During this financial crisis, many community banks find themselves wondering how they can best protect and indeed grow their bank brand. In a financial environment where the public trust for banks has been severely eroded, this may seem like a difficult task.
However, community banks have some important advantages over the larger regional and national banks. One of these is that they remain largely unscathed by the toxic assets issue. Another is they are closer to the pulse of the communities within which they operate and so are better positioned to speak to customers and potential customers in an authentic and credible voice.
After recent discussions with community bank Presidents on this subject, I thought it would be useful to provide you with a simple check list of things to do right now that will help your community bank weather the storm.
Define what your customers really want.
Successful community banking depends on truly knowing what your customers want.
This may seem a simple task, but you need to be adaptable to changes in public opinion and really understand how people feel right now (as opposed to when you wrote your business plan) in order to take the necessary steps.
Make your service the best it can be.
Banks of all sizes know that achieving top-notch quality service is hard to do. You need to examine whether or not your community bank brand is adequately and consistently represented in all three core areas of customer service: people; process; systems. Without aligning these three critical areas, while also being mindful of your bank’s brand values, you cannot possibly attain the highest level of service
Fess-up and say you’re sorry.
The public sure is angry about this whole financial crisis and are out for blood. You can’t repair a relationship
with an angry customer who has a legitimate complaint unless you are prepared to say you made a mistake and tell them what steps you are taking to ensure that the mistake will not just happen to them again, but to any customer. You should thank them for their important contribution to making you a better bank! Then, make sure that the changes needed to uphold this promise is made and that customers are notified.
Be real.
Market consciousness has shifted considerably. The consumer is now, and will far into the future be suspicious and wary of advertising offers, special deals, slogans and potentially empty promises. They are digging much deeper into a bank’s background, personality and ethos before becoming a customer. So start making it real. You really must find a better way to connect with your customers and potential customers than the tired old picture-perfect stock photos and pictures of checkbooks and handshaking business people. So what do you replace them with? Replace them with real people with real opinions, ideas and thoughts. People connect with real people.
Always keep your promises!
Ever heard the term “Brand Promise?” It really does mean something, and now more than ever. It’s about giving the customer a clear idea of who and what you are and what difference you can make to their financial lives. You could say that as a whole, the banking industry has broken the brand promise of trust and integrity, and everyone, including small community banks, will have to work hard to earn that trust again. How does your bank live up to its brand promise? Do you even have a brand promise? If not, be prepared for the worse.
There is an old saying, "When there’s blood on the streets money will be made." Community banks now have a tremendous opportunity to re-build the trust lost by the larger banks. And they don’t have to spend a fortune. There are low cost ways of doing this right now, today. I can help you.
Contact me at 727.480.4343
Email Me
PS: A great way to achieve some of this is a bank blog: Click here for a live sample of a community bank blog.
How do successful banks build their brands? What can your financial institution do to differentiate in this competitive environment? This blog examines these issues and others.
Tuesday, March 24, 2009
There's Blood in the Street
Thursday, December 18, 2008
Bankers Beware: The Customer Will Change your Bank
By Tyrone Pardue
Your teenage kids are not the only ones enjoying the new social media networks unfolding to create an ever-evolving information exchange for the world.
Some savvy banks are employing the latest in Web 2.0 technology to keep up with customer demands. The rapidly growing body of Web driven consumers expect to help shape the brands they are loyal to.
They want skin in the game. Technology that offers your customers greater interactivity and customization of their online experience is about to forever change the way banking is done.
Banks like the Portland based Umpqua Bank and Bank of America are learning what has made Facebook and MySpace so compelling to users. They are bringing this kind of user experience to their corporate customers.
Check out the Umpqua offering here
And the Bank of America version here
Some banks are even zeroing in on specific gender niches like women’s business issues: Key4Women
Both the Umpqua and Bank of America customer space sites are stand alone branded sites outside of the main transactional Website. But watch this space! As technology improves that will change. The technology needed to ensure a ‘controlled’ and secure yet completely customizable online banking ‘dashboard’ is not quite there yet. But it’s on the way because user demand is in the driver seat. Consumers are exposed to a very high level of interactivity from their online newspapers, retailers and social media hubs, and are beginning to expect the same level of personalization from their bank.
The free-flow of information is changing politics, commerce and how people connect with society. The financial meltdown has made consumers more concerned about their banks and whether or not their bank is concerned about them. The smart thing for banks to do is connect with their customers in ways that go beyond the banking transaction by adding greater value to the banking relationship.
Providing customers with a way to interact with other business owners and share their problems, ideas and experiences can only benefit the bank and the bank’s brand. Showing your customers that you are listening to their concerns builds the relationship. But be prepared to begin thinking differently because your customer is about to tell you how to run your bank!
