President of the Nashville office of Dalton Group, Jeff is a former journalist with 30+ years of experience as a PR professional.
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Besides convenience, banks gain customers—retail customers especially, but also commercial ones—by having broad and positive recognition in the community. Being involved in the community is a natural and authentic way to build a brand for a financial institution, which should always be founded on trust in the institution’s stability and intentions. And in my opinion, there is no better way to prove the good intentions of a large and profitable business in a community than to demonstrate them through volunteer work and charitable donations to local causes.
That’s why it’s a given that the lead sponsor of high-profile charitable events are usually always banks. The banks are the first place you go to ask for help on community needs. It’s a given that your bank should budget generously for this marketing need, setting aside perhaps 5% or so of gross profit for charitable giving and the marketing of such giving. The return of this small slice off the top is typically 10x-20x what you spend. That is my estimation from handling bank PR and marketing in a midsize (though mighty) market for the last 30-plus years.
Of course, you reach a point of diminishing returns in charitable giving. Once firmly established as a stalwart of the community, extra expenses are less and less effective. I recommend a strong and dependable bank in a midsize market to have around 20% market share and its name on at least two or three signature community events—usually benefiting the arts, health care, family and children, and/or education. Every bank knows when it reaches this level. There is no magic number.
So, how do you build a bank brand that is both strong and stalwart? Well, most of it is good management by the bank president. A good bank president is that rare combination of razor-sharp business sense and strong emotional intelligence—that is, a smart person who truly cares about and can empathize with people: customers, employees, community members. This kind of leader can see opportunities within the community because he or she takes the time to know it and its leaders.
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Good bank presidents hire good PR people who take on and organize community relations for maximum effectiveness, and so we finally get to the subject of this article: how to do community relations for a bank brand. I think it is pretty straightforward:
• Identify the top causes and organizations in your market.
• Match these with the top opportunities for your bank.
• Consider the effect on the bank’s image of the results of this match.
• Choose the opportunity that best enhances the bank’s image and business opportunities.
How do you identify the top causes and organizations? I once knew someone, a great man in my city, who spent a lifetime learning about leadership and was himself a leader of impeccable honor. He once said you can have leadership based on organizational authority and title, on competence or on moral authority. But the best is a combination of all three: legitimate power wielded intelligently and humanely against a clear cause.
First, clearly delineate the problem that your bank’s community relations program is meant to solve, like homelessness, poor education, malnutrition, etc. Don’t be vague. Know how to measure success against it, define it and name it. The CEO and/or board decides on this. Marketing delineates, fights and, as much as possible, measures the results.
Then marketing finds or knows who is best at fighting the clearly identified problem, seeking the nonprofit organization with the best leadership and track record. You don’t have to work to find them; they will find you. Marketing’s job is to sift among them for the best and offer them the legitimate power of a significant financial commitment and association with the bank’s brand, which benefits both parties. That is, the nonprofit organization raises its brand status by associating with a strong bank brand, and the bank’s beneficence earns it the trust and appreciation of the community. Even if only subconsciously felt, this chest of community trust and respect is hard to value, and I won’t attempt to.
Setting community trust aside as a benefit, the pure marketing benefits of community relations far outweigh the cost of a bank community relations program. Direct benefits include positive publicity worth hundreds of thousands of dollars and, most importantly, access and introductions to—and the respect of—the community’s business leaders (i.e., the main customer of most banks).
Once you’ve identified the cause and have seen who in the market is best at fighting it, you look for a match to the bank’s financial or regulatory needs. Need more loans? Sponsor an arts gala, like a symphony series or museum ball, create and fund a new small business award, lead the chamber’s fundraising campaign. Need more deposits? Partner with a hospital or school to raise money and awareness of important issues, lead the United Way campaign, provide financing and mortgage services to affordable housing organizations. Ask your marketing people to be creative in how each partnership is implemented.
Finally, how will your community relations efforts affect the bank’s overall image? For example, if your other big push that year is in the arts, consider not doing another arts event. Find a great organization and cause in health or education to balance things out. Or, perhaps you are a boutique bank and you kind of want to be known as elite and sophisticated, in which case it would enhance the brand to be all-in on the arts. The point is to be intentional about your choice and aware of the overall picture when conducting your bank’s community relations program.
When you are aware and intentional in this way, I believe you will find that your community relations program pays enormous dividends for your organization—and personally for you and anyone involved because your lives will be better, fuller when you are more involved in your community. It is truly doing well by doing good.
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Author: Jeff Bradford, Forbes Councils Member
