BankMarketingCenter

Yes, it’s that time again: Farm Bill time. Or, more appropriately the “Agriculture Improvement Act of 2018,” as the Farm Bill is a package of legislation that is passed roughly every five years. The legislation has a tremendous impact on farming livelihoods, how food is grown, and what kinds of foods are grown. And, of course, the provisions of the bill are now being deliberated as Washington grapples with yet another potential threat of a government shutdown. This bill seems to grow increasingly complicated and harder to pass, with a history of being caught in a legislative cycle of extensions, presidential vetoes, and partisan debates.  

This from agamerica.com: “My personal sense is that we will do a temporary extension and begin work on passing a new farm bill at the beginning of next year,” said Rep. Kat Cammack, predicting a "political dogfight," as representatives battle it out on the House floor.  Other representatives, like Senate Minority Leader Mitch McConnell, believe the farm bill could be passed as soon as December 31 of this year." The current bill expires on Sept. 30, but the new deadline for a 2023 farm bill appears to be Dec. 31. On Jan. 1, 2024, some farm policy would revert to controls on production and costly price supports adopted in the 1940s.

The term “farm bill” might have been an apt description of this piece of legislation back in the ‘40’, but it’s a misnomer today. The bill addresses an increasingly critical and complex industry, covering programs ranging from crop insurance for farmers and healthy food access for low-income families to training in support of sustainable farming practices. 

So, as you can imagine, this is no small piece of legislation, either. According to the Congressional Budget Office, the 2023 Farm Bill could potentially be the first trillion-dollar farm bill in U.S. history, with total spending projected at $1.51 trillion. If you’d like to read all 807 pages of the Agriculture Improvement Act of 2018, click here.

I’m always interested in all things farming; what farmers face and the actions being taken by the federal government to help sustain this very important industry. First off, because many of the banks with whom we have partnered over the years do business with local farmers or what most small banks call their “farm families.” But, I’m interested for other reasons, too; I grew up on a small farm in LaFayette, AL. 

With hogs, horses, and 120 head of cows, I get a taste of what hard work farming is. Cutting and baling hay or repairing barbed wire fences in the Alabama heat is tough. Getting up in the dark of winter, to break the ice on the watering troughs. I know what it’s like to plant seed and hope that it rains. That’s not just a matter of hard work… It's a matter of having faith, as well. Then, there was the worry that comes with running a small farm… my dad keeping track of the cost of feed, maintenance, and supplies, especially when the price of beef would drop. 

Yes, I take both a professional and a personal interest in farming and the Farm Bill. If you’re a community banker in rural America, I’m sure you take an interest, too. Despite some gloom and doom talk about its passing, there have been some positive predictions about what it might offer. "If there's a golden nugget, it's the continuation of the federal crop insurance program," said John Blanchfield, principal at Agricultural Banking Advisory Services and a former senior vice president at the American Bankers Association. "It provides two flavors of income security to the farmer, and therefore his or her banker. Flavor one is the protection against weather-related damages — that's the traditional product. And the second is income protection, where a farmer may buy a floor price for their crop, and by doing so, the farmer has income certainty and the bank has repayment certainty."

So, what will the 2023 Farm Bill do, potentially, for farmers and community banks? 

Access to Capital

One of the primary benefits is improved access to capital for local farmers and businesses. Our farmers often require loans to purchase equipment, expand operations, or deal with unexpected challenges like crop failures or natural disasters. It’s the community bank that throws a lifeline to these borrowers, providing essential financial support that enables them to sustain and grow their businesses.

Crop Insurance and Risk Management

The 2023 Farm Bill will also play a pivotal role in bolstering risk management tools available to farmers, and crop insurance programs are a key component of this effort. These programs mean financial protection in the event of crop failures due to adverse weather conditions or other factors beyond their control. Small rural banks often act as intermediaries in the crop insurance process, helping farmers navigate the complex application and claims processes. The Farm Bill can enhance the effectiveness and accessibility of these programs, making them more appealing to both farmers and banks. 

Support for Rural Infrastructure

Another crucial aspect of the 2023 Farm Bill is its focus on rural infrastructure development. Small rural banks are intimately involved in funding and facilitating projects that improve access to essential services such as healthcare, education, and broadband internet. As rural communities evolve and grow, community banks are instrumental in ensuring that residents have access to modern amenities and economic opportunities.

Strengthening Community Banks

Small rural banks face numerous challenges, including increased regulatory burdens and competition from larger financial institutions. The 2023 Farm Bill recognizes the importance of these community banks and aims to strengthen their position in the financial landscape. It includes provisions to ease regulatory burdens on smaller banks, making it easier for them to serve their customers effectively. Additionally, the bill may provide financial incentives and grants to support the modernization of banking infrastructure and services in rural areas. This can help small banks stay competitive in a rapidly changing financial landscape, ensuring that rural communities continue to have access to reliable, personalized banking services.

