Before I joined The Financial Brand in 2014, I wrote an article entitled, “7 Commonsense Ways to Increase Bank Cross-Selling‘ for my own blog. The article was the first article transferred to this website because of its popularity. Since, 2014 close to a quarter million people have read the article, which continues to be popular today.
When I go back and review what I suggested in 2014, I realize that the same commonsense rules still apply … except that they are made easier and more effective with new technologies, advanced analytics and the increased use of new channels.
As I wrote in my 2014 article, “Financial marketers need to remember that the most efficient investment of marketing funds is to market to customers that already do business with you.” Here are my revised perspectives on the same seven relatively rudimentary cross-selling techniques in a world transformed by digital technologies.
1. Start with the Lowest-Hanging Fruit
It shouldn’t surprise any financial marketer that the most commonsense way to increase cross-sales is to begin with the easiest targets. As was the case when I started in banking in the 1970s, we must start by trying to get current customers to engage more with their existing accounts. What is different from the past is that the “sticky services” referenced even as recently as 2014 have expanded significantly.
Beyond the traditional services that are included in any organization’s onboarding program, such as debit cards, online banking, mobile banking, direct deposit, bill pay and automatic savings transfer, many organizations now also encourage mobile payments, mobile check deposit, signing up for alerts and even engagement in money management tools.
To build relationships, banks and credit unions should focus on meaningful engagements as opposed to product-focused sales campaigns.
With consumers not visiting branches as often, and more likely to open an account with a digital-first competitor, the objective is less around “selling” and more around increasing engagement with your institution. With every service that you recommend, it is more imperative than ever that the experience be as simple and fast as possible.
As I said in my initial article, “Without customer engagement on the most basic product level, a relationship will have a difficult time growing.” This is more true today than ever in the past.
2. Stay Connected
In 2014, I emphasized the importance of “staying connected” with new customers once they opened a new account. While the importance of a robust onboarding program is still imperative, the focus should now include staying connected with consumers who wanted to open a new account but abandoned the process.
Research by the Digital Banking Report found that most digital account opening processes take more than 15 minutes. This complexity of new account opening results in as much as 60% abandonment during the opening process – which equates to the loss of potential customers and the revenue they generate.
To help combat this attrition of potential customers, banks and credit unions must not only improve their new account opening process, but also build in a real-time tracking system that allows for re-engagement with prospective customers who give up trying to open an account or apply for a loan. For this process to work, speed of re-engagement is imperative.
Financial institutions need to find a way to stay connected before an account is opened and throughout the entire customer journey.
Whether it is a prospect who has trouble opening a new relationship, or a new customer who only has a single account, a bank or credit union must keep the conversation going. More than ever, this communication extends beyond email, direct mail and statement messaging, to include SMS texts, online and mobile banking messaging, phone outreach, and content consumption. Remember, the new customer (or prospect) wants to be communicated with. They are unfamiliar with your organization and it is up to you to give them a reason to remain engaged.
3. Continually Evaluate (Upsell) Opportunities
Nothing has changed as dramatically as the ability to engage with a customer on a personalized, contextual basis in real-time. In the past, most financial marketers relied on product propensity models and seasonal product and service trends to build product-focused marketing campaigns.
Thanks to the combination of new data and analytic tools, combined with new marketing technology, the focus of marketing can move from a product-centric approach to the customer-centric approach, based on real-time changes in behavior as well as internal and external “signals of need.” More than ever, financial marketers have tools at their disposal that not only react to changes in behavior, but can predict needs with the use of artificial intelligence (AI) and machine learning (ML).
With these new tools, financial marketers move from trying to sell products and services to providing recommendations and advice based on perceived future needs. This is like the difference between a “rear-view mirror” engagement model and one based on a “financial GPS system.” Done well, it is the ultimate example of reaching the consumer with the right product or service, at the right time, with the right offer, delivered using the right channel.
4. Empower Your Employees
In my initial article from 2014, the title of this section was to “Empower Your [Customer-Facing] Employees.” Today, with the ability to use data and advanced analytics to create a 360-degree view of each customer, all employees can have access to insights that can improve the customer experience and expand the trust, loyalty and relationship with the customer.
With fewer and fewer customers and members visiting branches, there is the ability to use existing branch employees to reach out to customers who have been identified as having potential financial needs. From onboarding communication, to just “checking in,” these types of humanized engagements provide a differentiator compared to digital-only fintech or big tech organizations.
To facilitate these engagements, many financial institutions provide prompts on their employee’s computer screen around recent communications received by the customer, potential products and services that may interest the customer, and even special offers that can be made as part of their transaction or service conversation.
Providing easy access to consumer information also eliminates the need for customers to repeat themselves as part of customer service conversations and allows each employee in the organization to better understand the customer. This level of intimacy is expected by consumers who are used to dealing with digital organizations such as Amazon, Apple and others.
5. Ask for Referrals
As I referenced back in 2014, “One of the easiest ways to generate new business and increase loyalty of current retail or business customers is to ask (and possibly provide incentives) for referrals. If a customer is happy with the way they are treated at your organization, they usually want others to know.”
What has changed since 2014 is the ability to leverage technology and social media channels to build robust customer referral programs. In addition, for both retail consumers and small businesses, the use of social media and community influencers can be a powerful tool to generate word of mouth and direct referrals.
At a time when new customer acquisition offers often exceed $200 and when the overall cost of acquisition is more than $250, offering a reward for a “family and friends” referral through digital channels and/or social media is far less expensive and would most likely generate a more loyal customer. This type of program can also be used within a financial institution with employees receiving direct incentives.
6. Leverage Offline and Online Channels
In 2014, consumers were just becoming familiar with digital channels and social media, with propensity for digital engagement being highly skewed towards younger demographic groups. Since 2014, the use of mobile banking has surpassed all other banking channels and the use of social media and other digital engagement apps has expanded exponentially.This has not only impacted the effectiveness of alternative channels, but also the efficiency.
The shift in channel engagement by consumers to digital platforms opens opportunities for increased interaction and loyalty.
More than ever, banks and credit unions must remind customers that we know who they are, understand their needs, and are willing to reward them for their loyalty and for sharing their personal data. To earn their trust, we must provide the value they expect and the experiences they desire across all channels … seamlessly.
The move away from offline channels to online channels will continue, with the importance of embedded banking becoming a way to stay engaged 24/7/365. With embedded banking, data is used to expand relationships beyond the legacy organization, providing seamless offerings of new financial and non-financial services that the customer wants under one roof. The question will become “Will your organization be a hub for this relationship?”
7. Measure and Reward for Results
There is little new to the benefit of measuring and rewarding positive behavior. What has changed is the access to insights and results instantaneously. By providing ongoing measurement of the progress around engagement objectives you want to achieve, you stand a much better chance of reaching your goals. With or without tangible incentives, the continuous reinforcement of your expectations around customer engagement and customer experience allows your organization to shift its legacy culture.
As I referenced in my original article, current customers like to be rewarded for their loyalty. One of the best ways to do this is to keep the communication active and value-oriented. This may include an offer, but it is often enough for a bank or credit union to simply show that you know the customer, understand their needs and are working on their behalf to support a positive financial result. The customer also wants to know that your organization’s beliefs are aligned with theirs.
Empathy, transparency and the support for sustainability will help cement a relationship.