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The standard uniform in the Royal Bank of Canada’s Toronto head…
The standard uniform in the Royal Bank of Canada’s Toronto head office is typical banker wear – dark suits and button-down shirts. But a few weeks ago Canada’s biggest company hired an employee who doesn’t fit the mould.
Michel Savoie, a 22-year-old francophone from Sudbury, is wearing a bright orange shirt in the office and asking a reporter if she’d like to see RBC’s new peer-to-peer website, a forum the bank created for students to discuss financial issues.
Across the top of the screen is the tagline “not your parents’ banking site.”
It isn’t hard to figure out why banks are attracted to the student market. More than four million Canadians are between the ages of 15 and 24.
Seventy-seven per cent of postsecondary students have a credit card, and many have student loans, making this demographic an attractive market for the banks. But it’s their future business the institutions are vying for. Most postsecondary students will be high-income earners in the future – and the banks have a better chance of securing their business if they act early.
An Ipsos Reid poll conducted for RBC last year found that 44 per cent of Canadians still hold an account at the bank at which they opened their first account. The same poll found that the vast majority of Canadians open their first account by age 20.
“The banks have woken up,” says Su McVey, vice-president of customer segments and strategy at Toronto-Dominion Bank’s TD Canada Trust division. She’s only half joking. It was just late last year that TD really started looking at the student market, she said.
While it’s not clear exactly what stirred up the banks, Ms. McVey said facts were brought forward illustrating that the banks needed to pay more attention to this market.
“They are the future; they are our customers now, too,” she said.
And so, as students head back to school this year, they just might notice they’ll be receiving a bit more attention from their local bankers, many of whom are heading out to campuses for frosh week events.
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But it’s on the Internet that they’ll notice the biggest marketing initiatives.
Besides the website, RBC has launched its own sponsored group, RBC Campus Connection, for college and university students on the social networking website Facebook.
TD Bank as also created a Facebook group. They are two of about 180 companies around the world to have started a paid page on Facebook. Others range from range from PepsiCo Inc. to TV stations.
TD’s site, called the Money Lounge, features tips such as how to eat for $7 a day.
It also has a short video of a young blonde rock star, decked out in tall black boots and a skimpy black dress, throwing a hissy fit in her dressing room. “I’m not comfortable,” she whines, before parking herself in one of TD’s trademark big comfy chairs. “Now I’m comfortable,” she says.
Research has shown that many students are too intimidated to walk into a branch and, for instance, ask for a loan, says Judy Murchison, RBC’s director of marketing strategy for the student market.
She began her task at the end of May, and spent some time prior to that researching the postsecondary student market. Only about 3 per cent of their transactions occur in a branch, she said. “We really feel that we’ve got to reach out.”
Ms. McVey points out that today’s youth communicate differently, spending much of their time online, and that can be a big challenge for marketers.
“For us, the initiative on Facebook is trying to build an understanding not only of the young adult segment, but also how to communicate effectively with them from a marketing perspective.”
It can be disconcerting to put your brand out there to be critiqued, Ms. McVey acknowledged. But the bank is willing to take those risks. “We had one executive who said ‘I’m going to be the coolest dad in the world when I go home and tell my son we’re on Facebook.'” It’s new territory, and some marketers say no corporation has really figured out how to use Facebook successfully yet.
Today’s youth respect integrity, authenticity, transparency. The traditional tools of large companies’ marketing divisions – gobs of market research followed by expensive campaigns – can result in a site that looks like it’s trying too hard, the exact opposite of what this demographic respects.
“This particular audience is so savvy,” said Jon Finkelstein, a partner at Toronto-based advertising agency Grip Limited who has worked on brands such as Nike and Levi’s.
Platforms such as Facebook are best for brands that can let their hair down, and take the bad comments with the good. A bank on Facebook should go with something refreshingly honest, like saying “you probably don’t expect to see us here, but …” Mr. Finkelstein said.
The banks know the game, and are attempting to win it.
“You’ve got to be relevant, but if you’re going to use humour you’ve got to be irreverent,” Ms. Murchison said.
“Because if you try to be funny, but you’re not quite funny enough, it’s sort of like – what was that analogy?” she said, turning to Mr. Savoie.
“It’s like the guy who’s trying to be cool but he’s nerdy.”
A)
This bank launched a new feature. Behind that innovation was a corporate strategy, in other words, a business plan. What was the bank hoping to achieve and why?
B)
How did this site launch become a news story in business media? Was the launch newsworthy?
C)
Consider the publication of this story from the perspective of a media relations team in the bank. What is the value of this opportunity? What are the benefits, drawbacks, costs, and limiting factors? Give a full assessment as if you are reporting to the business executives.
D)
The news provider is also a business. From the perspective of the editors and executives, what is the value of publishing this story for the newspaper? What do they get out of it? What are the benefits, drawbacks, costs, and limiting factors? Give a full assessment.
E)
How does the corporation frame their story (i.e. what impression of this new feature do they want the public to have)? How does the news outlet frame that story? Is there any evidence of setting the agenda (first level? second level?) or “risk society” themes?
F)
Does the reporter maintain objectivity, and if so how, or is this news story just good PR and advertising for the bank?
