Marketing that Interacts: the trend today is toward marketing in which the bank communicates with prospects and customers through two-way, Internet-facilitated channels--closely integrated with traditional advertising. Here are some examples of community banks that are marketing interactively.

• Author: Hershberger, Tara

THIS YEAR FOR THE FIRST TIME, more money will be spent on digital advertising than on print advertising. Clearly if your bank is not already doing interactive marketing, it probably will be in the near future.

In this article will discuss what interactive marketing is, what benefits it offers and how some community banks are using it today.

A dialogue enabled by the Internet

What is interactive marketing? It is the two-way flow of information between the financial institution and the customer or prospect. It is a dialogue facilitated by Internet technology rather than a one-way communication--such as a traditional letter or a print ad.

Interactive marketing is highly evolved marketing with participation and communication as key elements. Customers are recruited and empowered to aid in further development of strategy through their feedback.

The interactive marketing discussed here is that involving advertising on Web sites and search engines, as well as e-mail marketing and investments in Web site development.

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There are more interactive marketing opportunities available than ever and the challenge is determining which will give the greatest return on investment. Interactive media as a whole is uniquely qualified in this respect because of the measurability and accountability it provides. A whole new lexicon has been built around measurement of digital media.

The benefits

Consider your Web site a hub with numerous two-way connections. Online advertising and e-mail marketing directly drives traffic to a bank's Web site, product pages, microsite, landing pages or social site. Results can be recorded several ways. Advertising statistics report how many times the ad was shown (impressions) and those who took action (clicks) as well as the overall response rate (click-through rate). Further statistics can show actual conversions (such as online account openings) and calculate return on investment (ROI) provided the final landing page can accept a short piece of Internet code. Free Web site tools such as Google analytics provide insight into Web site traffic, effectiveness of marketing efforts and site interaction information.

Interactive marketing has a rebalancing effect and can assist in the seemingly never-ending battle to offset a bank's aging customer base. Gen Y consumers seek out advice from their social network and place a high value on what their connections have to say--statistically three times more than older generations. Interactive marketing helps to counter the aging customer challenge by reaching younger prospects...