Broadcast television is fighting to remain relevant. Fifty years ago, the three major American networks — ABC, CBS, and NBC — were the primary source of televised entertainment. They reached all the nation’s TV viewers. Since 2002, however, they have seen their audience decline 50%. The big three aren’t so big anymore and they’re struggling to remain relevant in the face of competition unimagined just five years ago.

Cable TV, once the smart, hip upstart to broadcast television is struggling, too. Burdened down by an expensive wired network that once promised a myriad of choices, consumers — particularly Millennials — are pulling the plug and switching to cheaper, custom-tailored options. Netflix and Amazon have eschewed distribution through cable systems and struck out on their own. Microsoft and Elton Musk are said to be building a global wireless network which may further erode the cable and broadcast franchise.

Despite their travails, both industries are still around, and they offer lessons in managing and surviving change that may be instructive for banks.

The key takeaway is that survival may depend upon sidestepping aggressive competition by finding and marketing to specific niches. Whether by design or accident, broadcast and cable channels have a done a masterful job of catering to niches.

Competitors may have siphoned off broadcast audiences, but there remains a few, unique events that deliver huge numbers: breaking news and major sporting events. No competitor can serve up mass audiences like major broadcasters. National or international news requires the extensive news-gathering resources of a corporate giant. ESPN may sponsor sporting events, but the majors broadcast the largest sporting events — the Super Bowl and World Series.

Cable channels are surviving because they focus on narrow niches where there is less competition but deliver a demographic or lifestyle population that’s attractive to certain advertisers. The Food Channel, Comedy Central and National Geographic appeal to distinct demographics. Growth may be limited but profitability isn’t. Identifying and catering to the right audience can ensure a bright future.

What’s This Have to Do With Banking and The Super Bowl?

Parallels to the financial industry are stark. The overarching theme? Resistance to change. Aging dinosaurs being nipped by young upstarts. Regulatory protections lifted.

The big banks appear to be fine — until virtual banks and online brands like Apple and Pay Pal steal their customers — then they will be scrambling to cut expenses, lay off personnel and shed the brick and concrete anchor around their necks.

Community banks are another matter. Banks less than $5 billion are closing or consolidating in dramatic fashion. Survival is the big challenge for an estimated 2,000 banks.

In the old days, a bank charter was a license for making money. The charter came with operating instructions and protections against competitors opening next door. Congress set interest rates. Unit banking states such as Illinois prohibited branching altogether, thus restricting competition even further.

Those days are gone, but community banks, for the most part, still following the same operating procedure. Competition is attacking from all sides but smaller FIs keep their heads down, plow forward, follow a slew of new regulations and hope things will work out. They won’t.

Community banks need to follow the example of the broadcast networks and the cable channels who saw a declining market and picked customer niches that offer profit and a future. Community banks don’t have sufficient resources to fight the army of competitors gathering around them. They rarely demonstrate entrepreneurial spirit, either; it’s not fostered by a culture of rules and regulations.

Niche marketing is already working for some community banks. Commercial and private bankers that cater to the top one-per-cent, seem less vulnerable to snippy upstarts. And lenders who specialize in particular types of loans, such as Illinois-based Evergreen Bank Group which finances motorcycles, enjoy a degree of marketplace protection.

Community banks cannot remain everything to everyone, or they’ll be nothing to no one.

The first step in identifying a profitable niche is to analyze your customer base. That starts with an analysis identifying your most profitable customers, assigning growth potential multipliers to each, and further appending geo-economic and lifestyle data to paint a richer picture of accountholders. From the results, high profit clusters will likely emerge — customer segments with common characteristics. The segments can provide powerful insights for strategies and tactics.

Nielsen, the research firm, divides every US household into 66 segments based on demographic and lifestyle types using such colorful names as Kids and Keyboards, Heartlanders, and Young Digerati. Once appended to your data, you’ll have a picture of the groups drawn to your services. Take a look at the segmentation clusters in your area by plugging in your ZIP code at this website from Claritas. Nielsen also has a similar segmentation system based exclusively on use of financial products.

Although certain niches will emerge, you’ll need to apply a profit potential multiplier to ensure your focus is in on those with the best prospects.

Analyze your three top segments. Conduct customer surveys. Find out what you do well, where you need improvement, what they want. Your marketing strategy should be around meeting the needs and habits of your top two or three groups.

You may end up with three compatible niches, but that should be enough to give direction to your future marketing efforts.

Here’s a final lesson from the broadcasters: smaller audiences are worth more.

Advertisers paid roughly 10% more for spots during this year’s Super Bowl. It’s a classic “supply vs. demand” issue: as the big, unfragmented audience declines, a focused audience niche actually becomes more valuable.

There’s no rule that says banks must serve everyone with a wallet and a pulse. You can — and should — focus on a specific niche market or segment as well.

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