A good thing for those who did go, that is. I would have drank all the coffee and tried to dominate the conversation. But, considering the issues and topics that were discussed (according to William Azaroff’s guest blog on NetBanker), I would like to have been there. Here’s what I would have contributed to some of the core themes:
What does it mean to be customer-centric? The group concluded that banks and credit unions don’t really know what that means, and they’re right. But bankers could sit around and argue all day and night about what it means to be customer-centric and not get anywhere. Until they reframe the question, that is. What banks should be asking is:
What business model could we create or adopt that would benefit us and our customers?”
The fundamental barrier to becoming customer-centric is not defining what it is. It’s overcoming the fact that the way many banks make money today — through punitive fees, and by maximizing profits from the sale of individual products — is perceived by customers as profits made at their expense.
Do you hear about people complaining to Washington about the high price of iPods and iPhones? The only difference is that we perceive those products to provide a higher value than we do the $30 we pay for bouncing checks. But to the bank, that’s a service they provide, and want to get paid for. And you know what? It’s not the bank’s fault when we bounce the check (usually).
So what does it mean to be customer-centric? It means being perceived as not making money at the expense of the customer. It means helping customers make the right financial decisions for them, not just the company. Will a bank lose a sale because of that? Possibly. But that might be good. If Sprint hadn’t taken on those 1000 customers in the first place, they might not have had to fire them after spending all that time and money supporting them.
And by the way — banks will not become customer-centric by simply asking customers if they’ll refer the bank to their family and friends. They’ll start the journey by figuring out which customers they want to be “centric” to in the first place. And then finding out if those customers believe the bank acts in their best interest, and not just the bank’s.
Is social media an effective way to market and promote banks? This is the wrong question to ask. (Are you beginning to see why it was a good thing that I wasn’t in Seattle last weekend?) Instead, FIs should be asking “how can we use social media to develop and grow our customer relationships?”
More ways “to market and promote” the bank should be low on the list of priorities a bank has. Marketing has invaded every aspect of what we see and do (I won’t be surprised when the pastor at church starts off one morning by announcing that today’s service is sponsored by Fred Smith Insurance on Main Street in Andover). If bank marketers don’t find some boundaries to respect, prospects and customers will adjust. Which means they won’t communicate with banks through social media.
But the potential to engage customers in conversations — which leads to stronger relationships — which reduces the need to “market and promote” the bank — is something that, if I were the CMO of a bank, I’d be testing right now.
What would a bank look like if one was built from scratch today? Why would anyone want to do THAT? Who’d be that crazy? (At which point, I would have been kicked out the door, and sent back to Boston).