Banks Utilize Direct Mail In Financial Unrest

An interesting article by Aaron Baar of "Marketing Daily" (11/28/08).
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Banks Fight Poor Image With Direct Mail Pieces
by Aaron Baar, Friday, November 28, 2008, 12:52 PM

Banks are fighting bad news headlines with messages of their own in the form of direct marketing.
According to Mintel Comperemedia, the country's banks sent 42% more direct mail solicitations in the third quarter of the year than they did during the second quarter. Moreover, the 53 million offers sent during the third quarter of 2008 was nearly twice the number sent during the same period in 2007.
Much of the increase is from banks looking to assure customers that their money is safe, particularly as ownership of many banks and financial services companies is changing rapidly. "There's an increase in assurance going out to 'current' customers," Pamela McHugh, president of Comperemedia, tells Marketing Daily. "When we're looking at all the mergers and acquisitions taking place, there are new players, and the communication tends to be reassurance to old customers and reassurance to [newly acquired] ones."
Along those lines, the banks have switched their direct-mail messaging from mortgages and loans to more savings-oriented products like CDs and deposit accounts, McHugh said. According to Mintel, banks sent more than 300 times more savings-related direct mail pieces to current customers in the third quarter of the year than the second. Direct mail solicitations for checking accounts were up 90% during the same period.
Although the banks were focusing their efforts on reassuring current customers, they also used the unrest to increase communications to fuel customer acquisition. According to Mintel, new customer direct mailings were up 8% over the previous quarter.
"It's not as significant as the customer communications mail. But banks are trying to take advantage of the uncertainty in the marketplace," McHugh says.
As the turmoil in the bank industry is expected to continue, so will the continued use of direct mail, according to Mintel. "With banking, direct mail is so easy," McHugh says. "I think they'll continue with direct marketing, particularly for retention, but for acquisition as well."