Community-based institutions must serve a specific niche in order to survive. Do you know what your unique position is in the market? Or do you have a generic brand? A marketing plan is just not enough.

The typical marketing plan outlines goals for the year, audience targets, products to be promoted, budgets and timelines. A combination of strategy and implementation, marketing plans place a strong emphasis on execution, and lay out how things will get done, when, and for how much.

But most marketing plans are written to focus on the trees instead of the forest. Consumed by executing the plan, practitioners tend to overlook what’s going on in the surrounding forest. Marketers need to continually evaluate the institution’s role within the broader banking community, and ask, “What niche has enabled us to survive when others have failed?” Does that niche guide the organization’s business plans and executive decision-making?

Niches are not idle theory. In today’s highly competitive business environment, financial institutions face a serious problem: consumers think all banks are alike. If prospects see little difference between banking providers, how will smaller institutions avoid being dwarfed by megabanks with their massive advertising budgets and slick mobile technology?

Reality Check: Smaller institutions cannot survive without a well-defined niche.

Your institution needs a brand position that summarizes your institution’s niche. This is something you should be able to share in a three-sentence elevator speech — something that quickly encapsulates who you are, who you serve, what you do, and what makes you different. Having a brand position like this provides tremendous focus and clarity across the organization. Inasmuch, it serves as a strategic compass for marketing, ensuring that programs don’t drift off course (something that can easily happen when certain people in your organization start “brainstorming”).

All banks and credit unions have a niche, even if they’ve never taken the time and energy to spell it out in a formalized brand position — in many cases, the institution’s position is crystallized only in the mind of the CEO — but there are always reasons that specific audience segments will gravitate to any particular provider. Identifying those reasons and the consumers they attract are a fundamental component in every successful marketing plan.

Reality Check: Service is not a good differentiator. Too many financial institutions claim “quality service.” If you can’t name something better and more specific than “service,” you probably don’t understand the niche your institution serves and how you fulfill the financial needs of your the community. In which case, you are at risk of having a generic brand.

Generic banking brands reflect the herd mentality that plagues the industry — thousands of institutions pushing the same products, promoting them in the same way, based on the same strategy that’s built on the same bromides and common assumptions.

But filling a niche means taking a different path than your competitors down the street. It involves promoting products that others may ignore, and looking for unconventional ways to express your unique identity. Generic marketing rarely emerges from an institution with a well-defined niche (i.e., brand).

Keeping your niche top-of-mind is a helpful guide when making strategic decision — selecting programs and prioritizing activities, assigning resources and ruling out distracting but tempting alternatives.

Here at Liberty Bank, we understand and embrace our niche. Liberty is an old community institution in northwest Chicago focused on acquiring mortgages and savings. No credit cards, automobile or educational loans are offered. The average age of customers is 62; CD holders average 71. And, as with most community banks, we have email addresses for only about half our customers. Our niche and marketing strategy is notably different than that of big national banks. Their marketing sweet spot is Millennials, we target Boomers. Their lead product is checking, ours is mortgages and CDs.

Megabanks want Millennials, and rely on big advertising budgets, big checking bonuses and slick technology to get them. But that strategy doesn’t make sense for us, nor for many other community-based institutions. Liberty Bank customers want mobile services but they are not aggressive early adopters of tech; indeed, product education (e.g., hand-holding) is an important marketing component of the Liberty Bank strategy.

Without credit products, Millennials are not profitable and probably won’t be until their mid-thirties when they start thinking about buying a house, building a college fund or socking money away for retirement. But chasing Millennials can be a losing proposition for another reason. In the 2015 Consumer Digital Banking Survey, Accenture found that 18% of Millennials switch banks each year, compared to just 10% of customers 35 to 54, and only 3% of those 55 and older. Not only is it expensive to maintain these accounts, there’s little chance of keeping them over the next 15 years. It makes more sense for Liberty Bank to target two markets: middle-class Gen X’ers (32 to 47 years of age), and Baby Boomers nearing retirement. That’s our sweet spot.

For a community bank, Liberty Bank’s focus suggests an acquisition strategy focusing on the family — petting zoos and family concerts, financial literary programs and school partnerships. College savings programs and debt reduction seminars address the mission of increasing savings and reaching young parents. An ongoing program gathers names, and a “drip campaign” nurtures relationships.

Fintechs and credit unions tend are more naturally niche players. Fintechs like to slice off a small piece of the banking puzzle and build their marketing strategy around it. Credit unions were historically created around clear and narrowly-defined niche segments (e.g., teachers, firemen, government employees). Sticking with a niche like these can help banking providers ride the waves of change, because those institutions tend to have fewer competitors... and wider profit margins as a result.

(Contributing Source: Op-Ed from Kevin Tynan via thefinancialbrand.com. Kevin Tynan is Senior Vice President for Marketing at Liberty Bank for Savings.)