Banking on Digital Growth
Banking on Digital Growth

Episode · 1 year ago

6) #ByTheBook: Financial Stress in the Fourth Industrial Revolution

ABOUT THIS EPISODE

87% of Americans reported experiencing "high" or "moderate" levels of anxiety in connection to money in a survey conducted by Northwestern Mutual.

And that was before COVID19.

Consumers have had to adapt to a new existence, where they conduct all of their day-to-day activities from home. 

The pandemic has accelerated the need for people to adopt a completely digital-based lifestyle at breakneck speed. 

People are sheltered. People are scared. And people are still stressed about their finances. Now perhaps more than ever. 

Are traditional banks and credit unions seeing an opportunity to fill a new and emerging consumer need? 

Sadly, from what I am observing, the answer is mainly no.

Developing modern marketing & sales strategies to reflect the pain of financial stress post-pandemic is going to be a must for financial brands. 

Some of the things I unpack in this episode:

-How consumers feel about money directly influences more than you may think

-Branch centric banking is dead

-Financial brands have an opportunity to rocket forward right now

-“Dabbling in digital” isn’t going to cut it.

-How you can be the guide in the financial stories of others

This episode is hosted by James Robert Lay  Founder and CEO at Digital Growth Institute

You can listen to this episode on Apple Podcasts, on Spotify, or here.

You're listening to banking on digital growthwith James Robert Lay, a podcast that empowers financial brand marketing, sales andleadership teams to maximize their digital growth potential by generating ten times more loans anddeposits. Today's episode is part of the by the book series where James Robertunlocks and shares the secrets of digital marketing and sales strategies for financial brands fromhis upcoming book banking on Digital Growth, a strategic marketing manifesto to say financialbrands. Let's get into the show. Greetings in Hello, I am JamesRobert Lay and welcome to the six episode of the banking on digital growth podcast. Today's episode is part of the by the book series where I share insightsfrom my book banking on Digital Growth, the strategic marketing manifesto to transform financialbrands. So today I want to talk to you about something just a littlebit personal in fact. From our primary and secondary research, we found thatthere's a tremendous amount of shame tied up in the subject. That is isreally deeply rooted in the subconscious beliefs and our thought patterns that stem from ourupbringing, from our childhood. And No, I'm not talking about sex. However, it's interesting to note there are multiple research studies that have found itis easier for couples to talk about sex than it is this very taboo andsensitive subject for a lot of us. What I want to talk to youabout today is money, because through the primary research that we've conducted here atthe Digital Growth Institute, we've asked this one question, how does money makeyou feel, as part of our digital...

...secret shopping studies, and after askingthis question to over a thousand different people now we've distilled the vast majority ofresponses into really three key feelings and emotions. Number one, money is confusing andand this is where someone says, yes, I know money is important, but I'm not sure what I should do with it. I'm not sureshould I should I invest it? Should I save it? Should I borrowit? The second point is people feel money is stressful, as I startedthis conversation, because it doesn't really matter whatever I do, I don't feelI ever have enough money. And that leads to the third point that peopleshare. Money is overwhelming because I got this mounting debt that makes me feellike I'm drowning. So what people share? So, in addition to our ownresearch, there's been a study that was conducted by the financial APP Stash, and they found that sixty three percent of people reported money as a majorsource of stress in their life. And in that same study also found thatthirty four percent of people shared that they filled their too embarrassed to discuss financialmatters because, and I find this so interesting, they're embarrassed to talk aboutfinancial matters because they feel that they're worse off than their peers. So thereis some shame tied to that. Now, coming back to the point of financialshame, the Stash study found that twenty percent, or one in five, people don't talk about money with others because they're ashamed of their personal financialhabits. Money coach Tammy lally noted that...

...money shame is the silent killer inher very moving tedex talk where she shared the tragic story of her brother andthe deadly told that financial stress took on him and his family. So yeah, money is stressful. And there was another study that was conducted by northwesternmutual where they found that eighty five percent of Americans today feel stressed about theirfinances in some shape, form or fashion. So here we are in two thousandand twenty and really for the next what I see is two to threeyears. If we're looking at the macro level, money will be more stressfulthan ever before as we're moving into a post covid nineteen world, and thisstress is going to take a toll on people's health, their relationships, theiroverall sense of wellbeing, because there have been multiple studies showing the direct correlationbetween a person's financial wellbeing, their physical wellbeing and their mental wellbeing. Sowhat does this mean for you? What does this mean for your financial brand? The reality is in this post covid nineteen world, consumer behavior has changed. Even before covid came crashing down on all of us, people didn't trustfinancial institutions like they used to. And now the financial brands that failed toadapt to these new conser consumer behaviors, these new attitudes, these new trends, and they don't adjust their marketing and sell strategies to reflect the consumer painof financial stress and the toll that's taking on them through their health, theirrelationships, their well being. It's going...

...to be a challenging road ahead,but unfortunately that's what I'm seeing happening almost across the board for the vast majorityof traditional banks and credit unions, rather than welcoming an opportunity to fill anew need with, will just call it, modern messaging and communication strategies that speakto those desperately looking for a partner that they can trust, a partnerthat can guide them beyond the stress they feel to a bigger, better,brighter future, most financial brands are still doing the same old marketing they alwayshave in the same ways that they always have. Moreover, legacy marketing andsell strategies I'm seeing don't really reflect the way consumer behavior has changed, andI can't stress enough covid is reshaping the way consumers think about banking, theway that they conduct financial transactions. Jim Maruse and I had a very goodconversation about this in episode sewed. Three recommend if you haven't listened to it, go back and listen to that because because we get into the longer thatwe're in this post covid world, the more consumers will transform their behaviors.Technology has transformed our world and digital has changed the way consumers shop for andbuy financial services forever. Now. Consumers make purchase decisions long before they walkinto a branch, if they walk into a branch at all. But yourfinancial brand still wants to grow loans and deposits. We get it. Digitalgrowth can feel confusing, frustrating and overwhelming for any financial brand marketing and salesleader. But it doesn't have to,...

