Financial Wellness and the Better Bank

By Barbara Sanfilippo

Are you missing a growth opportunity?

Imagine this scene: As customers walk into your branch or call in for help, your staff has been trained to think, “I wonder what pain, dream, or goal this person has today and for the future? My job as a financial coach is to find out.” Imagine how this would radically change the conversation, create loyalty and impact share of wallet.

In case you haven’t noticed, there’s a growing movement in the financial services industry to improve customers’ financial health—not just sell them something. Not only is this a higher level of service but in the digital age, we predict improving consumers’ financial well-being will be an essential to differentiate your bank and create a competitive advantage.

Doctors improve physical health—bankers must improve financial health.

I had an “aha moment” while sitting in the waiting area for a doctor appointment. My doctor’s job is to ask really good questions, diagnose my ailment and offer the best remedy to restore my health. She’s a health partner in my life journey and I take her advice most of the time. It’s really that simple. Then I thought, “So why is there a scarcity of bankers who place a priority on the simple concept of helping customers improve their financial health?”

You may be thinking, “But we give financial advice all day every day.” To that we quote Ron Shevlin from Cornerstone Advisors: “Too often, what banks try to pass off as advice is nothing more than marketing offers. In other words, the ‘advice’ is what’s good for the bank, and not necessarily the customer. Even when advice is what’s best for the customer, it’s hard to prove it.

Consumers want you to help them improve their financial health.

A 2015 Gallup survey of 11,809 adults clearly demonstrated that “consumers want banks to improve their financial well-being, not just sell them products.” Some other key findings include:

  1. When customers strongly agreed their banks looked out for their financial well-being, about 84% were fully engaged and none were actively disengaged.
  2. Banks that take the time to address customers’ financial health saw strong consumer confidence.
  3. Unfortunately, only one in four respondents strongly agreed their bank looks out for their financial well-being (sounds like opportunity to us!).

Why do we undermine the customer relationship by focusing our staff on pushing products and getting a sale instead of diagnosing what stands between customers and their financial health? They’d be just as likely to purchase products (or even more so) if they saw we had a genuine interest in helping them better manage their finances.

Financial wellness offers a great opportunity to improve the customer experience, enhance engagement and increase revenue generation.

As bankers, you certainly are aware that financial anxiety is at an all-time high. Here are some grim stats from research by Dave Ramsay’s organization:

  • 70% are living paycheck to paycheck.
  • 24% of pay is spent on non-mortgage debt such as credit cards.
  • 64% don’t have enough cash to cover one month’s mortgage cost or groceries.
  • 56% of Gen X workers (age 36-49) say they’ll need $1-2 million to retire comfortably yet they have an average savings of $70,000.

People represented by the above percentages need more than just isolated products without further guidance. They need a financial partner. The numbers illustrate the need. Here’s the want:

  • Millennials are actively seeking financial advice and need help building credit, saving, and managing finances.
  • Business owners are looking for financial education for employees.
  • Boomers and seniors are concerned about income protection and many are looking for help.

Is your staff diagnosing for financial wellness or just selling isolated products?

Face it; your customers don’t want your products! They want to alleviate a pain, reach a goal, or enjoy financial peace. Read this finding again: The Gallup study clearly demonstrates that consumers want you to improve their financial well-being, not just sell them products. Our job as bankers is not simply to sell a product but diagnose correctly. Unfortunately many of your staff is thinking “what can I sell this person today.” Here’s what we see all too often:

  1. Most of us are stuck in the old, tired 1980’s sales training model of transactional product-selling. Our staff is trained to listen for a cue so they can quickly discuss product features and benefits. Unfortunately they are not skilled or comfortable in uncovering financial anxieties, goals, and dreams—that builds the customer relationship.
  2. Monthly product goals and incentives encourage short-term sales, the wrong behaviors, and a very underwhelming or repelling customer experience. As a result, there is no emotional connection. Emotional motivators are the key to stir your customers to take action.
  3. Your marketing slogan or brand promise claims, “We help you achieve financial security and reach your dreams.” However, that’s not what people are experiencing.

Is it time to change your direction? Here’s what you can do.

With strategic planning coming up this fall, we challenge you to rethink and redefine your sales model. Does it support your philosophy and branding? Are your employees highly engaged and feel they make a difference in the lives of your customers? Are you missing out on the growth opportunities improving financial health offers your bank? If changing course is under consideration, here are some actions items to consider.

1. Be sure to include an objective in your strategic plan that your bank is advancing beyond a transactional, product selling model to a relationship-advice In fact, consider playing down or removing the term “sales culture” and replace it with customer relationship-building culture.

2. Re-evaluate and upgrade the role of your branch employees. Create a team of elite financial coaches armed with interactive tools and skilled in engaging customers to discuss budgets, goals, pains, and dreams. Your personal bankers and new account representatives don’t need to be licensed. However, they do need to enjoy educating, guiding, and discussing basic money management principles.

In a recent Financial Coach training for a community bank, I was quite pleased to see how excited and receptive the new account reps were to this educational approach. They were proud of their enhanced role and relieved it wasn’t about pushing products. In fact a few days after the onsite program Jaclyn sent me the following email. Clearly she provided a highly differentiated and engaging experience for this customer.

“I was just meeting with a customer and we went over the budget and the financial wheel. SHE IS PUMPED about saving money, fulfilling her dream of buying a new house and creating financial stability for her family! She is going to go home, fill out the budget with her husband and is coming back for more coaching with me.  She said, ‘I didn’t know a bank did this stuff and I had no idea of any of this. Thank you so much.’ It makes me so happy to help a family this way.”

3. Remember, technology doesn’t build relationships—your people do! Examine your existing sales training to determine if it focuses on transactional product selling and product pushing. Decide to invest in relationship management and financial coaching training instead.

4. Take a hard look at your current incentive plan as it may be driving the wrong behaviors. Ultimately you want to grow share of wallet with each customer over time. In addition, be sure to recognize key activities such as pre-call planning and entering life events, anxieties, goals, and dreams in the customer profile in your CRM. In fact, consistent profiling and recording of customer financial goals and progress is an expectation.

5. Educate your leadership team and board on the benefits of a relationship-driven approach combined with financial health and education. Many clients find these white papers and our blog posts valuable as advance reading before strategic planning.

At High Definition Banking we believe if you want your bank to thrive and be relevant in the lives of your customers, you must be genuinely committed to improving their financial health and well-being. In doing so you will have a loyal following that considers you their financial partner and doctor. Bottom line, it’s time to turn your retail staff into financial educators and coaches!

Barbara Sanfilippo is an award-winning speaker, coach, customer relationship consultant and founder of High Definition Banking. Her training and consulting firm partners with banks to instill a structured relationship management process to accelerate organic growth and focus on the financial health of customers. Email: [email protected]. LinkedIn.

Hear more from Barbara Sanfilippo when she presents at the ABA Bank Marketing Conference, September 24-26, 2017. We look forward to seeing you in New Orleans!