Beyond the Cross-Sell: Deepening Relationship Banking

By Evan Sparks

Twenty-seven years ago, Micah Bartlett was a first-time bank teller at a small community bank in central Illinois. A few months in, the bank CEO gathered the staff to discuss the topic of the day: cross-selling. “Going forward, we were all going to be about cross-selling,” he remembers.

The idea never had a chance. “I never changed my habits at all, and most of my coworkers didn’t either,” he remembers. “The whole initiative went nowhere.” Why? As a newbie teller, Bartlett didn’t feel like a salesperson—and he didn’t feel confident that he could be one. Moreover, the bank didn’t provide tools and processes to help employees cross-sell, and “there was no discussion about why this is in the interest of our customers. It was all about the bank’s objectives.”

That kind of cross-selling—with a maniacal focus on hitting the bank’s internal metrics—has cast a pall on the whole concept in the wake of the Wells Fargo scandal. But when anchored by knowledge of and tailoring to customers’ goals and desires, cross-selling can be a useful tool for growing business. “You have to have an authentic intention with regard to the customer’s financial goals,” says Bartlett—and you have to provide employees with the tools to understand and meet those goals.

For the past decade, Bartlett has been president and CEO at Town and Country Bank, a $516 million bank in Springfield, Ill. He knew he wanted the bank to be a source of financial empowerment for customers in a way that would deepen customer relationships. So he found himself in the same role as his first CEO—pitching employees on a new relationship approach. “When we first started talking about this at our company, most employees looked at me like I had three eyes,” he laughs. “They were just waiting for this thing to blow over.”

But as Bartlett points out, deepening customer relationships isn’t a trend bank employees should let blow over. It’s core to the banking model. Here are three approaches banks are using to deepen customer relationships:

Outreach, not onboarding

“In many banks, [onboarding] is the end of the relationship,” says Barbara Sanfilippo, a banking sales coach with High Definition Banking. They make sure online banking is set up, the debit card is activated—and not much more contact happens. But Sanfilippo argues that knowing customers’ goals is essential to those deeper relationships.

At Town and Country Bank, Sanfilippo helped Bartlett develop an outreach process that worked. The process includes a sequence of onboarding questions designed to discern goals—plus regular follow-up as appropriate for the customer and their goals.

Sanfilippo urges banks to coach employees to ask questions without pitching products. “When you haven’t built trust with a customer, you don’t want to [sell] first.” For example, instead of offering financial planning for college, an employee can ask, “What are you thinking about for college for your kids?” She also emphasizes the importance of “reboarding,” since many bank customers aren’t receiving regular personal contact. (For example, Bartlett says only 10 percent of Town and Country customers visit branches—until he launched the new outreach program, the bank had little personal contact with the remaining 90 percent.)

The new approach to outreach, only in place a few years at Town and Country, is already paying off. Before 2013, when the program launched, the bank saw 14 percent attrition but only 11 percent new account acquisition. In 2016, those numbers were reversed. “When we are not making our outreach calls on schedule, our attrition numbers rise,” says Bartlett.

Keep track of their goals

For the bank to capitalize on these new relationships, it has to know their goals. Sanfilippo recommends that bank employees enter notes into each customer’s profile with each outreach call.

But banks can also leverage technology to help customers apprise the bank of financial goals themselves. That’s made easier with personal financial management tools. Peter Glyman, co-founder and president of Geezeo, notes that for most customers, major life events—marriage, a baby, a big move, starting a business—are the “trigger to start looking at finances.”

Geezeo offers an ABA-endorsed personal financial management platform that banks can provide as a white-label tool for retail and business customers. Goals entered into the platform make the bank aware of these life events, which—paired with access to transaction data—enables bank employees to target sales to customers who would find the product or service uniquely suited to them. Adding the data capabilities of PFM can help provide a “dynamic experience” with the bank, Glyman says.

That’s especially important with small business customers. “I think the biggest thing you’re fighting is apathy,” says Glyman. “The business customer is not necessarily going to be beating down your door telling you exactly the product and service that they want. Chances are they’re going to go with the product that showed up at the right time.” Instead of just hoping for lucky timing, banks can use PFM and customer outreach to make sure they make strategic offers to their business customers.

Add value without a sales pitch

Banks can build customer trust by providing opportunities to engage in an environment without a direct sales pitch but where they are experiencing added value. Jill Castilla—president and CEO at Citizens Bank of Edmond just outside Oklahoma City—has become famous in the banking world for Heard on Hurd, the bank’s monthly street festival with live music and food trucks. But smaller efforts work too.

For the last four years, Charie Zanck—vice chairman and CEO of American Community Bank and Trust in Woodstock, Ill.—has convened periodic breakfasts for business clients on relevant topics like marketing, operations efficiency or labor law. “Getting your commercial lenders in the room to just listen to customers is a great way to understand their needs,” she says. Her bank also arranges frequent networking events for its business clients, which has resulted in numerous referrals for new products.

Ultimately, programs to deepen customer relationships are a win-win. Bartlett has a story about how Town and Country’s outreach program worked. An employee noticed that a customer had several hundred dollars in magazine subscription payments coming out of her account and called to see if she realized this. The customer didn’t, and she “realized the immediate, tangible benefit of a banker engaging with her.”

That one call resulted in the customer refinancing her mortgage, taking out a stock purchase loan, having a trust meeting and referring more customers. It amounted to $1.1 million worth of business and six new relationships—a big payoff for a little outreach and a little learning.