January 23, 2008:  Whenever I have a chance to make personal presentations regarding bank marketing, I like to bring along examples of letters sent to me from Washington Mutual.  I find their direct marketing a useful illustration of what not to do.

Now, I'm afraid, my source for bad examples may go way. 

News sources indicate that JP Morgan Chase is close to finalizing a deal for WaMu, the nation's largest savings and loan.  Washington Mutual, once a leader for innovative branch design and known for rapid national expansion during the 1990s, suffered recent losses in it's mortgage portfolio.  But this West Coast banking giant likely could withstand the current housing marketing downturn if WaMu's board can stomach a year or so of lower earnings.  What it may never be able to overcome is poor marketing practices.

My observations here are limited to the Chicago market, which WaMu entered in 2003 and currently operates 143 branch offices.  

Because WaMu purchased my mortgage, I receive marketing materials from a local office.  "Wow!" I thought looking at the first correspondence sent to me by the nearby WaMu branch. I was impressed that, of the hundreds of bank solicitations sent to me each year, this was the first that was hand addressed—a real personal touch. 

But I've now come to expect that WaMu's envelopes include content somewhat less personalized.  Most often, their outers contain a black and white Xerox copy of a promotional offer where the person who addressed the enveloped took the time to, in fill-in-the-blank fashion, add my name.  The form letter, when run through the copy machine, is usually crooked on the page. 

Sometimes, the Bank piggy-backs other offers on the reverse side of these Xerox direct mail efforts.  What do they want me to do, open a CD or take out a loan?  I guess they haven't profiled me very well.

So, while the outer can make a good impression—providing that the handwriting is neat and not childlike—the contents leave a poor impression regarding the capabilities of this otherwise respected institution.

Last November, I received a similarly formatted letter from a local mortgage officer (See below).  Not impressed with the look of the form letter, I nonetheless took time to read the offer.  And I bit; after all, who doesn't want to save on their mortgage these days?  The letter closed with, "Don't hesitate to call."  So, I called and left a message with the mortgage officer's voice mail. 

That WaMu letter set next to my phone at the office ready for the call back.  After a week of waiting, I followed up using the officer's email address.  A month later, I found the original letter on my desk, and once again emailed that same person noting my previous efforts to reach him.  I might be wrong, but I think customers deserve better treatment.

Earlier this month, I called and left a message again asking for a callback—my fourth attempt to respond to this solicitation.   About an hour after I made this last call, I learned from the radio that WaMu had just announced it would close 25 local suburban offices, the second time the Bank had opted to close Chicago area branches in two years.  I felt bad for the mortgage officer I had tried to reach as his office was one of those scheduled for shut-down.

So, in the face of WaMu's lack of success in the Chicago market, I have to wonder whether they expanded too fast, or did cutting corners on marketing expenses and poor customer service contribute to their difficulties? 

I think it is difficult to get customer service employees to execute marketing plans, like hand addressing envelopes, and also ask them to be proactive in sales and service.  But WaMu's marketing failed because, in their efforts to cut costs, they lost sight of marketing basics.  They didn't target their cross-sales efforts; they weren't clear about the product they were promoting; their letters didn't look professional or business-like (which I found, as a customer, insulting); and worst of all the employees don't follow-up with those that do respond.

One of the fixtures at Chicago Cubs home games is "Ronnie Woo," who cheerleads throughout the game and often, and loudly repeats, "Wu-wu" over and over and over again.  I guess that opposing teams find Ronnie's chant annoying, but they somehow tune "Wu-wu" out.  Consumers in Chicago must be finding WaMu local marketing annoying, and like Ronnie Woo, you just tune it out.