7 Reasons Why Financial Institutions Should Do Email Marketing

Here are just a few reasons why email marketing should be a component of a financial instituion's overall marketing program:

1) Their competitors are doing it. When a consumer has a need the will tend to remember the most recent interaction they had with a bank. If that happened to be an e-newsletter or blog post then that financial institution will likely get first crack at the business.

2) Email marketing is a perfect fit for a customer loyalty strategy. Providing useful information that helps people understand and manage their finances makes those relationships more sticky.

3) Before the Internet, many banks, insurance companies, etc. would mail monthly or quarterly magazines to clients. These high quality pieces were packed full with interesting stories, tips, etc. and tied that content back to products and services the company offered. However, it is a huge expense to write, produce, print and mail. Email solves all of that.

4) Financial institutions can choose to produce their email content in-house or outsource to a third party who creates a private label e-newsletter for them. For example, I write a daily e-newsletter (Daily Dollar Newsletter) that coaches and educates consumers on their personal money matters. A bank could syndicate our content as a private label to their own customers so it looks like it came from the bank.

5) The marketing wave taking off right now is customer generated comments. See Expedia, Amazon, etc. for examples - they gather huge amounts of customer reviews about hotels, books, etc. Customers are making purchase decisions partly based on these reviews. I know someone who won't even consider staying at a hotel that ranks under 4.7 on customer reviews on Expedia. The first thing they do when they pull up a list of hotels on Expedia is sort by Customer Rating. Customer experience content can be gathered by financial instituions and published to the wider customer base so everyone benefits from the knowledge.

6) Low risk. Decision makers at financial institutions face very low barrier to entry to launch email marketing program. The costs are very low and can be easily measured. Shutting down the program is easy too. There's very little risk and huge upside.

7) Social Media: A lot of companies want to be involved with social media but have trepidation or don't know how. Email marketing solves this challenge too. The content generated for email marketing can then be easily shared across social media channels. Suddenly you have something useful to post on Facebook, Twitter, etc.