Financial Marketing and Cross Selling Blog
Community Banker reported on how one of Truebridge’s customers is using Cross Sell Advantage to "win over its customers."
Community Banker, a leader in bringing cutting edge news to America’s community banks, reported on how one of Truebridge’s customers is using Cross Sell Advantage to “win over its customers.” Community Banker focuses on four key issues-mortgages, technology, management, and wealth. Plus, they bring subscribers in-depth compliance and legal information.
When it came to broadening customer relationships, community banks were supposed to have an ace up their sleeve.
Their loyal customers made plenty of regular contact with bank personnel at the teller window, where they could be steered to loan officers, investment sales reps or the trust department.
But something happened on the way to cross-selling utopia. As ATMs, debit cards and phone and Internet banking came of age, foot traffic at banks dwindled. At the same time, brokerages and other non-banks started acting like banks, offering products like money market and checking accounts.
These days, banks have to fight just to hold on to customers.
“That becomes more of a challenge every single day,” said Denise Renaghan, president and chief operating officer of Bay State Federal Bank, in Brookline, Mass. “We need a method to capture a new audience and keep our customer base.”
Bay State, a $544 million-asset institution with six branches and 100 employees, thinks it may have found a way to do both. In June, the bank rolled out a new feature on its Web site, the “Moneyfitness Center.” Customers who click through to the center find, essentially, a mini university of financial planning with a surprisingly personal touch.
Customers can click on links to learn about specific areas, from IRAs to small business loans to information about Medicare. Or they can start from square one with a personalized tool that tells them which financial planning questions they should be asking.
Some of the questions include: “How much life insurance do I need?” and “When should I refinance my mortgage?” Once customers have zeroed in on their needs and learned the basics of the products that can fill them, they can click on buttons for information about products that Bay State offers.
When they click on “Home Equity,” for instance, up pops a form to submit questions. It includes a photo of loan officer Coleman Carden, along with his contact information and a personal statement in which he invites customers to get in touch. The idea is not only to extend a personal feeling to the Internet, but also to have potential customers recognize Carden and his counterparts when they walk into a branch.
“We all have a more comfortable feeling knowing what that person is going to look like and sound like,” said Renaghan. “And this lets some of the issues sink in before you sit down face to face.”
The site also includes an audio feature in which actors lend their photos and voices to various financial planning scenarios. In one, 63-year-old “Steve Colletti” and his wife, who survived a recent brush with cancer, discuss whether he can take early retirement so that the couple can travel. Steve later talks to a financial planner.
At the conclusion of the vignettes, listeners are prompted to click on links to learn about issues like retirement distributions, or to contact a Bay State specialist.
“The way people approach their finances is different today,” said Renaghan. “It’s important to us to try to stay up with the change in financial habits.”
That’s why the bank’s executives were all ears when Truebridge Financial Marketing, of Hingham, Mass., approached them to pitch their Cross Sell Advantage product.
Truebridge is headed by A. Stewart Rose, a financial marketing consultant who learned about the challenge of cross marketing firsthand during a stint at Citicorp in the late 1980s.
Bankers didn’t want to share their relationships. Training and referral tracking were in their infancy. And on top of that, customers weren’t used to doing business in more than one area of the bank.
“I started to realize there was a really big challenge,” he said.
Rose came to realize that customers had to learn to see banks differently. To achieve that, banks had to leave abstract pitches behind and use a marketing approach in which customers would recognize themselves and their own challenges.
“It helps people see their needs, which might not be apparent to them,” said Rose. “And it starts a dialogue between the customer and the bank.”
So far, two institutions aside from Bay State have licensed the product—Black River Country Bank, in Black River Falls, Wis., and Emery Federal Credit Union, in Cincinnati. In each case it’s branded Moneyfitness, but it carries each institution’s name as well.
The product’s effectiveness is hard to gauge since it has only been around for a matter of weeks at this point. But Bay State says the early results are promising.
The site is consistently getting 1,000 hits a month, and people already seem to be using it for financial planning. For instance, when the site went live people went right to its retirement area—which makes sense because lots of workers are concerned about corporate troubles affecting their retirement plans.
the school year drawing near, people turned to the site’s section on tuition assistance and planning. And investors’ flight to safety explains a consistent interest in the certificate of deposit area.
“We can tell what’s on our customers’ minds,” said Renaghan.
The bank wants to drive more traffic to Moneyfitness. So it’s including a “Moneyfitness Card” in new account kits. It recently promoted the service at a breakfast for 75 new teachers in the area. Cross selling is especially important for Bay State because it recently went public. Now the bank has to focus on increasing revenues as much as possible to ensure shareholder value.
“We want the bank to be seen as the customer or prospect’s primary financial service provider,” said Anthony Caruso, senior vice president in charge of retail banking. “We want people to think of Bay State Federal Bank when they think of everything from a stock trade to a mortgage loan.
“And we have an opportunity to get those people before someone else does if we can show them that we offer full service.”
Of course, Bay State does not expect to do that simply by souping up its Web site.
The process of going public has included everything from adopting a new logo to creating an aggressive new cross-selling plan to training its staff in cross selling. The bank put everyone from part-time tellers to loan officers through three or four sessions of training from an outside consultant.
On top of that, employees are encouraged to continue their education by exploring the Moneyfitness site. Those who pass are entered into prize drawings. “It’s one thing to say ‘sell additional services to these customers,’ and another to actually have them do it,” said Caruso. “So we looked for tools and training.”
And one of the big tools is Moneyfitness. It was the potential for more efficiency that sold Caruso on the product.
Bay State does regular cross-selling promotions, but the advantage of Moneyfitness is that the sales process is targeted. In a sense, it enables customers to select themselves.
“You can have a teller talking to a customer about a home equity line,” said Caruso. “But if the customer doesn’t own a home, it’s a waste of time.”
On the other hand, a homeowner can find his way to the home equity information on the Moneyfitness site, then click back to the bank site to get information about rates, and then go back and contact a bank representative.
Not only has the customer zeroed in on a product, he or she is already educated about the basics, which saves the loan officer time. “The easiest cross sell is the most efficient,” said Caruso.
So how, aside from Web site hits, will Bay State know whether its Moneyfitness experiment has been a success?
For Renaghan, it will come down to whether the bank sees increased sales of non-deposit products and retirement products like IRAs and Keoghs.
“That’s where people are focusing today,” she said. “If we see that increase, we’ll know that this product was the turning point in educating our customers so that they chose to make those investments with us.
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