Five facts every client wishes his banker knew … and why they’ll increase your business

Five facts every client wishes his banker knew …

and why they’ll increase your business

Bob Penny, Ph.D.President, The Penny Group, Inc.

April 17, 2013

Psychology

• Therapy

Psychology

• Therapy

• How to improve healthy, normal WORK relationships (corporate psychology)

Psychology

• Therapy

• How to improve healthy, normal WORK relationships (corporate psychology)

• Beliefs & assumptions ---> behavior

Bankers:“Less risk is better than more risk”“The world is rational and logical”

Business owners and CFOs view the world differently than do their bankers

The single most effective step you can take to increase your business …

IS TO UNDERSTAND EACH CLIENT’S PERCEPTIONS

If you correctly understand and respond to a client’s assumptions and perceptions,

You CAN predict which clients will buy from you.

You CAN predict which clients will KEEP doing business with you and which will REFER their

colleagues and friends to you.

Statements any business owner would nod his head “yes” over

Specific examples of how these facts can help you expand business

5 facts …

5 facts every client WISHES his banker knew

5 facts every client wishes his banker knew

1. My business is the sum of my dreams, my hopes, and my worth as a person. Please don’t treat me like a spreadsheet.

The most effective high school teachers…

• Engage the student

• Make the student feel good about him or herself

• Offer a better alternative than typical negatives/punishments

• Effectively deter the allure of dropping-out

• Understand the teenager’s perspective/point of view

The same is true of business owners/CFOs…

• Personally invested and “vulnerable”

• Want to feel understood

• Need you first to understand, then help.

Marshall McLuhan

The Medium is the Message

Marshall McLuhan

The Medium is the Message

Why would an individual who could get a bank loan…

Go instead to a high interest rate “loan company?”

“Like asking my PARENTS for money!”

I know that you need to “evaluate” me …

I understand I need to provide you a strong business case

I know you want to see a profit … and I want to even more!

To truly understand my business, you need to understand ME

I understand being evaluated

I understand being evaluatedBut I don’t want to feel … JUDGED

WHAT YOU NEED TO DO:

Take time to understand me, my business and what they mean to me.

Imagine the person sitting across from you is your son or daughter(regardless of their age).

Don’t judge me … use your evaluation skills to help me.

2. Your thoughts about me, your advice and your willingness to tell me the truth are more valuable than any loan.

When The Penny Group works with bankers, each chooses 20 key clients / prospects.

We then provide the banker with an outline of the issues that individual perceives as most important in creating an ideal

banking relationship

Experienced Commercial Banker (15+ years)

Feedback from the CEO

She’d worked with him for 10-plus years

Her largest client (two-thirds of last year’s revenue)

One issue to focus on in the coming year:

One issue to focus on in the coming year: “Being straightforward and honest with me,

even when it’s difficult to do so”

“You predicted I would hear something unexpected. I did.”

“Tell me more”

His definition of “being straightforward and candid”

was from HIS perspective … not hers

Actions for YOU

• PROACTIVE contact is ALWAYS better than being responsive

Actions for YOU

• Insights do not have to be dramatic

Actions for YOU

• Insights do not have to be dramatic

• I can abide by any decision … just tell me the TRUTH

3. I want to buy more than a product. Give me a great experience.

Daniel Pink

To Sell is Human

Daniel Pink

To Sell is Human

Material purchases vs. Experiential purchases

Most bankers

perceive the process of borrowing as

a material purchase …

Most bankers

perceive the process of borrowing as

a material purchase …

the ultimate commodity

100% experiential

(the ultimate commodity)

“Why Satisfied Customers Defect”

Harvard Business Review

Dissatisfied Satisfied Very Satisfied

80%20%

80%“okay … for now”

80%Fewer than 1 in 5 will recommend you

“Early Years of Marriage Project”

Terry Orbach

University of Michigan psychologist

Terry Orbach

University of Michigan psychologist

What predicts whether a marriage will survive?

(guesses????)