Your teenage kids are not the only ones enjoying the new social media networks unfolding to create an ever-evolving information exchange for the world.
Some savvy banks are employing the latest in Web 2.0 technology to keep up with customer demands. The rapidly growing body of Web driven consumers expect to help shape the brands they are loyal to.
They want skin in the game. Technology that offers your customers greater interactivity and customization of their online experience is about to forever change the way banking is done.
Banks like the Portland based Umpqua Bank and Bank of America are learning what has made Facebook and MySpace so compelling to users. They are bringing this kind of user experience to their corporate customers.
Check out the Umpqua offering here
And the Bank of America version here
Some banks are even zeroing in on specific gender niches like women’s business issues: Key4Women
Both the Umpqua and Bank of America customer space sites are stand alone branded sites outside of the main transactional Website. But watch this space! As technology improves that will change. The technology needed to ensure a ‘controlled’ and secure yet completely customizable online banking ‘dashboard’ is not quite there yet. But it’s on the way because user demand is in the driver seat. Consumers are exposed to a very high level of interactivity from their online newspapers, retailers and social media hubs, and are beginning to expect the same level of personalization from their bank.
The free-flow of information is changing politics, commerce and how people connect with society. The financial meltdown has made consumers more concerned about their banks and whether or not their bank is concerned about them. The smart thing for banks to do is connect with their customers in ways that go beyond the banking transaction by adding greater value to the banking relationship.
Providing customers with a way to interact with other business owners and share their problems, ideas and experiences can only benefit the bank and the bank’s brand. Showing your customers that you are listening to their concerns builds the relationship. But be prepared to begin thinking differently because your customer is about to tell you how to run your bank!
Friday, November 07, 2008
Star Treatment Soothes Worried Minds
By Kaplan, Liz
With more and more customers worrying about their finances and their futures, some banks are striving to “beef-up” in-branch service and be the voice of reason in an otherwise chaotic and stressful financial market.
The goal is to reach customers whose net worth isn’t high enough to warrant full private banking services but still have a selection of products across a number of institutions. Tellers and staff are trained to recognize certain questions a customer may ask and refer them to the designated consultant or licensed banker on site. A profiling process follows, including an offer of the specific solutions the bank can provide.
Although the strategy hasn’t officially been evaluated to date, more and more bankers are finding that face-to-face interactions are increasingly important as customers grow uneasy about their financial futures. Since turbulent financial markets reap havoc on retirement plans, having a trusted advisor that can help customers navigate choppy waters is especially important.
Of course, bankers who support the strategy point out that none of these programs are aimed at a specific demographic or age group. Rather, they are intended to provide broader customer service and financial intelligence to existing customers concerned about how the shaky economy will affect their financial health. That being said, these types of programs seem likely to have wide to appeal to the mass affluent, those with multiple accounts/products at multiple institutions and assets in the hundreds of thousands.
If successful, this strategy would enable a bank to reach customers who may not be high net worth but still have a strong mix of products in their portfolio including, deposits, loans, retirement plans, mutual funds and financing. By providing personal attention, solid advice, and working all sides of the balance sheet, banks can not only win their confidence but also more of their business.
They are relatively affluent, but their needs are more complicated than they want to admit. They are in a void between lower asset customers and those of high net worth provides an on-the-spot, branch level consultation to provide some middle ground
With more and more customers worrying about their finances and their futures, some banks are striving to “beef-up” in-branch service and be the voice of reason in an otherwise chaotic and stressful financial market.
The goal is to reach customers whose net worth isn’t high enough to warrant full private banking services but still have a selection of products across a number of institutions. Tellers and staff are trained to recognize certain questions a customer may ask and refer them to the designated consultant or licensed banker on site. A profiling process follows, including an offer of the specific solutions the bank can provide.
Although the strategy hasn’t officially been evaluated to date, more and more bankers are finding that face-to-face interactions are increasingly important as customers grow uneasy about their financial futures. Since turbulent financial markets reap havoc on retirement plans, having a trusted advisor that can help customers navigate choppy waters is especially important.
Of course, bankers who support the strategy point out that none of these programs are aimed at a specific demographic or age group. Rather, they are intended to provide broader customer service and financial intelligence to existing customers concerned about how the shaky economy will affect their financial health. That being said, these types of programs seem likely to have wide to appeal to the mass affluent, those with multiple accounts/products at multiple institutions and assets in the hundreds of thousands.
