KQ Article

Despite the fact that the economic crisis has clearly changed the nature of business and the expectations of our customers, many of us would love to revert to business as usual. This desire to default to the status quo is part of human nature. Consider how often we see this behavior displayed on Wall Street, in Washington and beyond.

Now that we’re well into 2010, it is a well-documented fact that there will be no returning to normal. But believe it or not, this year of tremendous change represents tremendous opportunity for financial services providers.

For those banks and credit unions that best acknowledge and adapt to the structural changes in the economy — and that most clearly convey those changes to their customers — the opportunities for growth are spectacular.

Be on their side
Today’s public is disenfranchised. We see signs of this everywhere: in voting results, in customer surveys, in purchasing habits. What is at the core of this disenfranchisement? It seems to involve a deep and genuine lack of trust in intermediaries of any kind. This is especially true when it involves anything threatening to get in between consumers and their money. Could this distrust for intermediaries be related to the fact that many institutions that touted their customer focus abandoned the customer when the chips were down — and at a time when consumers needed a trusted financial partner most?

These questions reveal an obvious truth for everyone in financial services: we must respect this new dimension of distrust that every banking customer or member brings to the table. Consumer confidence in the industry is clearly shaken, and by proxy that includes their confidence in the abilities of every individual bank and credit union. We must restore this confidence by doubling our efforts to provide stellar service and become a valuable ongoing information resource.

At the same time, we must achieve these efforts not as a middleman, but as a collaborative partner confronting mutual challenges and working toward mutual goals.

Adapting to new consumer needs
So what steps can be taken to provide exceptional service, while also working to eliminate your role as an intermediary? Here are four suggestions.

All of these suggestions involve getting as close to your customers and members as possible, in the most authentic manner possible.

1. Host frequent public presentations offering insights into developments on Wall Street, Main Street and in Washington, always connecting them to how they impact consumers’ financial future. Deliver these insights via webinars, conference calls and public forums, setting aside time for Q&A discussions in each.
2. Lay it on the line. Offer a realistic snapshot of the challenges your institution and your customers will face together. For example, don’t be afraid to highlight the fact that markets may be overextended given government support. Address the depths of problems within the labor, housing, and real estate markets. And let them in on why your bank or credit union is doing what it’s doing.
3. Get personal. Finances are intimately connected to consumers’ lives and well-being, so immediately focus the conversations on your customers or members. How have their situations changed? How can you help them solve their problems? There’s only one way to get these questions answered: ask!
4. Incentivize your staff for relationship building. Promote those employees who truly embrace the virtues of truth, transparency and integrity that drive the customer satisfaction that is so critical to long-term company success. Penalize those representatives who are fixated on production alone.

Consumers do not want intermediaries who will serve as a buffer to the harsh realities of the economy. They want a partner who will be there right alongside them.

So get out of the role of middleman and swing over to their side, so that it’s you and your customer or member against the uncertainties and opportunities of the industry. Institutions that do so will be rewarded handsomely in the years ahead.

Above all, do not resort to a business-as-usual approach and offer a sigh of relief that the worst of the crisis has passed. While other institutions are climbing out of the bunker mentality of the last two years, those institutions that seize the day will gain real market share and revenue growth.