Marketing Budgets Still Increasing
Banks' marketing budgets have been steadily rising over the last several years as they scramble to keep up with competition from other financial and non-financial firms, a survey by American Bankers Association revealed.
Last year, budgets increased 5 percent over 2003 actual expenditures, which were $9 million, and 2003 expenditures constituted an increase of 4.6 percent over 2002 spending.
Spending reflected a continuing boom in retail banking, ABA said. On average, 66.5 percent of marketing expenditures were aimed at courting consumers, while 23.2 percent went to the small business market, 7.4 percent to commercial lending for mid-market businesses and 1.2 percent for commercial lending to large corporations.
In addition, 70 percent of banks introduced a new product or service in 2003 with checking and savings accounts making up more than half of those. Market segmentation - targeting specific consumer groups - was practiced by 85 percent of survey respondents with criteria varying from customer relationship (73 percent) to age (67 percent) to income (64 percent) and geographic location (61 percent).
Copyright © 2004 Bankers' Hotline. Originally appeared in Bankers' Hotline, Vol. 14, No. 8, 10/04
First published on 10/01/2004