SELLING THE BANK

Presented by S. Cox

SECTION 1: MARKETING AND PROMOTIONS Objectives:

Explain how customer needs and wants are used to identify a target market.

Describe the components of a marketing strategy and how it is developed.

MEETING CUSTOMER NEEDS All consumers have needs and wants

Need – something a person must have to survive Such as food, clothing, and shelter

Want – something a person would like to have but does not need to survive Such as cell phones, jewelry, and brand new car

By identifying their target market banks can give their customers what they need

MEETING CUSTOMER NEEDS: IDENTIFYING A TARGET MARKET Banks like other businesses…

Set up in locations where they can get customers

Design products and services to help those in the community in which they serve

No matter the product, not everyone will want to buy it

To reach the right consumers, banks must first identify them

MEETING CUSTOMER NEEDS: IDENTIFYING A TARGET MARKET Some questions to consider…

What characteristics do these consumers haved in common?

Are they saving money to buy a house?Did they recently buy a car?

Knowing the characteristics that potential customers have in common help identify a market segment…a group of consumers that share common wants and needs

MEETING CUSTOMER NEEDS: IDENTIFYING A TARGET MARKET Four types of market segmentation

Demographic – age, occupation, gender, family size, income, education, and ethnicity

Geographic – region, country, state, block, neighborhood, city

Behavioralistic – benefits sought, usage rate, brand loyalty, purchase frequency

Psychographic – habits, interest, opinions, hobbies, activities, lifestyle

MEETING CUSTOMER NEEDS: IDENTIFYING A TARGET MARKET By breaking consumers into segments,

banks can focus their marketing efforts on those who are most likely to become customers…this group is called the target marketThe market segment that will be the focus

of the marketing strategy

MEETING CUSTOMER NEEDS: MATCHING BANK PRODUCTS & SERVICES TO NEEDS & WANTS

Once the target market is identified, the bank can match the needs and wants of these consumers to its products and services

Products and services are designed or modified by analyzing the needs and wants of a certain market segmentExample on next slide….

MEETING CUSTOMER NEEDS: MATCHING BANK PRODUCTS & SERVICES TO NEEDS & WANTS

Characteristics of mortgage loans (the product)

Needs and wants of first-time home buyers (the target market)

Small down payment Small amount of money saved for down payment

Competitive interest rate Low mortgage payments

Few closing fees Low closing costs

Roll closing costs into the mortgage loan

Low closing costs

Flexible credit requirement Approval with short credit history

No penalty for prepayment Increased income over time

DEVELOPING A MARKET STRATEGY Advertising – calling attention to a

product or service, commonly through the use of paid announcements

Marketing – the process of introducing a product or service to the consumers who can purchase it

DEVELOPING A MARKET STRATEGY: ASPECTS OF MARKETING

Marketing

Advertising

Market Research

Pricing

Sales Strategy

Customer Support

Distribution

Media Planning

Public Relations

DEVELOPING A MARKET STRATEGY Plan is developed around the four P’s of

marketing Product – What products or services meet the needs of

consumers in the target segment? (examples: certificate of deposit, savings account, mortgage, or mobile banking app)

Place – How will the product be available to customers? (examples: online, at a bank branch, ATM, Smartphone; regionally, nationally, or internationally)

Price – How much will the product cost the consumer? (examples: fees and interest rates are paid as well as charged)

Promotion – How much will the product be announced? (examples: TV ads, billboards, Internet, social media, or a combo)

DEVELOPING A MARKET STRATEGY: CREATING PROMOTIONS Promotion – an activity that increases

consumer awareness of a product In the past – heavily relied on advertising which

included TV and radio or in newspapers and magazines

Today – promotion is more dynamic Distributing pens with the bank’s logo Sponsoring a city-wide event, a concert Creating a web site Sending email or social media updates to customers Distributing calendars or some other daily-use

product Holding seminars to help customers that are

considering financial milestones

DEVELOPING A MARKET STRATEGY: MAKING A SALE Some sort of contact is needed to make

a saleSelling occurs in many ways but for banks

personal selling is the most common…each time a bank employee comes in contact with a customer or potential customer

Cross selling – personal selling strategy that encourages existing customers to buy new products based on their previous purchases, sometimes called relationship-based selling Result of existing relationship Requires interaction between bank employees

DEVELOPING A MARKET STRATEGY: MAKING A SALE Event based selling – personal selling

strategy in which a bank employee contacts a customer because of event that has recently happened with the customer Example: when a customer visits a web site and

requests information about home mortgages which may trigger a personal email from the loan officer inquiring if any additional information is needed by the customer

SECTION 2: BUILDING RELATIONSHIPS Objectives:

Describe the elements that create a positive image for a bank.

Explain the importance of customer service in keeping customers.

THE BANK’S IMAGE What qualities would you want a

stranger to have when you consider giving him or her your life savings to hold for you?

Wouldn’t you require the same qualities from your bank?

THE BANK’S IMAGE Public image – made up of the ideas and

opinions that people have about the business It’s easier to hire and retain employees, acquire

new customers, and keep current customers with a positive public image

A bank must be seen as honest, stable, and an important part of the community

Even though all banks seem to be honest and stable, they also need to appear unique in some way Maybe emphasize their customer service or

community involvement

THE BANK’S IMAGE Economic strength of a community often

depends on its ability to get creditBanks can contribute to the local economy

by making loans to individuals and businesses These loans help create jobs and bring revenue

to its citizens

THE BANK’S IMAGE Banks also engage in the communities

that they serveSponsor community events…marathonsFinancial education to consumersExecutives serve on civic boards and local

chamber of commerceCustomer service

THE BANK’S IMAGE If the bank’s reputation is damaged they

may need to repair itReplace some of the managersChange how they qualified potential

borrowers Institute other policy changes

WHAT IS CUSTOMER SERVICE? Customer Service – all interactions

between a customer and the bank Customer – an individual, organization,

or business that purchases a product or service

WHAT IS CUSTOMER SERVICE? Starts with the first interaction between

the customer and bankClick on a web siteComment overheard about the bank while

at workUse of an ATM at the mall

The difference between poor customer service and great customer service is the difference between losing and keeping a customer

WHAT IS CUSTOMER SERVICE? Every bank employee is a customer service

representative…each must avoid unethical and inappropriate behavior

To provide positive customer service, employees should:Address the customer by nameKnow the products and services offered by the

bankApply their expertise to the customers’ needs to

find the right product that is right for him or herExceed in the customer’s expectation for service

WHAT IS CUSTOMER SERVICE? Building rapport with a customer will

increase his or her satisfaction with the bank Rapport – a bond of mutual trust

Having good rapport is central to a successful and ongoing business relationship

Customers expect good service and if it’s exceptionally good or poor chances are he or she will mention it to others Word of mouth advertising – type of promotion

in which customers tell others about their experience with a specific business

WHAT IS CUSTOMER SERVICE? Methods of achieving rapport:

Language Use speech and body language similar to the

customer Be aware of your nonverbal communication as well

as that from the customer Cultural

Find shared interests and experiences Be aware of cultural differences

Other Create a positive environment Be open to doing something for a customer for no

immediate return Identify barriers and work to remove them

WHAT IS CUSTOMER SERVICE? Customer service representatives are an

important part of customer service but quality products and services enhance the banks image and generate customer loyalty:LocationsHandicapped accessibility International serviceSecure web sites