While the big banks have the luxury (and finances) to consider elaborate, technology-driven schemes to entice high-end customers, few smaller financial institutions like credit unions and community banks are as fortunate.
Compounding this issue is the customer base of smaller, community-oriented financial institutions. Referred to as “mass-market customers” these bank users are traditionally lower income, and less technologically inclined. This can make it difficult for credit unions and community banks to sell the latest products available, and in turn remain profitable.
Luckily, there are solutions to these issues, that allow smaller financial institutions to best serve their base and turn a profit. One of these is to increase cross-selling. In essence, cross-selling means to simply sell an additional product to an existing customer. Couldn’t be easier — right?
But when your customers aren’t terribly wealthy, or easily enticed by the latest digital banking solution, it can be tricky to have them buy additional products. In fact, while the mass market customers that frequent small financial institutions do most of their chequing and savings there, they turn elsewhere for different products at bigger banks.
To compete, more modest financial institutions will have to improve their cross-selling game. Here’s how:
Increase Customer Awareness About Products Beyond Daily Banking
Like all customer segments, mass market customers require mortgages, loans and other products. Their business makes up a large percentage of the overall banking industry and represents a promising opportunity for additional business.
Smaller financial institutions have to employ strategies to inform their customers about available products outside their standard accounts. One way to do this is by using customer transactions to identify potential needs and offering a solution for them. Banks can see customers that are paying for a mobile phone, and if they’re not on mobile banking it makes sense to offer them that solution.
By remaining aware of your customers transactions, banks have unique insight into products that might interest them. Now imagine an AI that can predict it instantly and automatically offer them — it’s not far fetched.
2. Equip Every Bank Employee With the Tools To Cross-Sell
Nowadays, customers interact with very few people in the bank environment. It might be a quick trip to the ATM, or a chat with the first free teller. There might seem to be few ways to capture the interest of these customers. But what if everyone at the bank was equipped to showcase new products to existing customers?
If the tellers, the bank managers and yes — the sales people — are all trained on cross-selling and aware of the latest products, they can quickly and adeptly inform customers about products that can augment their banking experience.
We’ve written before about the loyalty of existing bank customers. But in his blog, Don noted he quickly left for another institution when his bank wasn’t equipped to meet his needs. Having trained employees who can react quickly to customer needs will have a positive impact on cross-selling and thus, profit.
3. Deepen Customer Relationships With Digital Transformation
Smaller financial institutions and community banks are masters of face-to-face interactions in ways the big banks simply can’t be. There’s a familiarity that community banking facilitates, and it helps establish long term relationships.
But behind the scenes, it can be difficult to keep up with the tech big financial institutions are able to pump out. This can hurt the revenue of smaller banks and credit unions, preventing them from serving their community in the long run.
That’s where FinTech comes in. While many large companies opt to develop in house, companies like Zafin create third party software without the enormous costs associated with software creation, allowing smaller organizations to access it more affordably.
With FinTech solutions, you can assess the needs of customers more accurately, and automate product offering based on the info. You can also bundle and price fees according to the individual customer, personalizing an experience and deepening loyalty. It’s not just a great way to facilitate cross-selling — it’s a great way to turn a customer into a brand evangelist.
Looking to get started? Get in touch with us today and find out how Zafin can empower your institution to start cross-selling.
Zafin (@zafin) is a leading financial technology provider that enables banks to form richer, more personalized client relationships. Built from the ground up for financial services, its platform empowers banks to enhance revenue and operational efficiency. Founded in 2002, Zafin sits among North America’s top FinTech companies, and is trusted by retail and corporate units at some of the largest banks worldwide. Headquartered in Toronto with global offices, Zafin has a proven track record with a 100 percent client retention rate as validation.
Cam is the Product Marketing Strategist at Zafin. With a background in journalism and a passion for blogging, Cam strives to tell compelling digital stories. At Zafin he will share the latest trends and news in the FinTech world, and share Zafin’s role as leader in the industry. Follow him on Twitter @CamSmoth