Practical Strategies to Address the Top 10 Issues Facing Banks Today
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Transcript of Practical Strategies to Address the Top 10 Issues Facing Banks Today
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Practical Strategies to Address the 10 Top Issues
Facing Banks Today
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10 Ten Critical Issues Banks Face
Practical Strategies for Dealing with these Issues
Ideas to Shift from a Transactional to a Customer-Focused Culture
5 Qualities of a Customer-Centered Culture
4 Questions to Gauge Where Your Organization is Today
Tips to Move from Transactional to Relationship-Based Selling
What You’ll Discover
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• Increased consumer protection
• Tools for financial crisis
• Tighter credit rating agencies
#10: Increased and Changing Regulations
Grant Thorton Bank Executive Survey
Smaller banks not providing products that increase compliance burden.
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To “offset” compliance, become a partner and
focus on customer needs.
Integrity Solution
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• Interest rates remain low
• Shrinking retail footprint
• Demise of free checking
#9: Reduced Income and Profitability
In 5 years, free checking has gone from 76 % to 39 %.
2013 Deloitte Study: Retail Bank Pricing
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To increase income, build cross-selling skills and a
positive attitude about selling.
Integrity Solution
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• Average bank has 2.1 out of 7
• Goal is 4 or more
Key Challenges
• Creating and monitoring effective cross-selling programs
• Lack of service and sales skills
• Siloed teams
#8 Share of Wallet
BAI Banking Strategies: Strategies for Cross selling Forrester Cross Selling
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How many products on average does YOUR bank have per customer? 1 - 2 per customer
3 - 4 per customer
5+
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To increase wallet share:• Develop listening and
questioning skills to spot additional opportunities.
• Encourage collaboration
Integrity Solution
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Work together to spot opportunities
First National Bank of Elk River uses Integrity Selling® when recruiting new business relationships.
“We don’t try to talk prospects into joining our bank; rather we sit down with them and find out what their company and personal goals are. We are able to spot strong potential clients and spend time with them.”
Chad Vitzthum, SVPFirst National Bank of Elk River
“We decided to include back office team members as well as front line team members… this has actually bridged that gap and brought us together.”
Belinda OxfordCertified Trainer
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Over 75% don’t consider banks for their advisory, investment, or brokerage activities
#7 Opportunities
Challenges
• “Vanilla products and services”
• Ignoring the mass affluent
• Small businesses not satisfied
Commercial customers have increased their use of credit lines from 30 – 33 % …
Banks building strong relationships have great potential for increased profitability.
KPMGMcKinsey & Co. Private Banking Survey
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To capture opportunities …adapt your brand image and
develop advisory expertise.
Integrity Solution
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• No difference between X and Y
• Indifferent to a brand
• Overlook complex products
• Expect convenience and transaction technology
#6: Commoditization
As standardized tools give only standardized experiences,
brand differentiation is further limited. Accenture: Banking 2016Deloitte: Brand Commoditization in Retail Banking
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To avoid commoditization, make your people
your differentiator.
Integrity Solution
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What makes YOUR bank different? Your People?
Your Products?
The Overall Experience?
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Your Bankas one of Integrity
Your Product or Serviceas creating value
Yourselfas a person of Integrity
Three Things to Validate
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The growing influence of technology on banking functions threatens to commoditize
even the most personalized aspect of traditional models
— the customer experience.
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#5: Customer Service
TheFacts:
• 3 out of 4 executives: “Customer experience has improved…”
• 2 out of 3 consumers: “No change.”
• 1 in 3: “I have a problem.”
Banks that respond to upset customers are 2.3 times more likely to retain those customers
than if they did nothing.
KPMG Community Banking Outlook
PWC US Retail Banking Trends: Experience Radar 2013
PeopleMetrics 2013 Most Engaging Customer Experience Study
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To improve the customer experience, adapt a common
definition and values for service and sales.
Integrity Solution
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#4 Loyalty / Churn
More Facts…
• 2 in 5 switched after bad experience.
• More than 50% opened or closed accounts/services in past 12 months.
• 40% have similar plans in next year.
A most common reason for opening or closing accounts: “the experience with my financial service providers.”
Ernst & Young Global Consumer Banking Survey Bain Report 2012: Customer Loyalty in Retail Banking
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To minimize churn, focus on rapport building skills to grow
and maintain customer relationships.
Integrity Solution
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Poor service/problem resolution
High fees
Branches not convenient
Products didn’t suit needs
Poor rates on credits/deposits
Reasons for Switching
Booz & co. Small Business Banking Customers An Attractive Segment for Organic Growth
43%
38%22%
20%
15%
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• 8 in 10 Americans blame big banks
• 5 years later, 66% are still angry
• More than half don’t believe their bank has their best interest at heart
• 42% feel taken advantage of
• Nearly 50% think they should bank locally
#3 Trust
COMPLETE TRUST:#1 “financial stability”
#2 “the way I’m treated…”
Kasasa Harris Poll: Consumer Banking Insights Study2013 Deloitte Study: Retail Bank PricingErnst & Young Global Consumer Banking Survey
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To build or restore trust…connect with customers.
Integrity Solution
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Looking at matters from a glass-half-full perspective, the financial services industry has great potential.
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#2: Human Touch
The Realities…
• Less opportunity
• Technology doesn’t build relationships
• Branch visits are for problem resolution
TheFacts…
• Web now #1 channel for
banking
• 61% of internet users
bank online
• 35% of smart phone owners
use mobile banking
2013 Pew ResearchPWC Retail Banking 2020PWC US Retail Banking Trends: Experience Radar
60% of great experiences…
involve some form of human touch.
