JD Powers: Brand Image Matters Most in Selecting a Retail Bank

JD Powers has spoken ... and the Brand gods are pleased!

On July 14, JD Powers released it's inaugural study on the bank shopping ad selection process.

Financial marketers get a sharp pencil and take note:

36% of a shopper’s selection decision is driven by the bank’s brand image, while branch proximity (21%) and products and services (14%) also considerably influence which bank shoppers ultimately choose

Branch employees can positively impact a bank’s brand image by providing personal service, communicating proactively and having a customer-driven focus.

Nearly 1/3 of customers who avoid considering a particular bank altogether do so because of a previous poor service experience with that bank

Banks can use visits by non-customers as an opportunity to showcase their services and improve consideration when these customers shop for a new bank

Recommendations—both positive and negative—account for 31 percent of importance weight in a bank’s brand awareness, while positive recommendations drive 36 percent of a shopper’s consideration of a bank

Satisfaction with the account initiation process increases considerably when bank employees perform simple actions to improve the service experience when opening a new account—including greeting the customer when entering the branch, keeping wait time to five minutes or less, calling the customer by name and providing the customer with a detailed needs assessment. Among the 19 percent of customers who experienced all these actions, satisfaction scores average 890 on a 1,000-point scale—84 points above the industry average. In addition, the percentage of customers who say they “definitely will” reuse the bank for future products and services increases to 66 percent, compared with an industry average of 47 percent.

The bottom line, a dollar spent in training will yield tremendous results.  In short, your entire institution philosophy should be to treat every visitor (regardless of their balance or need) as you would treat a guest in your home: Sincere greeting, hand shakes and eye contact, talk to by name, listen before you speak, escort from point-to-point, walk them to the door when leaving.

I hope this provides some support as you strive for a budget to train your staff.

Take care,

Eric

The 2009 Retail Bank Shopping Study is based on responses from more than 7,500 consumers who shopped for a new banking account or new primary financial institution during the past 12 months. The study was fielded in February and March 2009, and includes 25 banks: Bank of America; Bank of the West; BBVA Compass; Branch Banking & Trust; Capital One; Chase; Citibank; Citizens Bank; Comerica; Fifth Third; HSBC; Huntington National Bank; KeyBank; M&T Bank; National City; PNC Bank; Regions Bank; Sovereign Bank; SunTrust; TD Bank; U.S. Bank; Union Bank of California; Wachovia; WaMu; and Wells Fargo.

Build in Volume...find a way

Greetings...

In doing one of the things that I really don't like (taking our van in for routine service) something dawned on me...and I had to share it!

At certain intervals, the manufacturer (Honda) has built in a service light on the dashboard that says "Service Engine Soon." The only way to turn it off? At the dealer! Problems? Not sure. Concerned. You bet. The final resolution? Just a normal service rotation...but it got me to act!

This is a brilliant built in provider of sales volume.

May be a little irritating, but it certainly works. I am here at the dealer (along with bunches of other people that I am presuming have a similar situation).

So the opportunity for YOU lies in your creative ability to drive volume in predetermined ways, similar to the "Service engine soon" light on the dashboard.

Find a way to drive predetermined and ACTIONABLE volume to your institution!

Be creative...listen to your front line staff and your customers...or just call us and we can help!

CHEERS!

Bruce

Business Lessons Learned From the Triathlon

As I write this, I am 72 hours from competing in my first triathlon: 1,000 meter open water swim, 15 mile mountain bike and 5 mile trail run.

I consider myself a trail runner.  In fact, until a few months ago, I couldn’t swim more than 25 yards without being winded and I could count on my fingers the number of bike miles I had ridden in years.

But I was a good runner!   Not great, by any means - I hadn’t won a race since high school – but I regularly placed in my “past his prime” age group for my monthly trail series.

Now, I can swim over a mile without drowning and comfortable bike well enough to compete … but my running miles have significantly dropped off and I haven’t placed better than 4^th in my age group all year. 

The lesson: FOCUS!

Professionally, we are being asked to do much more with much less.  The choice we need to make is: Do we want to be outstanding in one area, or serviceable in many.

The answer my be different for each of us, but ask yourself what is best for you and what is best for your institution. 

Yes, there are those gifted few who either have the DNA or unlimited time to train for all three events and who can excel in all of them.  But the fact is that there are few world-class swimmers, bikers or runners who are also elite triathletes.  You don’t see Lance Armstrong, for instance, competing in the Ironman.

Those of us with limited resources are typically best served to stay focused and excel in one area.

My suggestion?  Focus on your existing customers.  They cost the least to sell to and there is likely a world of opportunity with those customers who have already walked into your doors to begin a relationship.

You can be good at acquiring new customers and furthering your brand, but if you excel in on-boarding and customer share-of-wallet, you'll make the largest splash for the bank or credit union with the budget you have.

As for me … I’ll try to survive the swim and not loose too much ground on the bike, so I can dominate on the run.

Take care,

Eric

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

The All-Star Break...we made it!

Good morning everyone....a bright and sunny Monday to you!

Well, we made it! The 2009 All-Star break... hopefully your team is still in contention and the break will provide a needed rest. My Reds are limping into the break and a cloud is forming over the 2nd half.

The All-Star break is designed to provide a brief rest to all teams, celebrate the 1st half successes and reward the best and brightest players. It is also an organizational time to take stock in the team, analyze performance, make game plan changes, and perhaps pump up the team with new talent acquisitions.

Is your bank or CU taking an All-Star break?

You should!

Take stock of your marketing plan, analyze performance against the plan, make changes to your game plan, and take a new look at acquiring new customers, new markets, or new products...

The break is a scheduled rest point for baseball....shouldn't it be for you, too!

Have a great Monday...

Cheers!

Bruce Clapp

ALM Is Not A 4 Letter Word

Asset and Liability Management (ALM): Three little letters that few marketers want to think about.

But lets face it, given the economy, delinquencies and shrinking margins, the more intelligently we can discuss our balance sheet, the more effective our marketing efforts will be to the institution's bottom line.  And the more effective our marketing is to the bottom line, the more we can justify larger budgets (or salaries!!!)

Some Balance Sheet issues to consider:

• What is the bank's margin (essentially, the difference between what you earn on loans and what you pay on deposits)?
• What percentage of your deposits are in Time Accounts (CDs)?  What does the maturity cycle look like?
• Does the institution have a positive or negative Gap (If Fed rates drop tomorrow and your deposits reprice - what will it do to the bottom line)?

In short, are you needing deposit or loans?  Should those loans be fixed or variable?  It directly ties to what your department needs to be promoting to your customers.

Finally,  if you're not on your institution's ALCO committee, ask to sit in every so often. You'll gain a much greater understanding for why upper management may ask you to change directions every couple of months.

 If you need more "ALM 101" try:

• Take advantage of education opportunities through the ABA or CUNA
• Take your CFO out to lunch
• Call MarketMatch and let us help (sorry had to get a sales plug in)

Have a great July 4th weekend.

Take care,

Eric