While FinTech startups are experiencing (I wouldn’t say enjoying) a very unique competitive scenario today, yet their marketing strategy model shouldn’t be so different from the one MarTech, Tech, FinServ (in its largest definition) companies are adopting.

Strategy is designing a way to deal with a challenge, as I explained in a previous post. Strategy is working out how your existing assets can overcome this challenge and be used to flip the board and then crushing your competition as a result. A good strategy, therefore, has to: 

  1. identify the challenge to be overcome, and 
  2. design a way to overcome it

This is where I would start, regardless the sector. Richard Rumelt, author of the book “Good Strategy, Bad Strategy“, suggests using a simple yet powerful model, the strategy kernel. The kernel of a good strategy contains three elements: a diagnosis, a guiding policy, and a set of coherent actions.

Strategy Kernel
The Strategy Kernel

In addition, I would take into consideration for FinTech a “two-speed” marketing model, with a proper blend of short-term activation and long-term brand awareness tactics.

All marketing actions have both brand and activation effects. But the mix varies, depending on targeting, copy, medium etc. Evidence suggests there is a trade-off between brand and activation effects. Activity that is good at one tends to be poor at the other. It is not too hard to divide marketing activities into those that work primarily by brand effects and those that primarily work by activation. Note the word “primarily”.

The last few years have seen short-term marketing techniques as companies’ first priority, in many domains, especially in Financial Services. These companies have invested most of the marketing money in short-term, fast-return campaigns driven mostly by online paid media programs and related content, in the hope to lift sales for the next few quarters.

Data (source WARC) show a dramatic shift to digital advertising for FinServ companies over the last five years. Digital advert spend has grown to 45.5% last year.

Over the longer term this short-termism has rapidly deteriorated the brand and the overall impact of marketing. Too much time spent picking the low-hanging fruit means less time watering the tree. Eventually the tree stops growing.

Short-termism is especially visible in sectors like Financial Services, including FinTech

Brand building and sales activation are not choices or alternatives – they are mutually interdependent and both are essential to long-term success. For this reason I would focus on both activation and brand building, at the same time.

Focus on short-term activation:

  • strong emphasis on mobile
  • a powerful content marketing targeted on consideration/purchase (gated content, leadgen, CTAs, etc.) and distribution on specific channels (based on audience preferences)
  • integrated organic SEO + PPC on specific keywords
  • hyper-targeted paid media
  • retargeting 
  • leadgen events
  • etc…

And then focus on long-term brand building – again, at the same time:

  • content marketing targeting awareness (videos work beautifully to explain hostile financial concepts)
  • TV advertising (for B2C FinServ/FinTech)
  • OOH adverts (for both B2B and B2C)
  • mass (or sophisticated mass) branding campaigns
  • events & sponsorships
  • partnerships
  • PR and AR
  • etc…

As far as the marketing budget, while Field and Binet suggests a split with a large predominance of brand building investments, I would go for a mildest approach – starting with at least a 20-30% investment in brand building and increasing the investment year after year, up to overspending competition, in order to increase market share, as confirmed by the ESOV law.

Financial service should invest more in brand building, considering the excessive focus the sector had on activation for the last few years

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