...because James Robert wrote the book thatguides you every step of the way along your digital growth journey. Visit wwwdot digital growthcom to get a preview of banking on digital growth. It isa strategic marketing manifesto that was written to say financial brands and it is packedfull of practical and proven insights you can use to confidently generate ten times moreloans and deposits. Now back to the show. So digital was changing theway that people shop. Covid is really forcing that even more so, theway that we shop, the way that we bank, the way that welearn, the way we that we connect, the way that we relate, theway that we even eat. And so when we look at all ofthis change happening, we were seeing before that consumers were coming into branches lessand less and less. Even in episode number five, conversation with Brett King, we were really reflecting upon his predictions, dating all the way back to twothousand and twelve, with branch today, gone tomorrow, and now, becauseof Covid, maybe consumers might not ever have to go into a branchat all because they see everything that they can do through the digital channels,through the mobile channels. The problem is financial institutions have been stuck in anoutdated branch first growth model where the inperson branch visits were traditionally seen as theprimary growth opportunity, the primary cells opportunity. But we have to look at thetransformation of consumer behavior because most of...

...the time, a consumers buying decision. Even if we go back to pre COVID, and we'll call that likebefore March of two thousand and twenty, the majority of the time consumers werealready shifting and shaping a buying decision for financial product at a much earlier stagein the buying journey, regardless of where they applied for a loan or anaccount, whether that was online, over the phone or in the branch.And if you're like many of the banks and credit means that I've worked with, you know that your financial brand's future growth is not going to come frombranches alone, if from branches at all for that matter, in a postcovid nineteen world. You've watched it yourself. You've seen branch Trafford declining year afteryear, and you might have also struggled, you know, with thiswhen it comes to your marketing efforts. What I diagnosed is dabbling in digital. Yes, you built mobile responsive at a compliant website. It looks beautiful, but in reality it's still just a glorified online brochure. Yes, you'resending out more emails, but maybe it's in the batch and blast format andmost likely it's not as highly personalized as it could be. You're probably placingdigital ads, but you're not exactly sure how effective they are in regards toconversion and and measuring beyond clicks on an apply button. And then you're probablyposting some content on social media, but you're questioning the value of that.What am I getting in return for that time? And so you feel stuckbecause deep down you know traditional broadcast marketing...

...strategies and tactics do not work withdigital. The same thing is true traditional cell strategies do not work in adigital first world. So what's the solution. How are you going to finally transformyour marketing and Cell Strategies for a postcovid digital first, mobile first economy, empowering you to really maximize your digital growth potential and rocket ahead of yourcompetitors, whether they be other traditional financial brands or or digital financial brands?First, let's look at this revolution and evolution for what it is and embraceit, not fear it, because, yes, we are moving into thefourth industrial revolution. If we look back over the past few hundred years,there have been three industrial revolutions that we've all traversed through, and now weare in the midst of a fourth. First, of course, it wasthe steam revolution of the late seventeen hundreds, then we had the electric revolution ofthe eighteen hundreds and finally, the computer revolution of the S and S. However, not as often discussed or really thought about or the revolutions thathappened in marketing and communications that accompanied the development in the industrial revolution. So, for example, we went from print and newspaper to mass media, IETV and radio, to digital, the Internet. And with the fourth industrialrevolution that Covid is a forcing function and moving us further and faster into it. We have now moved beyond the computer age and entered an age earn error, the age of Ai, if you will, when we have exponential technologies, robots, artificial intelligence, virtual reality,...

...the Internet of things, in avast array of other possibilities, some that we haven't even considered at thatpoint. So what does all this mean for the evolution of marketing? Whatdoes all this mean for the evolution of cells, particularly through the Lens ofFinancial Services? See, with the rise of automation comes a new potential tofully realize the one to one consumer communication shure ategies at scale that many havebeen talking about over the last three, four, five, six seven years. It's becoming reality and the old days of the one too many message strategy, whether it be from marketing or from cells to dead it's gone, andthat kind of one way broadcast marketing is simply no longer relevant today. Sothe name of the game is reaching people where they are along the course oftheir own consumer journey so that you can communicate with confidence, you can builda connection through empathy, with a digital relationship that puts them first. Andjust as we are entering the fourth revolution of technology, we're also in thefourth revolution of marketing. So throughout my book banking on digital growth, we'regoing to return to some of these concepts of empathy and the consumer journey timeand time and time again, because in fact, every single one of usis on a journey. Narrative is central to the human existence. It justfor a moment, I want you to go back in your mind to yourninth grade literature class and think about story before a moment, because one arethe key lessons that we all learned in...

...that ninth grade literature class is therecan only be one hero in every story, and that's exactly where we're going topick up on this story on the next episode in the by the BookSeries on the banking on digital growth podcast. Until next time, be well,do good and wash your hands. Thank you for listening to another episodeof banking on Digital Growth with James Robert Laigh. Like what you hear,tell a friend about the podcast and leave us a review on Itunes, stitcheror spotify, and subscribe while you're there to get even more practical, improveninsights that can guide you in your financial brand along your digital growth journey.Visit www dot digital growthcom to get a preview of James Roberts upcoming book,banking on Digital Growth, a strategic marketing manifesto to save financial brands. Insideyou'll find a strategic blueprint framed around twelve key areas of focus that empower youto confidently generate ten times more loans and deposits. Until next time, bewell and do good.

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