THANK YOU FOR SUBSCRIBING
It’s stating the obvious that banking and financial services in general are rapidly changing. As an example, there are fewer community banks today than just 10 years ago. In addition, the integrity of the overall banking system has taken some hits due to infringements made upon people’s trust due to various bank practices routinely seen in the media.
"Banks can also seek to be more “teaming centric” rather than compartmentalized internally, and begin focusing not so much on products, but rather the overall services provided"
Another leading factor to the change is technology. Customers can simply go online to obtain a loan, open a savings account, and save for retirement, and at any time of day.
So, the convenience, service, and quality of online banking and investing options limits the customers’ need to walk into a traditional retail branch, or office like a few years ago.
Bank consolidations are also continuing to take place, leaving committed long term institutions harder to find. Thus, customers question how long their bank will be around, much less their banker and/or advisor. This challenges commitment levels to build long term relationships, resulting in scattered and isolated product shoppers rather than comprehensive partnerships.
All of these factors and more are driving the push to commoditize banking and financial services. Thus, a bank’s overall value for example, is reduced to merely a particular product’s rate - and not necessarily the best benefit, guidance, and service.
However, J.D. Power conducted its first 2018 Retail Banking Advice Study showing that roughly 78% of those who responded said they were interested in receiving financial advice or guidance from their bank. However, only 28% said they ever received that advice.
In summary, people desire guidance and comprehensive financial consultation from their bank. The problem is few actually ever receive it.
Therefore, one of the best opportunities to remain competitive and relevant long term amidst this rapidly changing environment is for the local financial institutions to become the go-to places in their select communities for customers to easily obtain simple, yet comprehensive financial education and guidance.
Thus, knowledge is banking’s greatest asset and sharing it is it’s greatest opportunity. This is also why a team based wealth management platform can serve as a key advantage for banks that deploy it effectively and holistically.
Granted, there is a plethora of information online, but something powerful happens when silos are broken down, and personal financial expertise is collected and congregated for the overall well being of a client, their family, their business, and the overall community.
Sound like too big of a task? Zig Ziglar once said, “the greatest way to get what you want is to help others get what they want”. Banks are in ideal positions to do just that. For many possess “vaults” of diverse financial knowledge, and these are potent assets of stability and stimulus when shared and distributed throughout our communities.
If local financial institutions can begin to truly become comprehensive advisors that aspire to help their customers and communities thrive across the spectrum of all their financial dreams and goals, everyone wins.
The client wins because they gain comprehensive advise, not product pushes. The financial institution wins because they build longer and deeper relationships. Communities win because sound financial stewardship practices begin to take root in families, and businesses - thus stimulating our local economies.
For example, banks, and other financial service providers can begin hosting and measuring how many financial education events they conduct in their communities and for their clients that are not solely for solicitation purposes, but rather to share supportive financial insights and strategies. These could be as broad as security clinics, retirement strategies, fraud protection, budgeting, and financial planning.
Banks can also seek to be more “teaming centric” rather than compartmentalized internally, and begin focusing not so much on products, but rather the overall services pro-vided.
Joint appointments between internal team members unifying to help customers can be rewarded; and helping people based upon their needs and not merely their net worth can be an aspiring objective.
With these simple strategies, and expanded approach to banking and wealth management, I have seen examples where clients with poor credit, and who had abandoned the dream of ever owning a home, were advised through a consultative team approach and over time, improved their credit scores and eventually realized their dream of homeownership.
I have also seen multi-millionaires who had outdated, or little to no estate planning in place advised by a team they trusted to eventually establish plans that helped leave legacies that protected, distributed, and repurposed more than just their money, but their deepest desires as well.
It’s an old fashioned idea, but if we treat and help people the way we want to be treated and helped, we eventually build long term relationships. These relationships then refer others to us, and as we advise rather than commoditize services, customers are more comfortable and willing to satisfy more of their financial needs with us.
Thus, the company grows alongside our clients and communities as a partner, and not at the expense of them.
The best banks and businesses always choose to use their platforms to serve the greater good of their communities and clients. In doing so, they benefit by building a loyal and financially empowered customer base that leads to sustaining long term growth.
While the temptation in the market place is to simply provide value based on rate and cost, the demand is actually for more reliable comprehensive financial advice. The challenge is therefore moving from a product mentality to a trusted advisory mindset - and this is where the differentiators reside.
In closing, customers will continue to migrate to the places that choose to provide these more comprehensive and collaborative approaches, and as they do, the hope is that more organizations will begin to adjust their culture and missions to begin embracing this broader vision, as some already have. Thereby resulting in greater benefits to all and repurposing banking to its higher calling, place, and potential in our society.