Managing To The Customer's 1%

Lets face it.  Regardless of your great checking product or competitive rates or fancy branches, when it comes down to it, customers really want convenience and assurance.

 

The convenience is the acquisition phase. In most cases, the FI with the most branches wins market share.  But we can get into the discussion of covering the footprint vs brand awareness and differentiation in a different blog.

Today, I want to discuss retention and relationship depth … the assurance phase.

When it comes to existing customers, here’s the REAL secret …

99% of the time, your customers just want you to do your job!  Don’t screw up!

It’s what happens in the other 1% of the time that really helps you to stand out. That other 1% -- when they’ve mismanaged their budget, want to make a major purchase, are experiencing a significant life change, need guidance.

Our rally cry as bankers should be to shine during the customer’s 1%.

• Train to spot the 1%: Your staff should understand this 1% rule and know the difference between a need to simply do their jobs and a need that will change a customer’s life.
• Life Stage: To help identify many of your 1% situations, understand the events in a typical life cycle that impact someone’s finances.  Define the events, understand the customer needs, present solutions, provide front-line tools and train, train, train.
• Tell your story: Your staff impact customer’s lives every day.  Your bank or credit union has helped many customers tell their life stories.  You’ve helped them buy their first home, manage their budget so they can keep their home in times of trouble, you’ve helped to retire early or restructure finances when priorities change with the birth of a child.  You should share these stories inside and outside of your branches.

Being prepared for the customer’s 1% will help to create more loyal customers, will increase referrals, and will help deepen relationships.  Keeping their accounts accurate and not charging ridiculous fees is expected – for the day-to-day stuff, people only notice when you drop the ball.  But, being there for customers when they REALLY need you is what gets them talking and keeps them with you.

MarketMatch is a full-service marketing consulting firm, dedicated to the credit union and community banking community.  We utilize knowledge-based strategies to help you FOCUS on the efforts that will generate MOMENTUM and yield the greatest RESULTS for your bottom line.

Learn more here.

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Referrals: Don't Forget to Ask!

Obtaining referrals is not only simple, it’s cost effective! Plus, it can be a great addition to an ongoing marketing strategy for your relationship managers. All you have to do is ask customers, members, peers, or associates to recommend you. So why do so many bankers fail at this tactic?

Many people believe that doing a good job is all that’s necessary to generate referrals. However, business owners, professionals, customers/members, etc. have other things on their minds than rewarding your service when you are meeting with them. Simply put, you need to speak up!

Here are 4 simple tips to help increase success of your referrals:

It’s not about the size of the prize. Few people refer to get a reward. On the contrary they may like to be viewed as the person who is “connected.” Save the $20 referral reward and invest in your customer/member relationship by taking them to lunch instead.

Wait until customers/members are happy. After you go the extra mile for a client… then ask. They will be so happy with you, they will want to return the favor.

Don’t worry about rejection. – If someone doesn’t know anyone they could refer you to, they’ll tell you. But if they don’t give you a referral, that doesn’t mean that they wouldn’t in the future. It doesn't hurt to ask.

Simplify the process. Whether you decided to ask for a referral using an email, mail, or in person, make it a seamless part of your marketing plan. Automate the process or putting tools in place for relationship managers to refer can help you in the long run.

And while I’m at it… if you are happy with the knowledge MarketMatch provides and you know someone who could benefit from our services, please give us a call our drop us a line.

Best,

Jamie

6 Ways to Pinch Pennies and Grow

Don't let a tight budget stall your growth.

As marketing professionals, you're being expected - ney, demanded - to do more with less. The good news is that it simply takes some creativity ... and who has more creativity than us marketers?

Here are 6 ideas (some creative, some not) to help jump start the ol' mellon and get those neurons firing. Please, please, please feel free to add more by commenting to this blog.

6 Penny Pinching Ideas:

1. Create a referral program

OK, it's nothing new, but your existing customers can be your best asset. And let's face it, no matter how big you are - you have a lot of customers. It can be as easy (and cheap) as printing small, pocket-sized cards offering $5-$25 for the customer and their referred friend. Make sure you offer an incentive to both.

I've had success printing a brochure-sized piece with 4 business card sized offers of $10 to each - saying: Earn up to $40 by spreading the joy. Quarterly, I'd include it in newsletter mailings to all customers and watch the spike in new accounts.

The keys: Keep it easy, Keep it trackable, Make it fun.

2. Internal promotions

Don't want to incentivize your customers? Use your NEXT best asset - your staff. Make a game of which branch can recruit the most new customers. Offering incentives to a smaller group of people (or teams) will be easier on the budget.

3. Get out of the office

You should, of course, participate in the local Chambers - but how many bank/CU employees are out on your behalf? At a minimum, all senior management and board should be expected to be active in the community and promote the institution.  

The key: From church elder, to scout leader, to chamber committee member, there are plenty of opportunities to contribute - just make sure that promoting the bank/CU (elegantly) is also being done.

4. Bank@Work

Many credit unions have already mastered this - but, with a community charter focus and limited resources,  many more have forgotten this art.

Whether you call them SEGs or Commercial Clients, you have customers who have employees. And those employees are prospects. Find ways to communicate with them.

The key: Make sure your commercial staff teams up with your retail staff and vice versa.

5. PR - or "Image Management"

Your institution has a wealth of interesting stories that are likely overlooked because, since you see it everyday, you don't look at them as newsworthy. I'll bet your local news outlets (hungering for good news - especially from local financial institutions) would disagree.

• You mean banks ARE lending?!?!: Let them know how much you've lent to date. Even if it seems small by your standards, to "Tammy the teacher," it will seem huge.
• Case studies: Have you saved a family from foreclosure? Helped a kid go to college? Helped a student afford a trip overseas? Your staff do amazing things for customers everyday - it's the beauty of their job. Collect and share those stories.
• Share your expertise: Few understand finances better than bankers (at least lets hope so!). Be the local resource for sound financial guidance. In this economy, you may be able to work out a deal to author an ongoing "Smart Finances" section - aim high!

6. Fish where the fish are

Focus your budget on your existing customers, there are fewer hurdles - so it's the smart spend.

• Focus on customers with only 2 or 3 products: Single service customers are likely single service for a reason - build the relationship with those that have multiple, but few products.
• Look at depositors with no loans - especially mortgages. Don't reprice existing, but try to get customers with other institutions mortgages to refinance with you.
• What about depositors with no checking: Get them to view you as their primary financial institution.
• What unused HELOC balances are out there?  Go get 'em.

For at least the next six months or so, we will have to work a little harder to maximize our budgets. You don't necessarily have to spend a lot to gain a lot - you just need to be creative, utilize your entire staff and have fun.

Take care,

Eric