By late 2009 community banks had already seen some success in their efforts to differentiate their public image from that of bigger banks, whose financial woes and risk taking had drawn the ire of both politicians and the public, points out Karen Tyson, SVP of communications for Washington, D.C.-based Independent Community Bankers of America (ICBA).
"ICBA has been working really hard to separate the community banks from the larger institutions, and we have had significant media coverage," she says. "The word has gotten out that community banks are different from the bigger banks, and that they weren't a part of this crisis."
In an effort to avoid being painted with the same broad brush as their too-big-to-fail counterparts, community banks are finding increasing value in the Web as a means to get their message out to the public.
A Level Playing Field
Large banks have a distinct advantage when it comes to leveraging more traditional channels to win the hearts and minds of customers -- after all, the big banks have more money to play with and typically are more politically connected. By it's nature, though, the online channel helps level that playing field, giving equal weight to competing messages from banks large and small.
Take the Huffington Post's high-visibility Move Your Money campaign, for instance. Just before the turn of the New Year, Arianna Huffington, the blog's cofounder and editor-in-chief, co-wrote a blog post with Rob Johnson, director of the economic policy initiative at the Roosevelt Institute, that urged readers to move their money from accounts based at large institutions to accounts at small community banks. "Why don't we take our money out of these big banks and put them into community banks?" Huffington and Johnson wrote. "And what, we asked ourselves, would happen if lots of people around America decided to do the same thing? Our money has been used to make the system worse -- what if we used it to make the system better?"
Coupled with a Web site, MoveYourMoney.info, the blog post asks readers to pledge to switch banks. The site also directs interested parties to healthy community banks via a zip code-based online search tool developed using bank ratings from Institutional Risk Analytics (IRA), a Torrance, Calif.-based risk management and advisory services firm.
According to Sterling National Bank chairman Louis Cappelli, the Move Your Money campaign has had a significant impact. "From a marketing perspective, there are aspects of the Move Your Money campaign that resonate with Sterling's audience, particularly the substantial emphasis it places on service as a key ingredient in attracting and retaining customers," he says.
While he declines to discuss specific numbers, Cappelli says the Manhattan-based bank's Web site has seen a large spike in traffic since the Huffington Post piece went live on December 29. In addition, the community bank has enjoyed a streak of good public relations opportunities as a result of the campaign, including an instance in which a news team filmed a new customer who opened an account with the bank as a direct result of the Move Your Money movement.
The Great Divide
The ICBA has recognized the value of a strong online presence for quite some time, the association's Tyson suggests. Most recently, she notes, the organization's president and CEO, Camden R. Fine, launched his own blog, which he uses to communicate with ICBA members and the greater public. Launched in mid-January 2010, the blog -- Finer Points (camfine.wordpress.com) -- has served mainly as an outlet for Fine's views on the divide between larger institutions and community banks.
Tyson says the ICBA carefully considered the value of the blog, but once it decided to go ahead with the idea, the organization was able to launch the site in just two weeks. "We basically looked at it as another avenue for [Fine] to communicate with our member banks, community banks at large and anyone else ... in a quicker, more immediate way and in a little bit more of a casual way," she explains.
In his second post, Fine addressed the Huffington's Post's Move Your Money campaign. "Isn't that just what ICBA has been saying for years and been trumpeting especially loudly the past two years?" wrote Fine, who was not available for comment for this story. "It's gratifying to know that we've been so successful in getting our messages out that we've helped spur this very pro-community bank, populist campaign.
"Unfortunately, solving the problems that led to our financial crisis isn't as simple as just changing banks. If we really want to put an end to the too-big-to-fail policies that brought this country so close to financial collapse, we've got to hit the big guys where it hurts -- passing legislation and regulations that will finally rein in the risk taking and limit the size and scope of systemically dangerous institutions."