Every credit union and bank thinks like a financial institution. After all, that’s what they are. But what if we thought more like an entrepreneur. Credit unions and community banks are much more like small businesses and as a result we can learn from their strategies and tactics.
Running your business like an entrepreneur is much like riding a rollercoaster. At least that is what Darren Hardy argues in his book The Entrepreneur Rollercoaster: Why Now Is The Time To Join The Ride. Because of its title you might not think it’s an appropriate book for C-suite executives or managers within a credit union or bank to read. Actually, nothing could be further from the truth.
Below are a few principles from the book and how we can apply them in the financial services world. Be sure to pick up a copy of The Entrepreneur Rollercoaster and start your ride today (it has many ideas from which we can learn).
(1) You have to love
“After years of studying the success of the world’s leading achievers across a spectrum of disparate fields, my conclusion time and time again has been that those who are at the top of their game are really just people who have found something to love,” Hardy says. Do you love your credit union, your bank, your branch, your department, or your particular field? If you are not doing daily tasks because of love, then they are just tasks.
- Application: Find what makes you passionate about your job. And also hire people who love. Yes, love is a squishy subject. But it’s also a realistic profit driver. Hire for passion and love and then train the rest.
(2) You have to sell
Entrepreneurs don’t succeed unless they sell. And your credit union or bank won’t succeed without it as well. Far from being a dirty word, sales is actually the engine that drives results. As Hardy puts it, “Like it or not, the one thing that matters most in determining whether your business succeeds or fails miserably is sales.”
- Application: Don’t shy away from using the “S” word. And make sure you are training your staff in sales. But don’t do the same boring sales training as every other financial institution. Rather, offer advanced sales training and engagement training. Both are far more effective. Remember the principle that true selling is simply helping.
(3) You have to hire (well)
Hardy refers to hiring the right people as “filling the empty seats.” He quotes the principle from Jim Collins book Good to Great by saying “The single most important thing you need to do is to pick the right people and keep them. There is NOTHING more important than this.”
- Application: Get the right people on your bus and get them in the right seat on the bus. Your credit union or bank will only succeed as much as your people succeed. Stop thinking that your brick and mortar branches are your assets: it’s your people who are your true assets. Invest in your employees by encouraging them to learn. The more they learn, the more your financial institution will earn.
(4) You have to lead
Not seeing the results or the performances you want with your net income, capital ratios, brand growth or new branches? According to Hardy, there is only one person to blame when you are an entrepreneur. “The number one bottleneck or constraint to the growth of any organization is the leader,” Hardy writes. He adds, “You’re to blame. Top to bottom, front to back. Everything. Is. Your. Fault.” That might sound harsh, but the reality is we should be quick to look in the mirror rather than across the desk when analyzing our credit union or bank shortcomings.
- Application: Don’t just invest in your employees’ training. Invest in yourself as well. One of the best things you can do at your financial institution is to grow your leaders. Your teller supervisors, your branch managers, your department heads, your vice presidents and your “C-Suite” executives. From a practical standpoint, consider investing in leadership training.
Those are just a few key points from The Entrepreneur Rollercoaster. The book offers many more ideas about growing your business. It is also one of the few books you can read more than once because each read is like its own unique rollercoaster ride.
If you want your credit union or bank to succeed then stop thinking and acting like a financial institution executive or manager—instead think and act like an entrepreneur. And one of the first books you should read to help with that approach is The Entrepreneur Rollercoaster: Why Now Is The Time To Join The Ride.
I recently had the opportunity to hear Kelly McDonald keynote a session at the National Speakers Association on “How to Market To People Not Like You.” It is based on a book with a similar title: Crafting the Customer Experience for People Not Like You: How To Delight and Engage the Customers Your Competitors Don’t Understand.
“If I can figure out what you value, I can get into your wallet,” McDonald said. When defining diversity, she went on to explain that she actually doesn’t like that word. “It’s really more about people who are not like you,” she said. For example, she does not have children so those people that have kids are not like her. Therefore, people not like you comes in many forms: gender, religion, age, generation, ethnicity, geographic, etc. (this list is endless).
“Understanding someone different from you means understanding their life,” McDonald added.
She offered six strategies for marketing to people not like you:
- Be relevant—“You need to identify what people want and then give it to them,” McDonald said. She noted that Target succeeded where K-Mart failed because Target’s strategy of “style on a budget” resonated with women.
- Tap into their values—Different people value different things. For example, women do more research online and value testimonials and reviews while Millennials value diversity and interaction.
- Use key customer insights to sell more effectively—The more you know about your target audiences, the more effective your marketing to them is. She used gender as an example to support this point. She noted that women value expansive choices (they want to see a lot of options) while men just want three options (less than three is too few and more than three is too much).
- Pay attention to trends—“Fads come and go while trends are shifts and movements,” McDonald said. For example, social (not necessarily social media) is a trend. “People take selfies to share them; we are never going to stop sharing.”
- Figure out your FAB—The acronym FAB refers to features, attributes and benefits. “Nobody cares about your company,” she said. “They only care about what you can do for them. Focus on selling your benefits and not your features.” She used Bluetooth technology in your car as example: Bluetooth is the feature, hands free talking is the attribute and safety is the benefit.
- Be fearless—“You can’t stay in your comfort zone,” McDonald said. She noted how Harley Davidson recently changed its marketing strategy from one that targeted Boomers to now one that targets females.
