'Green Banking' Builds Consumer Connections
According to Susan Menke, senior financial services analyst at Mintel, switching to environmentally friendly practices not only saves money by cutting down on paper costs, but can effortlessly build up goodwill among customers at a time when many are distrustful of the entire financial services industry.
"This is one small thing banks can do to rebuild that trust," Menke tells Marketing Daily. "It builds better feelings among people."
Many banks and financial institutions had been promoting green practices--from paperless statements to online bill-paying--before the stock market and financial services industry's problems were front-page news. As recovery is likely to come slowly, Menke says banks may want to either continue or step up those programs.
"It's a totally risk-free way to market," Menke says. "You're not going to offend anyone."
Along those lines, Citizens Financial Group (parent of Citizens and Charter One banks), earlier this month launched an incentive program that pays consumers cash for conducting electronic banking. Under its "Green$ense" program, customers get 10 cents for every electronic transaction they complete, with maximum payouts of $10 a month and $120 a year.
"With Green$ense, we pay customers for changing their habits in a manner that not only makes banking more convenient and their lives more manageable, but also is beneficial for the environment," said Citizens Financial Group chief marketing officer Theresa McLaughlin, in a statement. "We are pleased to offer this first-of-its-kind program to our customers, and proud of the impact it will have on the environment."
Tying the paperless and environmentally friendly programs to some sort of tangible reward is important in marketing a green banking program, Menke says. "Financial products are intangible. Give [consumers] a compact fluorescent bulb or a reusable market bag when they sign up for paperless banking," she says.
Given consumers' general distrust of the financial services industry, however, banks and other financial institutions have to back up these promotions with real earth-friendly practices. "Green marketing is a way to rebuild trust, if you do it in a way people believe it," Menke says. "You have to do it like you mean it."