Sandra de Castro, chief marketing officer of National Australia Bank, chats to Marketing about why she doesn’t consider herself a marketer, the campaign that made her famous and the future of banking.
Sandra de Castro first realised she was a marketer at an odd time – when she was appointed executive general manager of strategy and marketing for National Australia Bank’s business banking division.
Prior to that appointment de Castro had spent 15 years at Corporate Value Associates (CVA), the ‘global strategy boutique’, consulting for corporations world wide. Rising up the ranks from consultant to partner by the time she moved on, de Castro worked with clients in a broad variety of sectors. Over half her time with CVA was spent working for financial services providers such as LloydsTSB, ING, Société Générale, Scottish Widows and Visa Europe. She also did a fair amount of work on customer strategy with large European telcos, utilities and the car industry and the odd stint in “more exotic” sectors like hotels, the nuclear industry and waste management.
The irony of this, she says, is that she doesn’t consider herself the marketer in the team. The branch of strategy de Castro inhabited related to demand generation, figuring out how to drive the customer end of the business.
“There’s not that much difference between customer strategy and marketing strategy. So I guess that probably means I have been a marketer all along, anyway,” she says.
Marketing: At CVA you were consulting on strategy. Could you please tell us in a bit more detail about the work you did there?
Sandra de Castro: I joined CVA as a graduate, and worked my way from consultant to partner during 15 years in the firm. It’s a great place to work, and I really enjoyed my time there. I was based in London, but was fortunate to also have the opportunity to work across Europe, in places like France, Germany and Belgium.
As a strategy consultant, my main focus area was customer strategy – there was a bit of everything in that, from segmentation to CRM strategy, product and offer design, distribution strategy, pricing strategy and so on. Generally, customer-related work ended up being about 70 percent of what I did, which left room for broad exposure to other aspects of business strategy, for example process re-engineering, cost restructuring and alignment, and the odd stint in mergers and acquisitions, once for a client in Romania of all places.
Have there been any mentors you may have had over your career, and if so what specific lessons do you carry with you?
One individual who stands out in my mind is Simon Hall, a partner during my time at CVA. I worked with Simon for about six years. He is a ridiculously clever man who I learnt a great deal from – learning I still benefit from today. He was the first to show me the importance of defining value from the customer’s perspective and to catch yourself when you’re ignoring emotion as a factor.
Simon also combined very strong creativity with highly quantitative and numeric thinking, and it was an incredibly effective mix. He taught me that you can, and should, foster both. That far from being rivals, creativity and rigour are highly-complementary skill sets. I’ve found this to be just as true in marketing as it is in strategy.
Coming from a somewhat non-traditional marketing career path into a CMO role, what has been the most unexpected challenge in your role at NAB?
I came from a strategy consulting background, rather than a traditional marketing route – I first went into a business banking strategy and marketing role at NAB which was more about customer strategy and salesforce support, and then to the CMO gig for NAB as a whole.
I’d be lying if I said it wasn’t a little daunting to take on what is an unashamedly big marketing role when I’m not officially a ‘marketer’.
That said, my experience has largely been in what I call ‘demand management’ and at the end of the day that is what marketing is all about. It requires a similar toolkit. Great customer strategy starts from what’s going on in the heads of customers and where they’re coming from both rationally and emotionally, but is also acutely tuned to the commercial drivers of the business. This is tougher than it sounds, because most businesses naturally start from what they do and work backwards to the customer, rather than the other way around.
At the other extreme, it’s easy to become a ‘customer idealist’ and lose sight of the need to be commercial. I’ve found the same balance is critical in marketing.
Of course ‘Break up’ was an amazing experience – highly memorable, huge fun, and at times pretty nerve wracking, so it’s hard to miss as a highlight.
Looking back, though, the enduring part for me was the sense that we were a part of something that was core to the whole of NAB, not just marketing. We were using the tools of the marketer to shine a light on what NAB stands for, a strategy that pre-dated ‘Break up’, endures beyond it, and is deeply embedded in the organisation.
The way everyone at NAB rallied, from the CEO to the banker in the branch, was a testament to the depth of this commitment – an amazing movement to be part of.
A year and a half, almost two years on from ‘Break up’, how are you measuring the results? We heard a figure of one million new customers.
That’s right. We’ve had a million customers.
How much can be attributed to ‘Break up’, do you think?
You can never, in any business, attribute all results to a marketing campaign – of course not, like all good businesses. The thing with ‘Break up’ is it was very much integrated into the broader strategy of the business, so it sort of became symbolic for the whole business’ move to become more customer centric, which is really what gets you the million customers.
At the beginning you gave the example of, during the GFC, lending more when others were lending less. What else is following from that?
In the personal market, it really has been about the fair value agenda, and almost facing up to the reputational issue that banks have with customers, which is really that customers don’t think they’re getting value for money out of banks. The NAB, 18 months before ‘Break up’, went on a big mission to really change that. It wasn’t ‘drop’ the fee, it was either you have it or you don’t. It’s not about the price, it’s about the principle. So the business abolished a whole bunch of different fees like the overdraft fee – the thing where we write you a letter and charge you $35 for the privilege.
‘Break up’ was really the way that that was brought to life. People always talk about it being a brave campaign… it was a brave campaign, but in fact it was a little less brave than the business was to implement all this change. It was 100, 200, 300 million bucks, so it was a lot of money.
SAS: In an organisation built over the years on a channel/product alignment, how does an enterprise like a bank reinvent itself to become customer centric?
