'Big agencies with a lot of overhead are not going to work': The CMO of Bank of America explains how ad agencies are going to have to change
- According to Bank of America chief marketing officer Meredith Verdone, everything the company does is rooted in its brand purpose of making financial lives better.
- The brand has been at the forefront of brand safety, she said, appointing Terri Schriver to lead the charge full-time this summer.
- The traditional agency operating model needs to change, according to Verdone, adding that customer privacy is the number one issue confronting marketers today.
With the chief marketing officer’s mandate going beyond brand-building to increasingly leading business transformation, their demands from their ad agencies are changing.
And agencies must reinvent themselves to meet these changing needs, says Bank of America’s chief marketing officer Meredith Verdone.
“We, like everyone, are very focused on getting streamlined and being nimble,” she told Business Insider in a recent interview. “And I don’t think the existing model, the traditional model is nimble enough to react to the pace and the speed that marketers need.”
Business Insider also caught up with Verdone, a year since she assumed her role, to chat about how the company’s brand purpose has evolved and how consumer and data and privacy are huge concerns for marketers. The conversation has been edited for clarity.
Tanya Dua: With Nike’s success, is brand purpose back in vogue? How would you crystallize your brand purpose?
Meredith Verdone: It is making financial lives better, one connection at a time, and we always use that filter. What’s interesting about Nike is, it is core to their brand purpose. It isn’t some bolt-on, where they had this great idea. They’ve been doing it for 30 years, so it was appropriate as a part of the 30 year campaign.
Everything we do, is aligned to our business and is rooted in our brand purpose. So when we do things, like our 30 year partnership with Special Olympics, it is because we value inclusion, we understand that population. We actually hire 400 people with intellectual disabilities and we recognize the economic mobility of that group.
That’s why we do it. We don’t do it because we think that’s really interesting, we do it because it’s a core business strategy for us. When people talk about cause marketing, if they’re doing it just to be relevant, that potentially has some pitfalls.
Dua: What are the biggest changes taking place in marketing today?
Verdone: When you look at how people view brands, it has evolved. Brands are not the center of consumers’ lives, but they need to help connect them to what is. We had a campaign recently where we were pretty much in the background, recognizing that our role is of a connector.
The other big shift is obviously technology, the mobile phone. People literally have all the power right in their hands. So we need to recognize that as a brand, what does that mean and what is our role? How can we make it easy and seamless?
Dua: You announced that you were appointing a brand safety officer earlier this year. Where does Bank of America stand in terms of brand safety right now?
Verdone: I would say we’re on the forefront of brand safety and have been consistently. We probably started over five years ago, doing white lists of where our ads would be. We’re down to about 3000 sites where we’re comfortable where ads are. We recently appointed Terri Schriver to focus on brand safety for full-time accountability. She’s always been doing it. We just formalized routines in terms of how we evaluate it.
We meet on a weekly basis and we look at all the issues: fraud, viewability, transparency, and we make decisions as to what we’re going to do. We are very conservative, so if there’s an unknown activity that comes up, we’ll pause all activity, we’ll do the due diligence, we’ll make a decision. If someone is blurring the line regarding what is appropriate content, we don’t want to be adjacent or there to be any confusion that that content is sponsored by us.
It’s core to our DNA as a company and our responsibility to always protect our customer, protect our brand and protect our media investment.
Dua: What are some of your other big concerns as a chief marketing officer? What keeps you up at night?
Verdone: There’s a couple of buckets in there. One is the operating model of the future. Marketing is evolving dramatically in terms of the impact it can have on business growth. And so ensuring that we have the right operating model and talent for future, which is going to be based on the intersection of technology, creative and data. And ensuring that we can pull in those insights and then deliver relevant messages at the right time and also making sure we can work in a quicker, more nimble and agile capacity.
So overall, how do we start to future-proof our marketing capability and working with our other partners? How we work with technology has changed dramatically.Dua: Speaking of technology, are technology partners, like Adobe and Salesforce, becoming more important than agency partners?Verdone: I would say they’re about even. So maybe not more so, but that is the engine, and you need to deeply understand the capabilities. You have to have a single view of the customer and understand how to connect all these systems in order to deliver different experiences to them. We’ve got 26 million mobile customers. We send out probably a billion emails a quarter.
Think about the number of touchpoints that we have, and our opportunity to understand where customers are on their journey and connect all these pieces that can vastly improve their experiences. We can deliver more personalized solutions, and even content. We’ve got a whole content series called “Better Money Habits,” for example. That might be what’s more important to them right now instead of understanding what products and solutions we have.
Dua: How do you decide where to spend your dollars, where your marketing budget is going?
Verdone: We focus on where our audience is, everything is audience-led. We’re working on the right measurement to help us continue to improve that ROI, improve the mix. Digital is an increasingly important component. It’s a combination of channels. We do partnerships, we have programmatic, and we’re still in some of the big places where you get the big audiences.
Dua: As a financial services brand, you have access to a lot of consumer data. How are you using that to tailor better experiences for your customers?
Verdone: Erica is our virtual financial assistant. It is AI-based and it’s continuing to learn. We’ve only been out there less than a year, and we’ve got about 3 million users. What the capability is, is to be predictive based on your past habits. So you can log in and say, ‘Hey, you know, how much have I spent on so much in this month?’ So it is really helping people plan and budget. So when someone asks Erica question, that could be an opportunity to serve them based on information we may already have.
Dua: What do you think of the current agency model? What does the model of the future look like?
Verdone: One of the most important assets in our business is creativity. And I don’t think we’re ever going to fully in-source creativity, because not every creative person wants to work at a bank and a lot of creative people want to work on different things. What’s changed is how you source creativity and what are now the ingredients to drive creativity. Data is now the big enabler as it leads to insights, which are going to drive better creative.
How you’re really taking that data to drive greater insights to get better creativity is going to be the model that’s going to win, and it might be a in-house agency or an external agency. I don’t know what the exact model is, but these big agencies with a lot of overhead are not going to work, because we, like everyone, are very focused on getting streamlined and being nimble, and I don’t think the existing model, the traditional model is nimble enough to react to the pace and the speed that marketers need.
Dua: What are your relationships like with with the platforms? Facebook has had an issue after another, with the data breach being the most recent one.
Verdone: Customer privacy, is the utmost, number one issue. We look at whatever the right strategies are to ensure that we’re safeguarding customer privacy. With the platforms, these are longstanding relationships. But we’re pretty demanding, people would say that we are tough customers and have high expectations and we continue to have a lot of dialogue with both of them.
On the privacy front, we need to ensure that there’s full transparency, and that people understand how data is being used. As an industry, we’re just getting there. I do think that GDPR and the impact that it could have, could ultimately be extremely positive whereby people understand how their data’s being used and can choose to opt in and can see what the value is. There is a value exchange, but it needs to be fully transparent and customers need to have that visibility and opt into it.
And it won’t just be limited to Europe. There will be a tipping point with regulation.
Dua: Apart from AI, are you bullish on any other emerging technologies?
Verdone: Voice is going to be really interesting, how we integrate with voice, how people’s behavior translates and what that means for a brand. That’s a really exciting, next evolution of consumer behavior.
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