If successful, this strategy would enable a bank to reach customers who may not be high net worth but still have a strong mix of products in their portfolio including, deposits, loans, retirement plans, mutual funds and financing. By providing personal attention, solid advice, and working all sides of the balance sheet, banks can not only win their confidence but also more of their business.
They are relatively affluent, but their needs are more complicated than they want to admit. They are in a void between lower asset customers and those of high net worth provides an on-the-spot, branch level consultation to provide some middle ground
Monday, September 22, 2008
Marketing Remote Deposit Capture
By Pardue, Tyrone
The Challenge
In repeated surveys, community bankers rank “retaining and attracting new deposits” as their top priority. This comes as no surprise considering that the quest for deposits is both expensive and extremely competitive, burdening both marketing budgets and net interest margins.
The Solution
Thanks to Check 21 legislation, remote deposit capture has quickly presented itself as a valuable and efficient way to attract customers in the niche market of small business banking. By enabling your community bank to extend its reach far beyond your local region, remote deposit capture is an exciting vehicle to help build your brand in any market.
Embracing Change
Community banks are experiencing an industry-wide transition away from the traditional banking model where relationships were paramount and the local bank was as vital to a community as the church or school. The adoption of online banking and technologies like remote deposit capture have allowed more and more predatory banks to invade local markets. To survive in this highly competitive environment, community banks must embrace the latest marketing methodologies to package and sell their bank’s image. This can only be accomplished by building strong brands and product identities.
Making Plans
Once your bank has decided to offer remote deposit capture, it is critical that you plan your marketing initiative with the guidance of skilled and expert advice. Designing and executing a thorough campaign including writing your brochure, mounting a direct mail campaign and training your sales people to demonstrate the technology is critical to your success and requires experienced outside assistance.
Tips to Remember
How We Can Help
Once you’ve decided to offer remote deposit capture, give 8voCreative a call to discuss how we can create a customized program for your bank. Here are just some of the components we can provide to help ensure your campaign is a success:
In partnership with Diebold, 8voCreative has developed a comprehensive Remote Deposit Capture Marketing Toolkit for community banks and financial institutions.
Click here to view details.
The Challenge
In repeated surveys, community bankers rank “retaining and attracting new deposits” as their top priority. This comes as no surprise considering that the quest for deposits is both expensive and extremely competitive, burdening both marketing budgets and net interest margins.
The Solution
Thanks to Check 21 legislation, remote deposit capture has quickly presented itself as a valuable and efficient way to attract customers in the niche market of small business banking. By enabling your community bank to extend its reach far beyond your local region, remote deposit capture is an exciting vehicle to help build your brand in any market.
Embracing Change
Community banks are experiencing an industry-wide transition away from the traditional banking model where relationships were paramount and the local bank was as vital to a community as the church or school. The adoption of online banking and technologies like remote deposit capture have allowed more and more predatory banks to invade local markets. To survive in this highly competitive environment, community banks must embrace the latest marketing methodologies to package and sell their bank’s image. This can only be accomplished by building strong brands and product identities.
Making Plans
Once your bank has decided to offer remote deposit capture, it is critical that you plan your marketing initiative with the guidance of skilled and expert advice. Designing and executing a thorough campaign including writing your brochure, mounting a direct mail campaign and training your sales people to demonstrate the technology is critical to your success and requires experienced outside assistance.
Tips to Remember
- Differentiate your service by creating a distinctive brand – remote capture is exactly that – remote – it doesn’t capture the imagination!
- Create marketing materials that explain how it works in a simple way and in a manner that builds confidence and dispels doubts.
- Make sure you optimize your website and include remote capture in your cross-sell call-outs.
- On your remote capture-dedicated web page, make sure you embed the right key words to help users find it in the search results.
- Use Google and other search engines to promote your service. Since information regarding this topic is still somewhat limited on the web, you may benefit from a low cost-per-click.
- Make sure that your website has the capacity to capture leads for your business banking officers.
How We Can Help
Once you’ve decided to offer remote deposit capture, give 8voCreative a call to discuss how we can create a customized program for your bank. Here are just some of the components we can provide to help ensure your campaign is a success:
- Remote Deposit Product Branding
- Marketing and Sales Planning
- Direct Mail and Online Campaigns
- Website Optimization
- e-Marketing
- Sales Training & Coaching
In partnership with Diebold, 8voCreative has developed a comprehensive Remote Deposit Capture Marketing Toolkit for community banks and financial institutions.
Click here to view details.
Monday, September 08, 2008
Customer Focused Branding
By Pardue, Tyrone
FDIC regulations makes differentiating your bank difficult. You and your competitors are targeting the same customers, with the same products and services. Even the brand promise is the same: personal service, local decision making, a manager or teller that knows your name. But with everyone taking the same brand strategy, how do you truly differentiate?