It IS about the relationship experience …

but it’s NOT the dream vacation /house /new car

It’s NOT the dream vacation /house /new car

“my spouse often makes me feel cared for and special”

It’s NOT the dream vacation /house /new car

“my spouse often makes me feel cared for and special”

75% of HAPPY couples say that … just 40% of UNHAPPY couples

“Doing or saying small things frequently

to make your partner feel special, cared for, and loved

is very predictive of

staying together, being happy, and preventing divorce.

These ‘positive affirmations’ can be

as simple as tucking a nice note in a spouse’s wallet,

or giving a shoulder rub after a long day at work”

Actions for YOU

Clients WANT to know you’re thinking about them.

Actions for YOU

Clients WANT to know you’re thinking about them.

YOU initiating contact is the single best way to create the perception

“YOU CARE ABOUT ME.”

4. To create loyalty, you must become memorable.

Think about a provider you currently use…

Mechanic, home repair guy, insurance rep, dry cleaner, etc.

Think about a provider you currently use…

Mechanic, home repair guy, insurance rep, dry cleaner, etc.

“I’m not just satisfied, I’m delighted!”

“I would recommend them unconditionally to others.”

Doing what you’re expected to do is today simply that:

What you’re expected to do.

Doing what you’re expected to do is today simply that:

What you’re expected to do.

The only way you can ever get to “very satisfied”

is to do something EXTRAODINARY.

So what is … EXTRAORDINARY?

Ask a client directly and you’re likely to get:

“You’re fine! You’re doing everything I was looking for!”

“Well, …you could lower my interest rate!”

Asking your spouse what he/she wants for their birthday

Surprising the person with the same gift

Asking your spouse what he/she wants for their birthday

Surprising the person with the same gift

Which one is memorable? Why?

The same is true for a banking relationship

“Memorable” ≠ complex or major

“I thought you’d be interested in this” with a WSJ article

Actions for YOU

Ask yourself for each relationship …

Actions for YOU

Ask yourself for each relationship …

What can I do to become MEMORABLE with this client?

5. When you don’t know what to say, say “Tell me more.”

We all operate with beliefs and assumptions

and…

We are generally blind to the fact that others do not share them

and…

We are generally blind to the fact that others do not share them

If that’s true in long-term relationships like marriage

It’s definitely true in the relationship between banker and client

How do you find out

if your beliefs and assumptions

are DIFERENT from your client’s?

Phrases like

“What makes you think XXX?”

Phrases like

“Why do you believe YYY is true?”

Phrases like

“Why do you believe YYY is true?”

Serve only to SHUT DOWN communication

The ONLY way to understand someone else’s

beliefs and assumptions …

The ONLY way to understand someone else’s

beliefs and assumptions …

is not to question them …

but to listen to them

The Penny Group

Rather than asking for the beliefs/assumptions, we “uncover” them

The Penny Group

5-minute questionnaire

The Penny Group

5-minute questionnaire

Forces a client to make decisions quickly based upon his/her beliefs and assumptions

One of the four questions:

“Which THREE of these 21 behaviors are most important to you?”

“Involving others at an appropriate time”

What does that mean to you – as a banker?

• Involving other internal partners

• Involving other loan officers, credit approvers, specialists, etc.

What does that mean to clients?

• Involving my spouse, or significant others

• Attorneys, accountants, others important in my business

HOW DO YOU COMBAT THAT?

“Tell me more”

Simple, open-ended, non-evaluative

“Tell me more”

Simple, open-ended, non-evaluative

“I’m listening!”

What did you expect from today’s presentation?

Clients probably want to know …

“what’s happening with the economy” or …

“the ideal time to borrow.”

“Sure, I’d welcome knowing that …”

but NO client suggested those as what they wish their banker knew

Five facts every client wishes his banker knew …

and why they’ll increase your business

Bob Penny, Ph.D.President, The Penny Group, Inc.

April 17, 2013

Five facts every client wishes his banker knew … and why they’ll increase your business

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