The title of this post could probably win the award for the most SEO-unfriendly blog post title. Ever. Nobody searching on Google is going to find this post, let alone click on it.
Unfortunately, it’s the only title I can think of. Mostly because it’s the most appropriate title I can think of.
If you’re wondering — and I know you are — Urca is Acru backwards.
And now you’re thinking: “Aha! That clears it up. Not.”
According to Financial Brand, Acru is:
First Cherokee State Bank’s new sub-brand created around its wealth-management division, described as “a revolutionary new retail concept where wealth strategists give away financial wisdom at no charge.”
At the risk of quoting too much from the Financial Brand article, the following caught my attention:
- “Our community space design is intended to be as comfortable as your own living room — great coffee included,” it says on the Acru website.
- “We want you to come in and stay for a while.” “Everything Acru does starts with a conversation,” bank spokesman Rob Kremer explained. “We believe coffee houses facilitate conversation.”
- “The goal at Acru is to remove the transactional element from financial services and create a more interactive, relational environment,” added [Acru CEO Matt] Hames.
So why did I title this post Urca? Because Acru’s strategy is completely backwards:
1. Advice shouldn’t be free. One of the biggest problems in the retail banking industry today is the misalignment between what consumers pay for and the value they get (at least, their perceived value). People don’t like paying $5 month for the “privilege” of writing checks or using a debit card, and they certainly don’t think it’s fair that they have to pay $35 each time they overdraw on their account. It’s analogous to the $100 doctor’s visit that lasts for 5 minutes: You’re not paying for her time — you’re paying for her expertise to make a diagnosis and write a prescription. If a bank wants to get radical, it should charge for advice and give away the transactional stuff.
2. Most people don’t need wealth management advice. Is there a shortage of qualified wealth management advisors in Georgia? If there is, shame on all the existing providers of wealth management services (Merrill, Schwab, etc.) who have overlooked the opportunity. The mass market doesn’t need wealth management advice — it needs everyday financial management advice.
3. Physical location doesn’t matter. Coffee houses facilitate conversations? REALLY? Most of the coffee shops I go into are populated with geeks with their laptops plugged in, silently working away. People don’t want to go somewhere to get financial advice. They want it in the moment: At the point of transaction (when they’re at Best Buy ready to drop a grand on a HDTV) or at the point of decision (when they’re reviewing their finances at home at 9pm on a Thursday night). Acru’s wealth advisors are available from 9 to 5, Monday thru Friday. That’s when I’m working. What’s the rest of the wealth management advice-needing population doing those hours?
I’m willing to bet that Acru will generate more profits from selling coffee than it will from selling wealth management services. Any strategy that centers on getting customers to come to you is completely backwards from the convenience and value that consumers want from their financial services experience.