To reach their customers, banks must create a unique, consistently branded experience targeted at the customer at point of interaction. From their first visit to your web site, to the personal banking brochure they pick up in your local branch. Here are some tips to remember when planning to build your brand and differentiate your bank:
Know Your Customer – To build meaningful relationships you must know who your customers are first. This knowledge is based on a real time analysis of each customer profile. Knowing what services they use and don’t use, provides you with the data you need to focus your brand.
Sell the Experience – Don’t just sell products and services. Be prepared to “wow” your customers by making every online transaction a breeze and every trip to their local branch a welcome experience. Don’t be satisfied with a web site that merely lists a set of bulleted services. Instead, provide compelling content that makes a true brand proposition to the reader. The same applies to branch design. Consider how your brand can be reflected in the décor, lighting and even furnishings of your branches.
Make a Difference – The ‘me’ society is changing into the ‘us’ society. Technology has connected people in new and more intimate ways. Issues like global warming, world conflict and racial prejudice are hot topics in our society and consumers expect that the brands they buy are aware of these issues and friendly to both their community and the environment.
Pulse, Pace & Passion – The world today moves at incredible speed. Devices such as Blackberries, iPhones and the Web keep life moving at a high metabolic rate. A hard-to-navigate web site, slow teller line or staff that lacks passion or personal skills are negatives that will inhibit your bank from being successful.
Brand Ambassadors – About 80% of interactions with your customer are strictly transactional. Enhance your sales and marketing interactions by building your bank’s brand from the inside out. Coach staff on ways to leverage everyday service transactions into sales dialogues, promoting both brand awareness and sales efforts with each customer interaction.
FDIC regulations makes differentiating your bank difficult. You and your competitors are targeting the same customers, with the same products and services. Even the brand promise is the same: personal service, local decision making, a manager or teller that knows your name. But with everyone taking the same brand strategy, how do you truly differentiate?
To reach their customers, banks must create a unique, consistently branded experience targeted at the customer at point of interaction. From their first visit to your web site, to the personal banking brochure they pick up in your local branch. Here are some tips to remember when planning to build your brand and differentiate your bank:
Know Your Customer – To build meaningful relationships you must know who your customers are first. This knowledge is based on a real time analysis of each customer profile. Knowing what services they use and don’t use, provides you with the data you need to focus your brand.
Sell the Experience – Don’t just sell products and services. Be prepared to “wow” your customers by making every online transaction a breeze and every trip to their local branch a welcome experience. Don’t be satisfied with a web site that merely lists a set of bulleted services. Instead, provide compelling content that makes a true brand proposition to the reader. The same applies to branch design. Consider how your brand can be reflected in the décor, lighting and even furnishings of your branches.
Make a Difference – The ‘me’ society is changing into the ‘us’ society. Technology has connected people in new and more intimate ways. Issues like global warming, world conflict and racial prejudice are hot topics in our society and consumers expect that the brands they buy are aware of these issues and friendly to both their community and the environment.
Pulse, Pace & Passion – The world today moves at incredible speed. Devices such as Blackberries, iPhones and the Web keep life moving at a high metabolic rate. A hard-to-navigate web site, slow teller line or staff that lacks passion or personal skills are negatives that will inhibit your bank from being successful.
Brand Ambassadors – About 80% of interactions with your customer are strictly transactional. Enhance your sales and marketing interactions by building your bank’s brand from the inside out. Coach staff on ways to leverage everyday service transactions into sales dialogues, promoting both brand awareness and sales efforts with each customer interaction.
Monday, March 10, 2008
Small Business Trends and Implications for Community Banks
By O'Connell, Linda
Small business banking has become the marketplace du jour for many financial institutions, especially credit card companies, commercial banks, insurance companies, and credit unions. Long considered their sweet spot, community banks are now fighting major turf battles to hold on to their precious small business customers and to retain their primary share of financial products.
Recognition of three trends will help community banks to address the changing small business banking landscape. First, as baby boomer owners sell their companies, potential market-share shifts can result from new owners switching the company's banking relationship. second, community bank brand advantages are being challenged by enhanced customer experiences at large and medium-size banks. Finally, payment methods and product innovations are luring small businesses toward other transactional and financial management alternatives.
Business Ownership Recycling Brings Opportunities
Although 70 percent of all small businesses, with sales of $100,000 to $10 million, are still owned by the founder, this figure decreased five percent from the prior year. The churn in company ownership has begun, as mature owners seek to sell their companies and new entrepreneurs enter the market. However, this initial ownership transition is just the beginning, as a potential typhoon of change is approaching.
