The VP of online advertising explains how Charles Schwab’s site is both a marketing and DR channel, and about how brand development plays a role in all efforts.

Late last year, to meet the evolving needs of the aging Baby Boomer market, Charles Schwab refocused its brand with a renewed emphasis on personalized connections with the customer. To reflect this shift in brand focus Schwab reworked the "prospect experience" on Schwab.com. To learn more about Schwab's online strategies, iMedia Connection interviewed John Lane, the company's vice president of online advertising.

iMedia Connection: Since the Internet is both an advertising/marketing vehicle and a direct sales channel, how does Schwab develop its marketing plans to optimize both?

Lane: We've created Schwab.com to be a prospecting tool, by making it pay off with any drive-to-Web marketing activity, advertising or otherwise. We have established a thoroughly integrated marketing campaign, with consistent general themes that are reflected throughout the Website. When a prospect arrives, he's going to feel connected. We provide significant calls-to-action that are tied into a sales force on the back end. The phone number on the home page is one example. There are numerous places throughout the site, both contextual and promotional, that enable prospects to e-mail a question to one of our reps, after which the prospect will receive a call or an e-mail. He or she can order a piece of collateral, sign up for a workshop, or make a branch appointment. We have expanded the role of our online prospecting tool into a full-service sales experience.

iMedia Connection: What are you doing in the online space to take advantage of both the advertising and direct sales channel benefits?

Lane: Schwab online is both a marketing channel and a DR channel. When someone arrives on our Website, we want the person to take whatever action is right for him or her at the moment. Our ultimate goal, however, is to move people along. If they want to open an account with us, they can do so. If they want to learn about something we offer -- like how we conduct research -- they can make a branch appointment to speak to a rep or to attend one of our workshops. We are just now putting forth a small test for the summer and will roll it out in the fall. This will allow us to gauge results of these changes. We also want to see what happens when we engage in online activities, driving people from banner ads and contextual links to Schwab.com. How will that experience work for them -- click-through rates, back-end conversion rates? How will this compare to the first six months of the year when they were coming to us through other marketing channels.

iMedia Connection: What role does brand development have in the mix?

Lane: Brand development is critical at every contact point: in the way we train our reps and our staff at investment centers, in how we develop our Website, and what we say in our print and TV ads. When we put a piece of communication in the market, brand is absolutely critical. If you've seen any of our new creative, it's hard-hitting and apropos of where we're driving the company. We are evolving our brand.

However, while brand development from exposure to advertising is important, we tend to judge most marketing efforts by how well it drives "real business," not just "business intent" metrics. So, when we develop Web advertising programs, we create them to drive interested investors to the Web site, to a branch appointment, or to a phone conversation with an Investment Specialist. Naturally we look at results metrics that are specific to the program.

iMedia Connection: Can your company point to evidence that suggests online advertising and marketing are contributing positively to branding metrics (purchase intent, brand awareness, etc.)?

Lane: A small TV campaign can have a major impact on our brand tracking study (BTS), while a huge online buy has a hard time making a blip on the same study. It's the nature of media. It's often difficult to distinguish on an ongoing basis the impact of your online campaigns within the context of the ongoing BTS. Right now, we are working in a "test and learn" mode with online advertising. If we get to the point at which we had an established annual online advertising budget, I could see us working with our research people to disaggregate the data to see if we could distinguish the specific impact of the online efforts.

iMedia Connection: How essential is it for the industry to measure apples-to-apples by using comprehensive online reach and frequency metrics, such as online GRPs?

Lane: If you're a package goods company and you can't measure direct sales from advertising, but you want to try and measure brand attribute or purchase intent, you have to normalize the stimulus to understand the results. If you don't know your marketing or exposure volume, you can't put your results in perspective. From that sense, it's absolutely critical. I would support anything the industry does to get those basic media metrics laid-out so we can convert online buys back into those measurements, or we can plan against those measurements.

iMedia Connection: What are the obstacles preventing your company from allocating more than 1% to 5% of your marketing/advertising budget online?

Lane: Our primary obstacle is to show how our new integrated Web experience and our sales force on the back-end can effectively engage prospects that we encounter on third-party sites, rather than from our own site. If we can prove that by driving traffic to our Website we're connecting prospects to our sales force, then we've done our job. Additional funding will follow.