More than legislation. A lifeline.

The 2023 Farm Bill is not just another piece of legislation; it is a lifeline for small rural banks and the communities they serve. These banks are essential to the economic vitality of rural America, providing access to capital, supporting risk management, and facilitating infrastructure development. As the Farm Bill unfolds, it has the potential to strengthen the foundation of rural economies, ensuring that small rural banks can continue to thrive and provide essential financial services to their communities.

Hopefully, Congress can pass the bill reauthorizing Farm Bill programs sooner than later. If not, they must pass a short-term extension. Failure to reauthorize the Farm Bill in a bipartisan manner and timely fashion will have significant impacts on local communities and economies in both urban and rural areas. And none of us want to see that happen.

About Bank Marketing Center 

Here at bankmarketingcenter.com, our goal is to help you with that topical, compelling communication with customers; the messaging — developed by banking industry marketing professionals, well trained in the thinking behind effective marketing communication — that will help you build trust, relationships, and revenue. Like these campaigns in the portal that rural banks can use to reach out to their farming families.To view our marketing creative, both print and digital – ranging from product and brand ads to social media and in branch signage – visit bankmarketingcenter.com.  You can also contact me directly by phone at 678-528-6688 or via email at nreynolds@bankmarketingcenter.com. As always, I welcome your thoughts.

It was just over a year ago that we were talking about social media in our blog “5 ways to attract customers using social media,” making the point that social media isn’t “just for kids,” and that social media messaging platforms must be an essential component of a community banks' overall marketing strategy.

Why?  Because social media IS community, which is why it aligns perfectly with community banking. Unlike the large, national banks, community banks are in the business of participating in their communities and, importantly, helping people through relationships. It’s about connecting with customers on a personal level.  And that’s what social media is all about.

The recent American Bankers Association study, The State of Social Media in Banking 2023, makes the same point, delving deeply into how banks are managing social media programs, what results they are getting, what they wish they could do better, and what opportunities and challenges are on the horizon. The report, which you can download here, wraps up with some really insightful “takeaways” and is definitely worth a read.

According to the survey of 330 banks of all sizes, nine out of 10 banks (89%) believe social media is important to their banks and 88% are very or somewhat active on their social media accounts. They’re using their social media accounts to “educate, inform, entertain, and celebrate,” with messaging that, for example:

• Promotes causes they sponsor, such as food drives or pet adoption events
• Showcases employee promotions, anniversaries, and birthdays
• Creates fun contests and giveaways 
• Promotes the benefits of products and service

Not surprisingly, the most preferred platform is Facebook (95%), followed by LinkedIn at (75%), Instagram (62%), X (formerly known as Twitter) at (41%), and YouTube at (39%). Their top uses? Communication at (89%), recruiting at (75%), financial education at (71%), marketing and sales at (59%), and customer service at (57%).

“It’s not just fun and games and warm and fuzzies,” said Doug Wilber of Denim Social. “It’s a way of connecting directly with prospects and a powerful complement to tried-and-true methods.” Russell Davis, ABA’s executive vice president of member engagement, went on to say that the report “shows that social media serves as an essential marketing channel that allows banks to connect with customers by meeting them where they are.”

I couldn’t agree more. Social media channels have become the go-to marketing tactic for banks. And that’s probably why so many financial institutions – just over 300 right now – rely on us for their social media marketing. Our goal here at BankMarketingCenter.com is exactly that - to assist banks in meeting customers where they are, with marketing materials designed by financial industry marketing professionals. 

If you’re not all that familiar with what we do, we’ve built a web-based portal that provides our partner banks with thousands of marketing materials - from social media posts, in-branch digital signage and print ads, to direct mail and statement stuffers. Our subscribers enjoy a host of benefits, including:

• Layouts that can be customized in just minutes with no software or design skills needed
• Access to millions of Getty images at no cost, and 
• ChatGPT functionality that can be a tremendous asset when crafting, for instance, a long-format piece, such as a brochure, blog, or newsletter.

There are a few additional features I think are worth mentioning. Once your ad is created, our portal will then, automatically, insert your logo, address, and phone number. It can then be automatically routed along a pre-determined, pre-arranged compliance approval path. Each subscriber also has easy access to their order history, enabling them to track all the marketing materials that are produced - an added benefit if and when, in a compliance review, they’re asked by regulators for access to their marketing materials. 

In the end, no matter how you choose to build your brand and revenue with social media marketing, as Nike says, “just do it.” And, if you decide that you need help, well, we’re here to provide it.

About Bank Marketing Center 

Here at bankmarketingcenter.com, our goal is to help you with that topical, compelling communication with customers; the messaging — developed by banking industry marketing professionals, well trained in the thinking behind effective marketing communication — that will help you build trust, relationships, and revenue. 

