Moving Beyond Traditional Bank Cross-Selling

As banking shifts from a product-driven model to a demand-driven orientation, the focal point becomes the consumer. Financial services firms need to change their cross-selling strategies to align with this new reality. Leveraging expanded data insights and a customer-first positioning will enable a more compelling customer experience resulting in greater sales, loyalty and share of wallet.

According to a Gallup study covered by The Financial Brand, financial marketers need to improve cross-sell communications with current customers. In the research, it was found that 66% of ‘fully engaged’ customers felt the offers they receive were ‘general’ in nature, 41% found the offer annoying, and stunningly, 53% of customers already had the product being promoted. Of significant concern is that the most engaged customers (the ones most likely to buy) felt they were targeted worse than those who were less engaged.

In another study done by Deloitte that was analyzed by The Financial Brand, “Banking Needs to Reassess Cross-Selling Efforts,” it was concluded that banking needs to go beyond demographics and understand the behavioral and attitudinal traits of the segments to redesign their channel strategy and communication plan. Now, more than ever, banks have the ability to leverage enhanced data analytics to provide offers based on customer attitudes and perceptions.

So, how can your organization go beyond traditional cross-sell strategies?


Segmentation is a common way to incorporate customer attitudes and is extremely powerful in bank cross-sell programs.  There are an infinite number of ways to segment.  Although the Deloitte article references 4 segments they developed (basic users, value shoppers, diversifiers, and consolidators) to improve cross-selling, there are several more distinct segments that banks can incorporate using lifestyle segmentation variables integrated with a next most likely product model building process.

For example, “Niche Segmentation,” which groups consumers into 25 different segments based on similar life stages and interests, adds value when used with predictive models. We also have seen a great deal of success with our banks using the Nielsen P$ycle segmentation. This is a 58-cluster segmentation built specifically for the financial industry to provide understanding of customer financial behavior. Some firms integrate these variables in propensity modeling.

Another segmentation technique some banks and credit unions us is Nielsen’s ConneXions, which combines consumer communications behavior with technology adoption. Across any segmentation used, there should be an overarching focus on new-to-bank customers with aggressive and deliberate onboarding cross-sell programs as well as the lost/attriting customer segment for win-back strategies.

Making Cross-Selling Part of Your Culture

A successful cross-sell program has to be part of the corporate culture with aggressive share of wallet and relationship growth goals that are communicated, tracked and accountable across the organization.  Cross-sell absolutely has to be a holistic approach across all channels – including online – as well as part of the front line CRM platform to truly reach peak effectiveness. It is always advisable to combine response models (who is most likely to respond) with targeted creative messaging and offers developed for specific customer segments (what they are most likely to respond to).

There also needs to be more refined strategies and targeted execution of cross-selling programs. Banks and credit unions must develop and execute holistic strategies to ensure communications are consistent across multiple channels using targeted, but still direct, methodologies such as variable-data printing, IP-driven online advertising that pairs with print, and coordinated email outreach.

From Cross-Selling to Advising

While segmentation is an invaluable tool in improving cross-sell efforts, banking organizations are also faced with an additional challenge of moving from a ‘selling’ to an ‘advising’ mentality, ensuring that offers and communication are created with a ‘customer-first’ execution. For example, if a traditional retail bank is now cross-selling financial planning, they have to build an advisory strategy that reinforces the organization as a trusted provider of choice for financial services.

It doesn’t necessarily follow “if you offer it, they will come” – banks must show a strong value proposition if they hope to be successful cross-selling into new competitive arenas.  Many cross-sell initiatives in the past weren’t effective because 1) the ‘depth of knowledge’  may not be as strong as the competition or, 2) the offers were in the best interest of the bank as opposed to the customer.

Repositioning the sales process (and even the product line) to be beneficial to the consumer first is a HUGE undertaking, but success in expanding relationships is dependent on a commitment to making this cultural change across their entire organization. Repositioning the sales process is not just a marketing department initiative, but must be a strategic initiative across the entire organization.

Once a new outlook on cross-selling is established, it is imperative to equip your sales force for effective cross-selling. An effective tactic is to incorporate customer scoring (product propensity scoring) into the organization’s CRM platform so all customer facing personnel can have effective needs-based dialogs with prospects and customers.

From ‘Share of Wallet’ to ‘Top of Wallet’

It is very difficult for any one organization to gain a vast share of wallet (including investment services, retirement services, insurance, etc.) with the level of competition in the marketplace. This is made even more difficult if an organization has not effectively achieved a strong level of primary service engagement with the customer.

Before trying to gain share of wallet, organizations must adjust and modify cross-sell goals and focus more on core bank products and engagement services (direct deposit, online banking, mobile banking, remote deposit capture, overdraft protection, etc.). With effective onboarding and early relationship engagement product cross-selling, the potential of becoming ‘top of wallet’ will be a logical first step to gaining the sought after ‘share of wallet’ advantage.

According to the Deloitte survey, only 19% of bank customers have 3 or more products in addition to their checking account with their primary institution. Investments, insurance and other high impact products are more likely to be elsewhere. Or, said another way, only one out of five customers have their “full wallet share” with their primary bank. Until the majority of customers have checking, savings and at least two or three additional engagement services with your organization, the focus should be on core services. Only then will the consumer be open to an expanded relationship.

Upgrading Your Cross-Sell Process

Start with the following steps to upgrade your cross-sell program:

  • Establish realistic but aggressive goals for: share of wallet, top of wallet, products per household, household profitability and retention. Establish key metrics and benchmarks
  • Develop customer segmentations that leverage demographics/attitudinal data, transactional/product ownership data, life stage, and lifecycle (new, mature, attriting, and lost)
  • Build holistic product offerings around the customer segmentation
  • Build a strong value proposition for all products in the cross-sell program
  • Integrate both response modeling (who is most likely to respond) and customer segmentation driven creative (what are they most likely to respond to)
  • Utilize consistent, coordinated cross-sell campaigns across all channels including online and through your CRM at branches and call centers
  • Engage customers before selling customers
  • Train/educate all staff in these goals, strategies, and initiatives

Cross-sell is at the core of building lasting relationships, and growing household profitability. An approach that lacks customer insight and commitment results in customer churn. A cross-selling program that finds an analytic-driven cross-sell initiative at the forefront of customer retention efforts will breed customer lifetime value, brand loyalty and retention for years to come.

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