Regional banks frequently use geographic segmentations such as State and Direct Marketing Area (DMA) in planning media spend, but less often use geographic segmentation to determine messaging. Yet, this behavior should change during the COVID-19 pandemic.

During this pandemic, geography is going to exert disproportionate influence over customers’ financial and personal lives. Given the medium-term COVID-19 mitigation plans through the rest of this year, and likely some of 2021, it is predicted that different regions are going to have asymmetric and ever-changing guidance on movement, social interaction, and “normalcy.” As the pandemic moves towards “managing the second wave” it is highly likely that States and Municipal Governments will also adopt differing measures that will impact a bank’s geographically diverse customer base differently. As one area in a regional bank’s footprint may open for business, another city’s schools and businesses may lock down as new cases continue to mount.

These geographic impacts will take two different forms for banks and their customer relationships:

1. Regulatory: Different states and localities will have varying rules on movement, commerce, and available financial products and instruments. As a result of asymmetric state response, banks will need to manage different state and local regulations. Retail banks are already likely to have varying operational adjustments in place for:

• Branch Opening/Branch Hours
• In-person meetings with financial advisors and businesses/personal bankers
• Guidelines for social distancing in branches

In addition, it is possible that economic relief measures will also vary by state or municipality. For example, New York and California have already negotiated mandatory mortgage relief for borrowers.

2. Organic: As we enter an economic retraction, customers have demonstrated a renewal of economic regionalism - an ever-increasing consciousness around supporting their neighbors and local economy. Banks will also contend with the attitudes of local-focused customers. The COVID-19 impact has made Americans increasingly more conscientious of their local economy and the economic well-being of their neighbors. For example, the neighborhood-focused Nextdoor app is surging in popularity, GoFundMe donation pages for newly unemployed hospitality workers are filling up, and food delivery giants like Postmates are emphasizing their roles in supporting the local economy.

Regional Banks should readjust their segmentation to incorporate geographic differentiation in their online banking, mobile banking, and email platforms to address these new realities. Banks should also consider regional variations to updates for customers on services they currently offer, available relief measures, and their roles in the community.

Recommendations for all regional financial institutions

The United States has made, and will continue to make, radical adjustments in rebalancing daily life with the threat of COVID-19 on a geographic basis. Where customers live is going to greatly influence the course of their daily lives and their financial options. As regional banks consider the COVID-19 communication strategies – both during the crisis and as the crisis ebbs – they should overlay state or DMA-based segmentation into their messaging strategy in email, online banking, and mobile banking. State/DMA-specific messaging should accomplish the following objectives:

1. Inform customers on what services are fully available in their regions, what services are available with modifications, and what services are offline entirely within their regions.

2. Inform customers on what relief measures, e.g., mortgage or auto loan relief, are available to state residents and how to access those measures.

Banks should source information on current services from public entities and regulators. They should dedicate a small team within the institution to keep current on “the situation on the ground” in states and major DMAs. Additionally, banks should set up regular touch-bases with branch managers to capture all their inputs into situations impacting their branches and their communities.

One more recommendation: taking it one step further

As COVID-19 disrupts customers lives and makes people think locally, authenticity and empathy will likely outperform presentation as email marketing drivers. Banks should consider testing (or simply implementing) their region-specific emails, e.g., the subject line “(Bank) Baltimore Current Situation”, with content sourced directly from local branch employees and managers:

• Demonstrating how banks are helping in their local communities
• What services are available and how are branches adjusting to social distancing guidelines
• Showcasing local small businesses that have taken advantage of the newly established SBA loans

As financial marketers, your creativity and authenticity matter more now than any time in recent memory. While iterating and implementing your creative and authentic COVID-19 response, think locally; your customers already are.