To view our marketing creative, both print and digital – ranging from product and brand ads to social media and in branch signage – visit bankmarketingcenter.com.  You can also contact me directly by phone at 678-528-6688 or via email at nreynolds@bankmarketingcenter.com. As always, I welcome your thoughts.

It doesn’t take much to squander good will, does it? It wasn’t long ago, remember(?) when the banking industry’s reputation was riding high, buoyed unfortunately, by a global pandemic. That rise in the industry’s rep was well documented in an American Banker article dated August 2020, “How regional banks edged out larger rivals in reputation rankings,” along with the importance of timely, relevant marketing messaging, as summed up in the chart below:

Back then, we talked – in our blog, Banker Action Figures? You Never Know…” – about how bankers should perhaps be immortalized as action figures, so admired were they for the good work they were doing for customers who were struggling financially and looking for someone (or something, in the case of their local bank) to turn to. 

The recent RepTrak survey – just made public a few days ago – tells a much different story. According to American Banker’s, “Banking crisis drags down reputations across the industry,” “the public perception of banks took a hit this year after a string of bank failures forced many customers to take a hard look at their financial service providers. The industry saw its biggest decline in sentiment since 2018, according to American Banker's annual reputation survey, with regional banks accounting for the bulk of this deterioration”. The findings are a powerful reminder that a bank’s reputation is highly vulnerable.

What happened? We know that the failure of Silicon Valley Bank, Signature Bank, and First Republic didn’t help banks, no matter their size, in terms of brand image. Back in May, we talked about how those failures could, in fact, have a silver lining for smaller banks. Rebecca Romero Rainey, CEO of the Independent Community Bankers of America, said at the time, “the failure of these institutions presents an opportunity for community bankers, who are ready, willing and able to answer questions about the latest developments at larger financial institutions.” 

Well, in this ever-evolving, financial industry landscape, just about anything can happen. And in this case, that “anything” was a host of bank failures. That’s why trust and reliability are paramount… all the time. Bank marketers must recognize the profound importance of building and maintaining a positive brand image. This is, of course, especially critical during times when customers rely on you the most; such as uncertain economic times, bank failures, or global pandemics. But, you can’t wait until that happens.

It’s pretty much a known fact that it’s five to seven times more costly to acquire a customer than it is to keep one. A significant factor in the difference in cost is that consumers tend to buy from brands they trust. This is why it takes a lot more effort to convert a new customer than to keep a loyal one. A robust brand image not only safeguards a bank's reputation, but also plays a pivotal role in shaping customer loyalty, attracting new business, and ensuring the institution's long-term success. According to Forbes, “statistics show an increase in customer retention by 5% can lead to a company’s profits growing by 25% to around 95% over a period of time.”  

So, yes, you want to keep your existing customers. But, there’s no reason why you can’t do both; keep existing customers and attract new ones. A sterling brand image extends beyond retaining existing customers; it also acts as a magnet for new ones. During those moments we talked about above, people are often prompted to explore alternative financial institutions that they believe are more reliable, trustworthy and customer-centric. Those banks that have built and maintained a strong brand image will stand out during those moments. And that’s what you want your bank to do… stand out.

Use your social platforms

Social platforms are ideal for this type of “brand maintenance.” What are some of the topics you might want to address in your messaging in order to maintain that “robust” brand? Use the “80/20 rule” when posting: Since social media seldom drives the purchase of banking related services, 80% of posts should be fun, entertaining or useful to your audience, and only 20% of content should be related to a financial product or service of some kind. Here are just a few suggestions:

• Money management “tips and tricks”
• Customer testimonials
• Community events you attend and/or support
• Staff stories:  anniversaries, promotions, etc.
• Funny, inspirational quotes/memes
• Product/service info/updates/promotion
• Success stories

So, in short, don’t wait for a crisis.

Trust, reliability, and a commitment to both personal relationships and ethical practices are the bedrock of a bank's brand image. These qualities are, of course, invaluable during economic crises, global pandemics, or personal financial emergencies. But don’t wait for a crisis to make your brand top of mind. This is an on-going process, and with the use of social media platforms, a relatively inexpensive and easy-to-implement one, as well.

About Bank Marketing Center 

Here at bankmarketingcenter.com, our goal is to help you with that topical, compelling communication with customers; the messaging — developed by banking industry marketing professionals, well trained in the thinking behind effective marketing communication — that will help you build trust, relationships, and revenue. 

To view our marketing creative, both print and digital – ranging from product and brand ads to social media and in branch signage – visit bankmarketingcenter.com.  You can also contact me directly by phone at 678-528-6688 or via email at nreynolds@bankmarketingcenter.com. As always, I welcome your thoughts.