She summed up her talk with one final thought: “Helping beats selling. Find out what your targets are struggling with and how you can help them with a solution.”
If you ever have the opportunity to hear McDonald speak, I highly encourage you to do so. And if you can’t catch her at an event, pick up a copy of Crafting the Customer Experience for People Not Like You: How To Delight and Engage the Customers Your Competitors Don’t Understand.
In the past, the majority of consumers would make visiting your bank or credit union’s nearest location a part of their daily or weekly errands schedule. Some locations even became a kind of gathering spot for consumers, where they could sit, have a cup of coffee and catch up with each other on the news and events of the times. They deposited and withdrew money, visited with tellers and signed various required documents.
This is a great memory. Makes me feel all warm and fuzzy. But the fact is – it is just a memory. A geological shift in the way consumers interact with their financial institutions has changed this way of thinking forever. More and more, consumers never come to an actual brick-and-mortar facility. They choose to interact with your bank or credit union in its digital format. This means your website, social media channels, email, etc.
And increasingly, financial institutions are spending less on actual physical locations and more on beefing up their digital mobile presence.
Some in the industry argue that this means branches are caught in a gradual extinction process. Others believe that there is still a place for physical branches, but that they must adapt and find a new way to serve consumers.
I fall in with the latter group. Certainly, branches are changing. But I don’t believe they are dying. Banks and credit unions must look at their branch facilities strategy with new eyes — eyes that view them not so much as branches anymore but as engagement centers.
An engagement center, unlike a traditional branch, is much more than a deposit/withdrawal/sign a few documents facility. Rather, it serves as the physical embodiment of your brand. It is also a location that actively encourages openness and interaction between consumers and your staff. Gone are the days of the traditional teller line and office-with-doors format. Open floor plans, clear lines of sight and attractive, brand-centric architecture and decorations are key.
The next time your executive management team meets to discuss its brand strategy, be the brave soul in the room that stands up for the concept of engagement centers. They lend an air of humanity and personality to your brand while still serving the important functions of a physical facility that justifies its expense.
It’s that time of year again: strategic planning sessions are here. Once autumn hits, it’s not just football season—it’s planning season. Whether it’s finding a facilitator or gathering data, there are many steps we can take before the session to ensure the planning process goes smoothly.
Every year I blog about “10 Questions to Ask At Your Strategic Planning Session.” While those were applicable in 2014 and 2013 (and you can still use those this year as well), here some fresh questions for 2015. In fact, you can ask these questions in a pre-session survey of attendees (we do that with many of our clients).
Regardless of how you use them, below are ten questions you should ask during your strategic planning session.
- What do you want your credit union or bank to look like in 2020?
- How can we simplify how people do business with us?
- If we could “fix” or improve one area of our financial institution, what would it be?
- What is our merger strategy?
When the calendar flips to December, 2016 what do you want to say we accomplished this year?
Those are a few ideas to help you kick-start your strategic planning discussion. They are designed as open-ended questions to start your executive team and board of directors thinking.
What other questions would you add to the list?
Note: The following is an excerpt from 30 Ideas to Build and Live Your Brand. For a free copy of the complete book, click here.
Brands are not just brochures and logos. They are feelings. They connect with consumers on an emotional level. Those emotions are very much tied to and often triggered by our senses – sight, smell, sound, taste and touch.
Think about one of your favorite memories. Is there a certain scent or sound you associate with it? Does that memory pop up when you taste a certain food or see something special like a painting? Those are the same kind of sensory experiences you want consumers to have when they experience your brand.
That’s not always easy in financial services, because we are not selling tangible goods. But there are other ways to tap into those senses. Umpqua Bank allows some of its business partners to display their goods in its branches. In San Francisco, one of its partners puts out chocolates. A credit union in the southern part of the country pays someone to spend 20 hours a week baking at one of its branches so consumers smell baked goods when they conduct their financial business.
Our sense of smell is actually the most sensitive of the five senses, which means scent can have a powerful effect on consumer behavior. The human nose can distinguish more than 10,000 different odors, and studies have shown that 75% of emotions are triggered by smell. Scent is such a big deal in business that companies pay a lot of money for scent marketing. They brand their own scent.
A few years ago when Sony wanted to make women feel more welcome in its stores, it infused a customized scent of vanilla, mandarin, bourbon and other secret ingredients into its stores. Hunkemöller, a Netherlands-based lingerie retailer, increased sales by 20% when it added a chocolate scent to its stores.
What about sound? A colleague has admitted to me that sometimes she finds herself shopping in a local grocery store much longer than she intended because she enjoys the music piped into the store. She doesn’t even realize it until she finds herself singing along and then looks at her watch. Does she spend more money than she intends to? I’m willing to bet she does.
Humans are multi-sensory beings. We need to make sure we are tapping into as many of the five senses as possible to connect with customers and members. You don’t have to invest in your own branded scent or even pay someone to bake cookies at your branch office. Something as simple as brewing coffee or popping popcorn in a central spot of your branch can arouse the senses. The look and feel of a new car in the branch can invoke the sense of touch. The music you pipe in and the volume at which you play it can impact your audience’s behavior.
Just remember to be consistent. You want members and customers to look for these same sensory experiences every time they arrive. That’s how you connect with them on a deeper level.
For a free copy of 30 Ideas to Build and Live Your Brand, click here.