Customer Experience Solutions Benchmarks Highlighted in Banking Mid Atlantic

As the most recent banking benchmarks reflect, the most important differentiator community banks and credit unions have is their ability to deliver an excellent customer experience. When bank customers feel valued, listened to, and cared about at their bank, not even better rates can pull them away. Unfortunately, only a little more than one-third of the banking customers surveyed (over one million responses) are “highly loyal.”

This means two-thirds of banking customers throughout the northeast market are looking for a new bank. To make sure your customers aren’t the ones looking – and to attract the ones who are looking – you need to understand what your customers and prospects think of your bank.

New benchmarks are now available – request yours now.

Read the highlights about New Jersey’s and Pennsylvania’s banking benchmarks in the winter 2019 edition of Banking Mid Atlantic.

 

 

Finding Success as a Community Bank, Part 1: Challenges and Opportunities

Small community banks and credit unions face rising pressure in today’s economy to compete with large, multinational banks. This challenge to remain relevant has existed for a long time, but it has become increasingly difficult to remain so in an expanding age of globalism and corporate consolidation. Understanding how to attract new customers, while simultaneously employing a multi-generational approach, is critical to continued success and sustainability. It is possible for small banks and credit unions to compete – and even thrive – in our current market, but it requires focus, purposeful action, and a recognition of their unique strengths and advantages.

Opportunities Abound

For community banks, competing against megabanks can be a daunting challenge, but there remains enormous opportunity. In 1990, the five largest banks controlled less than 10% of all bank assets. In the last 25 years, that share has jumped to 44%. Today, approximately half of all new accounts (two-thirds of which are opened by Millennials) are established with the largest four banks (JPMorgan Chase, Wells Fargo, Bank of America, and Citibank). However, according to our own benchmark studies, an average of 13% of those megabank customers – as high as 20% in some markets – prefer a community bank.

Success Factors for Community Banks and Credit Unions

One of the most important success factors is to offer flexible, customizable services that allow your customers to choose what they want and when they want it, regardless of their age, income, schedule, or relationships. This is not only true for the younger customers but is becoming a key driver of loyalty for Gen Xers and Baby Boomers. Despite Millennials opening new accounts with larger banks, many still want the personal touch: As of June 2017, over 45% of Millennials said they preferred in-branch interaction over electronic interaction with their banks.

Keep it Personal

Most consumers are still searching for a personalized banking option, and community banks that take the important steps to capitalize on that demand will thrive. Look at examples of successful organizations from other industries that are facing the same general issue: competing with large corporations. Find out what local restaurants are doing to compete with fast-food retailers. Discover why the local auto mechanic is so successful when a chain auto-repair shop is right around the corner. The basis of any functioning business is a good relationship with its customers.

Some trends may favor large, multi-national banks, but deliberate, personalized attention can not only even the playing field, but tip the balance in favor of a community bank or credit union. With an understanding of your competitive advantage as a small, local financial institution, you can capture plenty of loyal customers that will bring success. Contact us if you would like customized benchmark reports for your region.

Next month, we’ll continue our Community Bank Success series by exploring Community Bank and Credit Union Marketing.

Is Your Community Bank Missing Opportunities with Millennials?

Emerging generations are the largest in history – even larger than the baby boomers.

  • They have access to more money than any previous generations in history.
  • They value interpersonal interactions and relationships as much as any generation in history.
  • They prize social engagement and are suspicious of large corporations to an extent never seen in any previous generation.

Despite all of this, many are less likely to use community banks than their parents and grandparents. But that does not have to be the case. These younger generations represent an enormous opportunity for community banks to thrive and grow.

Imbalance in Being “Small,” “Neighborly,” and “Friendly”  and Demonstrated Financial Expertise

Generally, people don’t go to friends and neighbors for complicated investment and retirement advice. They go to people they consider to be experts. Exclusive focus on size and personality has established among community bank customers a strong degree of personal loyalty for basic deposits, but it has weakened some of those customers’ confidence in community banks as experts in more complex financial matters, creating a perception of community banks as places where good people take care of money, not where financial experts handle complicated, consultative financial conversations. Community bank customers store their money with good people; they discuss how to use their money with good bankers.

Failure to Embrace Active, Early Sales Practices and Opportunities

Continue reading “Is Your Community Bank Missing Opportunities with Millennials?”