Creating an unpaid salesforce in your community bank.
Community banks and bankers that fail to understand the value of Advocacy are leaving one of their main advantages on the table. One of the popular terms in the community banking world is “Relationship Banking”. The point of relationship banking is to have the customer’s entire banking relationship and for that customer to refer other similar customers to your bank. Most community banks want advocates and referrals but oddly enough it’s rare to actually see a bank with an effective strategy in place to develop these advocates. We break customers down into a few categories.
- Satisfied Customers – Happy with you and nothing negative to say
- Loyal Customers – Have 4 or more services with you
- References – Speak well of you when asked about your bank
- Advocates – Proactively sing your praises
The goal is to move each of these customers to the next level and eventually to the top level of Advocate. We’ve seen many banks talk about getting customer referrals, we’ve seen plenty of training on it but in the end, most of these efforts end up in the trash pile of good intentions. In our 20+ years of successfully implementing relationship-based advocate cultures, we’ve seen the roadblocks that consistently plague the typical community bank. Here are our top five…
Making false assumptions
Most bankers don’t know the customer nearly as well as they think and most don’t treat their customers as well as they think. The key word here is “think”. You need to “know”. Community bankers are notorious for thinking they deliver the best service and have the best people, but few really know. See our last blog post, The Big Lie in Community Banking. When we hear the comment, “she’s the best teller we have”. Is that an assumption and how you feel or do you really know this to be a fact? What are you basing your statement on? The level of advocacy in your community bank is a relationship score. It’s the score that confirms what your customers really think of your bank and your people. If that “best teller” doesn’t have a relationship score showing she is developing advocates, then she is certainly not the best or at the least she may just be the best of the worst. Don’t make false assumptions. Keep score and track the sales your advocates are delivering to your bank.
Asking the wrong questions
There are volumes of books and blogs giving advice on getting customer referrals. Many have some good ideas and tips. We constantly hear that you have to ask for the referral. This is true. You do need to ask. Better yet, ask when you get a thank you from the customer after helping her. But we’re talking about advocates. Those customers that are proactively telling others how remarkable your bank is. They are sending people to your community bank without being asked. They are sending them because they believe in you and your bank. You need to find out who they are. The right question to ask of any new customer is… “How did you hear about us?”. It’s simple but very few ask it. The customer may respond that he saw an ad online. However, he may tell you that a certain person told him about your bank or about you. This certain person is your advocate. Never let a sale go by without knowing if someone sent this new customer your way. The wrong questions may not necessarily be bad questions but you can never let a sale go by without asking the right question.
Taking your customers for granted
This is an epidemic in the community banking world. Most get upset if you say it, but it’s reality. When customers open a new account, the vast majority of community bankers send out an automated welcome/thank you letter. It’s similar to the ones sent out by the big banks, just not as nice and well done. Very few bankers take the time to send a handwritten thank you note to their new customers. Very few have an outbound, reason to call program focusing on the best customers. Even fewer give their best deals to their best customers. Most opt for the kumbayah singing, let’s hold hands and treat all customers the same strategy. That type of banking works best in Crazy Town, but in the real world of creating advocacy, you must have a well crafted and implemented strategy of thanking your best customers. If you continue taking them for granted, they’ll take you for granted and come to the conclusion that you’re just like any other bank, and you’ll never get a referral.
Taking names and taking life
When receiving referrals from your customers, they are giving new life to your bank and impacting the bottom-line. Many bankers are searching for that referral mother lode of the center of influence, aka, the well connected attorney or CPA. However, most community bankers treat the referral source as a one-way street. They fail to realize they are one of the greatest centers of influence and neglect to use that influence to impact their relationships and advocacy. If you are not giving life (referring) to your best business customers, then you have no right to ask for or expect their advocacy. The best community bankers have implemented a plan and track not only the referrals they receive, but also the life they give to their customers. Failure to do this will kill your attempts of advocacy.
Mismanaging the process
This is where most efforts in gaining advocacy break down. You can ask the right question, thank the right customer and give life but if there is not a disciplined approach to managing the process it will not work. Branch and department managers’ sole job is not that of the resident expert and fireman that takes care of the various flames that pop up from time to time. The manager is there to manage. When it comes to advocacy, the best managers are focused on this daily and weekly. They talk about it daily with employees in their one-on-one conversations, they track it daily and they celebrate it weekly in the team meeting. If there isn’t a process to make advocacy a priority then it never will be.
The road less traveled
Very few travel this road to advocacy. Most can’t seem to figure out the roadblocks or don’t want to deal with the status quo protectors in moving down the road. In the face of higher regulatory costs, the smart banks realize the need for an effective and well managed unpaid sales force. The road to advocacy is wide open. You just have to take it. If you need a guide, contact us. We know this road well and we can help you map a course.