Business consultants recommend that owners begin this transitional process about 10 years prior to the actual event. Therefore, with an average owner age of 55, and half of all owners becoming 65 or older within the next 10 years, most small business owners should be entering this process now.
The good news is that some owners are preparing for ownership succession. During 2006, one in four owners (24 percent) indicated plans to change the ownership of their companies in the next five years. Unfortunately, only half of owners older than 65 and one-third of owners 55 to 64 are actively making these transition plans. The lack of succession planning could cause the remaining companies immense turmoil in the near future.
Normally, owners preparing to sell their business do not include their bankers in these plans. According to Barlows focus group of transitioning owners, many do not think the banker adds value to the planning discussion and might even hinder its progress, especially if the company has a business line of credit. The bank that overcomes these barriers and becomes part of the owners inner circle of consultants has much to gain. Not only will it retain the company's business, but the bank builds a personal relationship with the entering and departing owners. Banks that represent the new ownership can influence a change in the company's banking relationship and gain market share.
Challenges to Community Bank Brand Advantages
As a group, community banks sit in an enviable position since they lead all banks with the greatest percentage (92 percent) of satisfied small business customers. However, customer satisfaction trends for other bank groups have been gaining. With assets of $1 billion to $50 billion, medium-size banks reached a five-year peak with 90 percent of their small business customers reporting satisfaction with their banks. Although the percentage of satisfied customers at large banks with assets greater than $50 billion has only approached 80 percent, the percentage of very satisfied customers has increased during the last five years.
Other aspects of small business customer loyalty arc improving at large and medium banks. During 2006, a greater percentage of medium-bank customers strongly agreed with many of the credit related statements (i.e., my bank "effectively meets my credit needs," "will stand by us in tough times" and "knows and understands my business") compared to the prior year. In 2006, medium-bank customers also experienced a faster response time (3.8 days) to their loan requests than large-bank (6.3 days) or small-bank (4.3 days) customers.
The customer experience appears to be improving at large banks as well. During each of the last five years, the percentage of small businesses that strongly agree that their large bank is easy to do business with has increased. During the same time frame, the percentage of companies experiencing an error during the last 90 days has decreased for large-bank customers.
Part of the reason might be traced to the increased use of Internet banking. For the last five years, the adoption rate of small businesses using their primary bank's Web site for transactions increased at large and medium banks. The adoption rate for small-business customers at small banks (assets less than $1 billion) has not kept pace and actually did not increase in 2006.
Customer satisfaction and loyalty indices still uphold strong brand advantages for community banks. The one-to-one attention and personal nature of the customer experience does achieve rewards for community banks. However, whether through credit scoring or Internet banking, medium and large banks are making progress in improving the banking experience for their small-business customers.
The Changing Landscape of Product Alternatives and Innovations
With the mix of payment methods switching from checks to electronic alternatives, banks saw the stream of small business transactions potentially moving away. To combat this trend, many banks are luring small businesses with attractive credit and debit card reward programs. Others are hoping that free online bill pay and Internet banking will be the glue that keeps the small-business customer stuck to their banks.
Small-business product packages or bundles are being developed and offered to encourage cross-selling and to make it easier for bank employees to introduce solutions for the customer. At Bank of America, Business 24/7(TM) offers online tools for payroll, invoicing, health insurance, and business credit. Digital Insight, an Intuit company, developed FinanceWorks, a small business Internet platform consisting of integrated financial management tools to solve many key workflow problems.
Meanwhile, community banks seem to be holding on to the loan relationship, as 66 percent of their small-business clients are using at least one credit product. Eighty percent of these credit products are from their primary community banks. At large banks, about half (56 percent) of their small-business customers use a credit product, and only 60 percent of these credit products are from their primary banks.
Large banks arc reacting to their lower share of small-business credit by putting decision-making back into the field. Branches are being staffed with business bankers to handle the smaller loan requests, while relationship managers arc assigned to the larger small-business clients. Loan approval systems and credit policies have been adjusted, allowing for same day loan approval and unsecured credit without audited financial statements.
What does this mean for community bankers? Competitors are reaching out to small businesses with product and system solutions to simplify their financial transactions. What community banks can control is personal and consistent contact with their small-business customers to anticipate their changing needs. While others can develop solutions, the community bank must be able to deliver them.
While staying close to their small-business customers, community bankers must be aware of the demographic changes, customer experience trends, and product innovations impacting their business. Turning these challenges into opportunities will allow them to maintain their sweet spot in the small business market.
Copyright America's Community Bankers May 2007
Provided by ProQuest Information and Learning Company. All rights Reserved
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