5 Ways Community Banks & Credit Unions Can Crush Competitors Online

To beat megabanks, smaller institutions must craft a compelling story about their competitive advantages in digital channels.

Subscribe to The Financial Brand via email for FREE!To be successful online, community banks and credit unions must compete head-to-head with both big banks and smaller local institutions within their footprint. This can be a challenge.

Big banks spend over $17 billion on advertising and marketing annually, according to the FFIEC. Additionally, since many local community institutions may share similar attributes like supporting their communities and personalized service, it can be extremely difficult trying to differentiate your brand.

The key to crushing your competitors (online or offline) is to understand how you are truly different from both big national banks and smaller local institutions.

Exploit Your Competitive Advantages

What do most credit unions and community banks have that big banks don’t? For starters, they are more trusted. According to a study fielded by Kasasa, 93% of community bank customers and credit union members say they trust their institution, whereas one out of three megabank customers don’t trust their own bank.

Smaller institutions also tend to have less turnover than larger banks, and can form more lasting relationships with their customer base. This is important when consumers need to make big decisions, like where to place their life savings or how to handle a recent life change. Having a trusted relationships like these helps consumers feel valued in today’s faceless digital economy where most companies treat people like numbers.

Community institutions also tend to have a better understanding of their local neighborhood’s needs and residents, and have deeper ties to local community organizations. Yes, the bigger banks may have branches within local footprints, and may donate big checks to the local chapter of a national organization. But more often, they aren’t as deeply and personally embedded in the community in the form of creating jobs, giving back, and serving on boards.

How Are You Different That Other Local Institutions?

Although credit unions and community banks are clearly different, they are also very similar in several key areas. They both pride themselves on exceptional personal service. They tend to have lower fees and offer more competitive rates. But they often have a tough time competing with bigger banks’ technology offerings, who — despite having their headquarters hundreds of miles away — nevertheless position themselves as an “institution rooted in the local community.”

To compete, it’s smart to figure out what truly makes your institution unique, and to use those elements as the foundation for your marketing strategy. Conducting a competitive can help your institution discover what elements set it apart from other local institutions. Here are some questions to consider:

  • What ways does your institution beat out local and national competitors in price, product offerings or personalized service? Are your rates higher or fees lower on key products?
  • What digital capabilities does your community bank or credit union have that other national or local institutions don’t? Do you offer online account opening or better features within your mobile banking app?
  • How does your institution keep the customers or members that everyone worked so hard to earn? This may come in the form of a rewards or referral program or personalized service.

Figure out why people choose your institution instead of your competitors by fielding surveys and interviewing your customers/members. You should also gather information from your internal sales teams and branch managers — those who are working with the public on the front lines.

Generating New Business Online With Smart Digital Targeting

Once you’ve articulated your institution’s competitive advantages, the next step is to get that message out to the people most likely to care. Without the vast resources that megabanks have, it’s smart for community banks and credit unions to hone in on the following high-impact digital tactics.

1. Search Engine Optimization (SEO). Search engine optimization (SEO) should be your first line of defense against the bigger banks and local competitors. You should build a local SEO strategy and add to relevant pages. Most big institutions simply can’t compete on a hyperlocal level when it comes to SEO, but you can.

2. Content Strategy. A great banking website needs great inbound marketing strategy to convince people to visit and convert. Content can take many forms, from product pages to a blog or resource center, social media posts and emails. Take the time to truly understand your audience, and develop a content marketing strategy that drives interest at various stages of the sales funnel. Remember to mix up your content types to add variety and cater to many different audience needs. Also remember to localize your content where possible.

3. Social Media. Now that social media marketing is mainstream, it’s matured into a channel that can be used to target people with precision. Work towards creating content that sells and allocate budget towards social platforms to see success. Don’t forget to focus most of your social media content on what makes your institution unique and different so that you can reinforce your brand equity, mixing in product-related posts only about 20% of the time.

4. Pay-Per-Click Advertising (PPC). Pay-per-click advertising is another digital tactic that can help you beat out your competitors online, putting you at the top of search engine results for specific search queries. Select your keyword strategy strategically so you can bid on lower competition but highly relevant terms aligned with key business focus areas. If your bank or credit union has online applications like loans or checking accounts, those are great products to focus on driving conversion for within your PPC strategy.

5. Email Marketing. Email marketing is making a comeback, but it’s important to modernize your strategy. Email newsletters can be used to stay top of mind, increase cross-sales and much more. Email addresses can also be used to target digital ads across the web, so these days you must focus on building your email list.

This article was originally published on January 10, 2018. All content © 2018 by The Financial Brand and may not be reproduced by any means without permission.

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