Capital One’s European head of brand marketing Justin Basini talks about the challenges of resourcing and measuring multi-channel campaigns, as well as ways in which the web has affected how consumers research and buy financial services.
Can you start off with an overview of your web marketing strategy?
We are moving much more to a multi-channel approach. We see the web as an integrated part of the marketing mix and an increasingly important part of it. Within that context, there are two things we see the web being good for.
The first thing is in building our brand and creating richer, web-based experiences for consumers so they can reassess our brand and start to form an opinion of Capital One.
One example is a campaign we ran last year, for wemakechangingeasy.com, which had a micro-site with lots of hosted content on it with podcasts and so on. We’ve also just started a campaign for our new World Mastercard with a micro-site that will host a lot of content.
Those efforts are to ensure we present a branded face that’s over and above traffic generation to our own website.
The second aspect is traffic generation and response. Historically, we’ve had a lot of success in our businesses driving response through the internet, and helping people to select the right product on our website.
That breaks down into three areas – our own advertising efforts, through which we form tight partnerships with some of the affiliate networks and larger players; search engine optimisation; and being present on comparison sites like Moneysupermarket, which we know consumers are using more and more to guide their product selection on financial services.
Have you gained any interesting insights into how your customers react with different online and offline channels?
It’s been changing quite significantly over the last few years. Much of the industry has seen depressed response rates in some of the offline media, like direct mail and other below-the-line media.
What that shows is consumers are changing the way they consume marketing and moving much more into a phase of active participation in product choice.
That’s a general trend, but if you look at credit cards specifically, the market for new cardholders was dominated three or four years ago by direct mail applications. The model was ‘send out direct mail to the customer, they fill out the form and get a card’.
What we’re now seeing is that model has completely reversed into an inbound model, where the customer will go on the web, read newspapers and visit consumer groups and comparison sites to inform themselves about products. We now acquire vastly more applications through the internet than we do through direct mail.
The consumer is becoming more active and is demanding a greater level of knowledge than before, and the internet is facilitating that much more than before.
The way you need to respond to that is to build a web experience that integrates through the channels. Campaign integration is something we are pushing very hard – creating a full suite of services that takes the consumer from awareness through to application as seamlessly as possible.
How has your move towards campaign integration affected how online marketing sits within your organisational structure and how it’s resourced?
We’re moving much more to a model of campaign execution, where we try and understand what the consumer wants from each campaign and build teams and agency partners around that.
I believe that at some level, the future of marketing will be like that – you structure things for individual campaigns in order to be able to flex to the different consumer demands, rather than staffing rigidly by channel, which creates channel-based marketing programmes. If you have 30 people doing direct mail, guess what? You get a lot of direct mail.
If you base your resourcing more on campaigns and what the consumer wants you to do, hopefully you get the right mix.
What are the main challenges that that model poses? What do you need to watch out for?
You have to be flexible, and there is one main thing to watch out for – you need to make sure you retain your channel-specific knowledge.
You don’t want the people in the company that are really knowledgeable about TV advertising – or internet or direct mail – to be subsumed by a campaign view. You need to combine that knowledge with a consumer view, and that’s when you hit the sweet-spot.
One key area to be flexible in is making sure that your resourcing is as responsive to the consumer, from a campaign perspective, as possible.
That means you need to give yourself time and forward-plan a lot more. We’ve found we have to pre-think campaigns a lot more than we did in the past. You need to create this rolling cycle of campaign delivery.
What KPIs are you using for your different marketing programmes?
To track our brand, we are using what I call a triangulation approach. The reason I moved us to that is in my experience, companies I have worked for have been too focused on one study.
With the classic Millward Brown tracker, where you go the market once a month – and I’m not criticising it at all, classic quantitative brand track is superb – you need to combine it with two other things.
You need to combine in it with a longer term view – a 12-to-24-month view – of where things are going in the market, and intense qualitative research to decode the numbers you are seeing. We use a range of KPIs built off that approach to see how our brand is performing in the market.
From the response side, we use a range of KPIs – cost-to-acquire, cost-per-application and looking at the efficiencies of each of the marketing channels - to make sure we are optimising all the time.
You touched on this previously, but there is obviously a lot of discussion happening on blogs, forums and other sites about credit card companies, products, charges and so on. Are you engaging in any reputation monitoring or online PR yet?
We are starting to think more about that space, so we are aware of it. We don’t have a formal monitoring process currently in place, but we are aware of what is going on.
In the future, as noise grows in that area and we can get more interesting feedback from consumers about our products, I think that will be a rich area for insight.
Did you have any thoughts on the way HSBC responded to the recent Facebook campaign against its graduate charges?
Yeah, I saw that. More and more, we are getting into this space of consumers being much more vocal and empowered by the internet. It backs up what we were talking about earlier of a much more educated, much more vocal consumer.
Because the internet provides a ready form of communication, consumers can combine together much more effectively than they ever were able to in the past, and can develop a much stronger, clearer voice that companies in the future will have to listen to more and more.
The internet - whether it’s Facebook, YouTube or email - binds consumers together. That will be very powerful going forward.
Do you see a threat from social lending sites like Zopa?
Personally, I’ve always been fascinated by those models – disruptive models that use the power of the internet to bind people together. I think it’s potentially extremely interesting, possibly not for Capital One, but in general it’s a very interesting phenomenon.
It might be somewhat ahead of its time. You should never underestimate the need for trust in financial services.
You see that exemplified in the Northern Rock example. It’s an institution that has been around for some time and is a major company in the financial services landscape, but as soon as there is any doubt over its solvency or its future, consumers react very badly.
The need for trusted providers is very key. Therefore, I think models that bring in very different ways of operating will take a reasonable amount of time to break into the mass market.
Justin will be speaking at this year’s ad:tech London, which opens its doors tomorrow.