Customer centricity isn’t just a throw-away line, it’s a central part of the business strategy in place since 2009, when Cameron Clyne took on the role as CEO. He has been very focused on improving our reputation with customers, and he has not been afraid to face up to customer concerns which others in the industry have been slow to respond to. We’ve changed the way we think and do business, from the fees we charge and the service we provide in branches, over the phone and online, all the way through to how we deal with hardship and how we behave as a responsible corporate citizen.
It is a mistake to think that reputation is a marketing issue – it’s not. It’s about the way you do business, and its success starts and ends with the business, not the marketing team. We support this by finding ways to communicate NAB’s actions in a way that is compelling, but if it isn’t a real strategy, it will never make an enduring marketing message.
The other great thing about that stance over the last three years has been that it’s very motivating for our people. Employees are the biggest supporters of the reputation agenda as they too are customers and part of the community.
We were throwing around the idea of building brand loyalty within a bank to the point where you can charge a premium. That’s the opposite of what you have done here; you’ve built loyalty out of removing a lot of the inconsistent fees. Is it possible to build a bank brand and charge a premium for that?
I think people do ascribe to our strategic stance the notion that somehow it is price driven, and it isn’t, it’s reputation driven. So that’s why I emphasise it’s not about cutting a fee, it’s about charging it or not charging it. It’s a stance on what’s the right relationship that you want to have with your customers, it’s not a stance on price. If you don’t think that you should charge the people $35 to send them a letter to tell them that they’re overdrawn, which makes them a further $35 overdrawn, if you don’t think that your customers think of that as a service or if you don’t think that it’s right to do that, then you don’t do it. It’s not a discount. It’s not a price stance, it’s a reputation stance.
It seems to be all the comms that we’ve seen coming out of NAB are very, very PR-able – they’re great for a journalist to grab onto and build a story around – is that deliberate or a happy coincidence?
It’s great that you say that as journalists. I’m happy to hear that. I think the way I’d like to describe how we think about marketing is we like to use the word ‘remarkable’. Our objective is always to produce communications that are worthy of positive remark. It should be interesting enough that you want to talk about it with other people.
Now, the happy coincidence, I suppose, is that if we are successful in producing communications that do that for customers, then I guess they will probably make a story. But we’re not looking for the story, we’re looking for the communication to be worthy of conversation, remark and interest from customers.
One that came after ‘Break up’ was Commonwealth Bank’s ‘CAN’ campaign. Andy Lark came from another atypical marketing background. Do you think that it’s your backgrounds putting the energy into this space?
I don’t know. I think – yes, I didn’t come from a marketing background, but my team is filled with fantastic marketers. I think this is actually a broader marketing issue. Banks have traditionally not been marketing organisations, whereas other businesses, marketing plays a bigger part. One of the things that happens is that the marketing stops almost daring to dream, they almost stop putting up the great stuff because they’re worried that it won’t get through – and I don’t think that’s unique to banks, I think there are a lot of marketing organisations where the marketers kind of just eventually give up.
I’m sure lots of capable marketers, and I’m sure Andy Lark is among them, would have a similar perspective. But I also imagine that the fact that ‘Break up’ worked for us has probably opened up some of the horizons in other banks – I’m not saying that’s a case at CommBank, they may well have done that anyway – but I think it has had repercussions in terms of allowing bank marketing to be a little bit more interesting, which is great. It makes it more fun for us.
What would be the next big step in mobile for bank marketing, do you think? What’s phase two?
What’s phase two of mobile banking? I don’t know. I think because banking is a sort of low-interest category, people forget the scope and range of innovation that banks have actually brought to market over many years, so it wasn’t that long ago that we didn’t have ATMs, never mind telephone banking, never mind internet banking, never mind apps to do your banking on your iPhone or your Android device or your iPad. The thing with large organisations like banks is we’re always competing on that stuff, so the bar will inevitably always be raised. That’s why we talk about reputation. We’ll all go and do whatever works for customers and from a functionality sense [but] I think the game is won or lost on the longer-term perspective than the next cool thing. It’s fantastic – you’re given cool stuff to market, but I think the customer sees through that.
Something we often hear from marketers from sales backgrounds is that they have a heavy bias towards hiring marketers from sales backgrounds… do you think that’s true of you and your background and what you look for?
Do I look for strategic marketers? No, not necessarily. I look for strategic thinkers, yes, but you find strategic thinkers in all sorts of different spheres. We’ve got people from all walks and all backgrounds, and some really quantitative, square-headed modelling types, some free-thinking commercial strategists, some brilliant communications professionals, and people that are a mixture of all of the above. I genuinely believe that diversity is a source of huge strength in the team. So, no. In fact, there isn’t anybody in the team that has a background similar to mine.
This might be a difficult question having not come from a marketing background, but what advice would you give to a young marketer today?
I would go back to this point about diversity, which is that I find the best people in my team often have a very varied background. So they might have spent time in the pure brand space, but they’ve also gone and spent time in real execution, campaign-based marketing. They’ve probably gone and spent some time in the business and understand how the business looks at things. Sometimes they’ve been agency side, and sometimes they haven’t. They’ve done B2B and B2C, they understand planning and econometrics and the hardcore modelling side of things. I find marketers often get obsessed about working in different industries and sectors, and that can be great, but it doesn’t have to be that; it’s more about looking at the marketing problem from a lot of different perspectives.