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To ensure the human touch, discover what you can
about relating to different Behavior Styles.
Integrity Solution
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#1: Customer-Centric Culture
• 61% consider a customer-centric business model to be very important
• Less than 20% are prepared
61%
TRANSACTION MINDSET
CUSTOMERMINDSETGAP
A successful customer experience requires more than transactional skills and product knowledge.
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To build a customer-focused culture, shift from transaction
to customer-focused beliefs, behaviors, and skills.
Integrity Solution
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So, is GOOD
SERVICE the ANSWER?
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PROVEN: Well-executed service programs DO significantly impact on revenue and bank earnings.
So why do so many banks believe they provide excellent customer service --
but still have low RESULTS?
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The GAP:
Many customer service processes are not fully integrated into the culture.
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5 Qualities of a Customer-Centric Culture
Teams work together to deliver a consistent, memorable customer experience.
Individuals go beyond the transactional experience to build high value customer relationships.
Everyone speaks a common language and exhibits common ethics and values.
Frontline has a positive view of selling and sees themselves as part of the sales process.
All employees believe selling is great for the customer, themselves, and the bank.
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2
3
4
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Do you have a customer-centric culture?
To What Degree do Your PEOPLE…
• Understand the components of a memorable customer experience?
• Use a COMMON LANGUAGE and FRAMEWORK for service and sales?
• Take a PROACTIVE approach to problem resolution?
• Develop TRUST with customers and ASK QUESTIONS to identify how products meet needs or solve problems?
To What Degree do Your LEADERS…
• Foster a culture of POSITIVE, CUSTOMER-FOCUSED SELLING rather than a transactional mindset?
• Model and coach customer-centric BELIEFS AND BEHAVIORS?
• Provide service and sales training?
• PROACTIVELY reward customer-focused behaviors and performance?
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Congruence Model
View of
Selling
Commitment to
Activities
View of
Abilities
BeliefIn
ProductValues
Congruence
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A person’s
attitudes, beliefs and
values have more to
do with the level of success they achieve than knowledge or skills!
Success Factors
Knowledge & Technical Skills
Attitudes, Values, Beliefs, Motives
and Achievement Drive
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Congruence Makes the Difference
“Most of the people who’ve gone through our Integrity program said, “Oh, that’s what selling is? Really? It’s just me serving my customer, sharing my knowledge and experience, helping them get the right product and service, or solve their problems? Hey, I can do that!” I’ve really seen a lot of success with that. And giving them a system that works, that’s comfortable, that makes sense -- really helps them succeed.”
View of Abilities scores up 15%
Commitment to Activities up 25%
Goal Clarity up 27%
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Values and Ethics
Selling is a mutual exchange of value.
Selling isn’t something you do to people; it’s something you do for and with them.
Develop trust and rapport before any selling activity begins.
Selling pressure is never exerted by a sales professional. It’s exerted by customers when they recognize the value of your products and services.
Selling techniques give way to values-driven principles.
Values and Ethics
From Integrity Selling®
1
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Values and Ethics
Truth, respect and honesty provide the basis for long-term selling success.
Ethics and values contribute more to sales success than techniques or strategies.
Understanding wants or needs must always precede any discussion about product.
Negotiation is never manipulation. It’s a strategy to work through concerns – when customers want to work through them.
Closing is a victory for the customer, the sales professional and the organization.
6
7
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9
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From Integrity Selling®
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Shared Values Increase Success
President & Chief Operating Officer Rob Stephenson credits Integrity for helping First Dakota
“Integrity and values are very important to First Dakota management…Employees agree that living their values increases the confidence of customers.
The thought that we’re truly wanting to do the right thing for the customer makes it easy for us to sell products. It’s not selling the product of the month -- it’s selling what the customer needs at this moment in time.”
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Strategy Summary
1. Become a PARTNER and focus on customer needs.
2. Build cross-selling skills and a POSITIVE ATTITUDE ABOUT SELLING.
3. Develop listening and questioning skills to spot additional opportunities, and encourage COLLABORATION across teams.
4. Adapt your brand image and develop ADVISORY expertise.
5. Make your PEOPLE your differentiator.
6. Adapt a COMMON DEFINITION and VALUES for service and sales.
7. Focus on rapport building skills to grow and maintain CUSTOMER RELATIONSHIPS.
8. CONNECT with customers right from the start and throughout.
9. Discover what you can about relating to different Behavior Styles.
10. Shift from transaction to CUSTOMER-FOCUSED beliefs, behaviors, and skills.
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Want to Learn More?
• View recording (video & audio)
• Request copy of slides, bibliography and two free white papers
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About Integrity Solutions
• Training industry leader for 45 years
• Trained over 3,000,000 people from
130+ countries
• 200+ leading financial institutions as clients
• Tailored solutions that improve service, sales, and
coaching cultures for banks, credit unions, insurance and
other financial organizations
• Proven behavior change process that gets results
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Contact Integrity Solutions at 615.385.2246 or visit us at
www.integritysolutions.com
Thank you
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Appendix: Sources
2013 Deloitte Study: Retail Bank Pricing
2013 Pew Research
Bain Report 2012: Customer Loyalty in Retail Banking
Ernst & Young Global Consumer Banking Survey
Kasasa Harris Poll: Consumer Banking Insights Study
PWC Retail Banking 2020
PWC US Retail Banking Trends: Experience Radar