications strategy. While online advertising is one way to create brand equity - electronic direct mail is another. Those marketers who are savvy enough to build online campaigns with a compelling response mechanism have seen tangible results at relatively low cost. The right response mechanism can build a database that can be incredibly valuable in creating a dialogue with customers - both potential and existing. A company that is particularly savvy in creating online relationships with its customer base is E*Trade, the online broker. Marketing Director Richard Burns says they use both online advertising and electronic direct mail (email) to create an ongoing relationship with new and existing clients. “In our experience, touching someone via email around 30 times a year is the right mix - the content must add value to the end consumer and be regular enough to be a trusted informer, not an nuisance sales message,” he said. Probably the key to achieving cut through in electronic direct mail (and in fact all direct mail campaigns) is a message and offer that adds value to the receiver. It is just as easy to delete an email, as it is to throw out ‘junk’ mail. This is where smart marketers and agencies can really add value to businesses looking to differentiate. Another key ingredient is timing - the right timing for the audience (for example, end of financial year is a bad time to try and create a dialogue with investors and distributors) and the right timing for your entire communications efforts. By this I mean tangibly measuring your share of voice in the market throughout the year. Inevitably there are always gaps in a businesses communications to the outside world. Campaigns cannot run all year around, unless you have the biggest of marketing budgets. One of the most effective ways I have found to keep a constant voice to market is via smart media relations. It is a fact that while advertising and direct mail can create a credible relationship with an audience, editorial is treated as the ‘trusted friend’. This can work both for and against your organisation, depending on the press you are receiving. Having a credible opinion in this industry, and taking some space as a ‘thought leader’ can work wonders for your brand and offering. The other factor is that media relations, when done right, can be particularly cost effective in your marketing spend. There is a big difference however, between flogging product (which most people, including journalists, find boring) and making interesting and topical commentary. When thinking about media relations, there needs to be three factors considered: is this relevant to readers today? Has anyone said it before? Will anyone care that I am saying it? As the industry continues to consolidate in players, but grow in assets, it is the smartest marketers who will grab future market share. More organisations than ever are opening the coffers of marketing in the choice of fund environment. Television (previously the domain of the big banks) is being utilised to grab the end consumer as well as outdoor advertising, mainstream ads and partnership/loyalty programs. Who will win battle of the brands? Most likely those players that create a voice to market that is diversified, relevant and innovative. Interesting times ahead. http://www.evolutionmedia.com.au/index.php/8/