Talk about a long sales cycle -- typically banks and credit unions only consider changing their data processing tech systems every five to seven years.
However, Dennis Jones, Marketing & Corporate Communications Manager at Jack Henry & Associates (JHA), says, "I believe in the early bird cliché. When people are making evaluations for short lists, we want to be on it."
Often this short-list building is triggered by an M&A -- either among technology providers or among their clients. "When that press release comes out, it triggers a lot of activity. Of course, everyone jumps all over it."
Even if the M&A doesn't force clients to make immediate changes, it does cause most clients to begin researching their options. They are more likely to be open to messaging from a wider array of vendors than they might normally be. "Hey, if you’re going to go to the trouble of moving house, you're going to look at more than one neighborhood."
Jones knew JHA's competitors were just as aware of this opportunity as his team was. How could JHA get the upper hand?CAMPAIGN
The problem with reacting swiftly to unexpected marketplace changes, such as M&As is that you are forced into reactive mode. Jones and his team decided they'd much rather have more control -- to proactively prep so they could swing into action with a greater degree of success.
(Note -- although we've numbered these steps below, they all occur pretty much simultaneously as part of the everyday workings of JHA's marketing department. They are in a constant state of prep in order to be ready for unexpected marketplace openings.)
Step #1. Prep the contact database
Although Jones' team's marketplace is a tight niche -- certain size banks and credit unions -- he didn't assume his database was ever completely accurate or up to date. So, he invested in an ongoing thorough telemarketing effort to determine:
- which technology the prospect used currently
- which, if any, pain points they associated with it
- when, if ever, they might re-enter the purchase consideration cycle
- who the key executives would be in the purchase, especially including an operations manager who might not sign the check but would have huge influence
He tested hiring an in-house calling staff versus outsourcing to a telemarketing vendor to get the job done.
Step #2. Invest in (even fleeting) face-to-face meetings
Jones believes strongly that executives are more likely to shortlist vendors when they've met someone from that vendor in person before. Even fleeting eye-to-eye contact can make a difference years down the road.
"We go to an extraordinary number of trade shows and we host executive seminars. It's a ton of expense, but it's one of the few opportunities that still exist where you can spend a few seconds or minutes in the face of the CEO who may someday be checking you out."
Step #3. Continue brand advertising year-round
"The financial services industry has on the whole a herd mentality," notes Jones. "They love to see what somebody else is doing. There's safety in numbers. If a bunch of people are moving to a certain system, they must be doing something right. They put you on the short list based on what they see out there."
Jones had the sales team ask all new clients if they would consider being named in an announcement ad to run in the print trades. Then, based on sales pipeline data, he negotiated space ad buys reserving pages months ahead of time for maximum discounts.
Then he packed each page with tombstone ads, announcing each new client win (when he had client approval).
Step #4. Warm the ground with targeted direct postal mail
Jones tested several types of direct postal mail packages -- ranging from a branded hanging file folder to oversized, colorful self-mailers. Key -- each was a multitouch campaign where he sent a prospect a new, related piece every week for four or more weeks on end.
The creative addressed the specific pain points a typical prospect was going through when they were forced to consider a new tech vendor -- due to M&As or discontinued software lines.
"We're very systematic. The DM campaign addresses where their mind is now. They are full of angst. They are going to have to make a move most people dread."
As with all other campaigns, Jones measures results, but "we don't expect much out of that. It's warming them up for the telemarketing call."
Step #5. Ongoing studies to prove your competitive advantage
As with many matured technology fields, JHA technological capabilities aren't strikingly different from the rest of the herd.
"Our competitors are very capable," Jones admits. "Banks are in the enviable position of choosing between a number of competitors who could all do a great job for them."
The marketing team needed to create marcom that helped sales nail deals, but they couldn't point to massively different tech features as a differentiation device.
Luckily, Jones was aware that multiple IT buying research studies show the real reason the majority of customers switch vendors is because they are fed up with service (even if they tell you it’s about tech features or price points). He believed JHA had far better service than the competition and this could be a critical hook to hang a sales pitch. But how to prove it?
The company launched two different ongoing service studies, both to find ways to improve service, and to provide real-life data for sales presentations. The first was an annual service survey to 1,700 core client CIOs.
The second was a triggered survey that was sent automatically by the service team to their direct contact at a client company whenever they resolved a particular trouble ticket. More than 50,000 of these were sent out every year.
The compiled results made for great press releases, newsletter articles and charts for PowerPoint slides.
"Year over year from July 1, 2005, to June 30, 2006, we grew from 6,700 to 8,700 accounts," says Jones. Although JHA did acquire a "limited" number of accounts through acquisitions in that time, the majority of that growth was "organic" in part due to the five-step prep process the marketing department worked so hard on.
Each step carries its own weight, but sales often require all steps working in conjunction to work. For example, a four-step direct postal mail campaign sent to warm up prospects gained a 0.06% lead generation rate.
However, a follow-on telemarketing effort to update and qualify database records for the same list also uncovered a 10.3% lead rate (prospects ready to start talking to sales rather soon about changing systems.) Jones believes both campaigns working together, along with the steady space advertising and trade show presence, were what made the difference.
Outsourcing telemarketing proved to be the best tactic. "Our in-house team had marginal success because it's difficult to find people who want to sit at a desk and make calls professionally and systematically all day long." However, finding the right vendor wasn't easy. The first vendor JHA worked with proved to be "not the most integrity-driven firm, and they were not watch dogged as they should have been by us. Shame on them and shame on us."
After sending an RFP to six additional telemarketing vendors, meeting with each face to face to determine chemistry and establishing better watchdog standards in-house, Jones was very happy with a second telemarketing outsourcing firm.
The winning direct mail test so far has been the four-part bright mailers. The file folder was clever and got attention, but cost too much per piece to be worth continuing given the impact.
92% of clients have responded to at least one service satisfaction survey in the past year, so the related metrics are extremely believable.
Lastly, Jones has learned marketing lessons about banks and credit unions. "From the point of view of the casual drive by, you'd thinks they are one and the same, but they're actually salt and pepper."
"Culturally credit unions feel like they are the underdog, against the banks. They love helping each other." In fact, when a JHA sales rep showed up for an initial appointment with a credit union in Washington state recently, he was thrilled and astonished to discover the prospect had invited execs from three other credit unions in the area to sit in on the presentation as well.
Banks are the opposite, "If the bank down the street is with JHA, then I should probably want different capabilities."
That means tombstone ads work well for credit unions, while more general branding ads work best to impress banks.
Top credit union executives are often easier to reach directly on the phone as well. They see their job as being approachable to everyone in the community, including vendors. On the other hand, top banking executives avoid speaking with vendors on the phone if they can. Many have even set up specific voicemail boxes that all vendor calls are automatically routed to by their assistants. Useful links related to this article:
TeleNet Marketing Solutions LLC -- the telemarketing firm that Jones relies on now:
Jack Henry & Associates Inc