The past decades and even centuries have witnessed much banking innovation. Consider pneumatic capsule transportation (1799), the credit card (1950), and the ATM (1967).
Those innovations were external—easily visible to everyone. But there is also a history of innovation that’s internal to the industry, with bellwether changes to banking sales management and its increasing focus on the customer.
Over time, we went from standard bankers to “personal bankers.” For the affluent, there were
Personal bankers could open deposit accounts, but then universal bankers started to make personal loans and mortgages.
The last two times we connected, we’ve been talking about the need to improve the cross-sales within your bank to create a better sales experience for your people. And to make sure that you capture the entire customer relationship by creating a transformation of the process that attracts the customers to you.
Good Intentions Aren’t Getting the Job Done
Let’s say it: Good intentions aren’t getting the job done. If it was true that they were, we would have solved this cross-sales thing a very long time ago. It’s imperative for the customer relationship in your bank to make sure that you’re accomplishing the outcomes of the entire relationship being captured––especially as it applies to your top 100 most profitable customers,
The last time we met, I told you we’d be coming back this time to discuss: how do you boost those cross-sales and how to do it by having a cultural transformation within your organization.
Because that change in your culture and improvement in your bank’s culture is key to transforming results by making sure that your customer feels heard and moved along.
Outdated Sales Systems & A Better, Proven Process
Most people have the wrong system of sales. We’ve been applying the same system for many, many years with our banks.
If you want to improve the performance of your bank, you’re probably going to need to improve your cross-sales. When your people are meeting with your customers and they’re accomplishing six, seven, eight, maybe nine, or sometimes ten cross-sales on average versus the 2.2 which is typical in the industry, you don’t need nearly as many people and you can pay everyone that you have a whole lot more. Plus it leaves a lot more profit for you.
The Challenge of Cross-Sales
Getting cross-sales right is something that’s been very hard for banks for 30 years.
And hear your customers say, “I Don’t Want To Work With Any Bank But You.”
If you don’t care about bank premium pricing, you can stop listening right now.
This is for bank executives who want to figure out how to command premium pricing despite the too-common assumption that banking is a commodity. Therefore, they cannot command premium pricing—or, at best, maybe 25 basis points more on the loan side.
Here’s The Problem
Any bank that can only command 25 basis points of premium pricing will probably not have its name on the front door five years from now.
If your top 100 customers do account for 50 to 140 percent of your profits, like they do for most every bank with under $2 billion in assets, you have to ask yourself: Do you really know how to identify your next top 100 potential customers?
If you don’t care about premium pricing, you can stop listening right now. This is for bank executives who want to figure out how to command premium pricing despite the too-common assumption that banking is a commodity. Therefore, they cannot command premium pricing—or, at best, maybe 25 basis points more on the loan side.
Terry Slattery, the Legend of IBM, the person who brought in more business for IBM than anyone has before or since, has been a dear friend and partner of mine for almost two decades now, helping our banks figure out how to grow their revenue streams.
Terry recently said he has never seen a harder sales environment in his career across every industry.
How much do you invest in your marketing budget every year? Now divide that amount by the number of calls or inquiries it generates.
For most banks, the marketing budget is driven by shiny new ideas from conferences that marketing people attend or based on what was done the year before.