These are tough times for selling anything, particularly financial services. Consumers are knuckling down, going for the bare minimums and ignoring even the most sophisticated sales pitches. What to do if you're selling financial services? Cross sell. Old news? Not really.
While financial institutions are just getting by with an unremarkable 2.10 cross-sell ratio to new customers (Forrester Research, October 2011), Wells Fargo’s ratio has managed twice that. How do they do it?
Tom O’Rourke, Director of Loyalty & Relationship Marketing at Dave Bocks & Associates Marketing, reveals his strategy for Wells Fargo’s Checking Packages. He notes that customers don’t relish talking to bankers, which means they must be engaged in the sales process with product “bundles” (checking, plus three additional products or services). These must be shown to deliver incremental, monetized value.
Wells Fargo’s Q4 2011 earnings report revealed that 86% of all new customers bought a package of products. Compare that to no more than 10%-15% of new customers purchasing four or more products from your average bank. Imagine what a leap like that can do to your sales and profits.
Getting customers to buy four or more products is an attainable goal. New business managers need only draw on four or five database reports—including product penetration, onboarding cross-sell, customer retention and profitability. An analysis of these reports should reveal the content of your package and how to effectively “sell” the consumer value proposition. Once this is done, you need to provide ample sales support: merchandising, point-of-sale, lapel stickers, and other collateral to draw customers out of their complacency. Customers need to quickly understand and appreciate what the package or bundle can do for them.
O’Rourke notes that once you profile customers and understand their needs, creating a package that fits those needs should be fairly straightforward. With this in mind, your customer contact staff should readily be able to embrace and the bundle strategy and appreciate its value. At this point, you must set up clearly defined, measurable goals. O’Rourke suggests you start by taking the percentage of new customers acquiring 4+ products in their first 12 months, and double it.
Cross selling can be key to your survival. It’s something every bank and financial institution is thinking about. A 2012 Bank & Credit Union Marketing Survey that included 84 banks, 30 community banks and 104 credit unions revealed their marketing priorities over the next 12-24 months. Number one on the list was cross selling and establishing deeper relationships with their customers. When asked which financial products and services their bank/credit union would promote most heavily in the next 12-24 months, home loans, auto loans and credit cards topped the list.
So dig out those database reports. Pore over them. Discover what your customers want and need when it comes to a package of financial products. Then market that package as aggressively as you can.
Photo courtesy of MorgueFile.com
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