Put this in the category of inexpensive, good ideas, smartly executed.
Austin, Texas based Amplify Federal Credit Union (www.goamplify.com) tailored their website to support the University of Texas Longhorns football team. Note the football integrated into the logo, burnt orange school color, message tailored to the Texas/Alabama game.
Amplify is particularly innovative in their products, technology, and retail relationship strategy and I thought this was a great example of creating a greater sense of community with web users.
As more customers (or credit union members) access the bank on-line instead of in-person, we need to find ways to create increased relevancy and immediacy. There are expensive to use the web and social media to build greater personal ties and relationships, and there are simple ones and this is an example of paying attention to what’s important to customers today (and in Texas, college football is always important to your customers!).
How should financial institutions re-think their checking account product mix in light of new OD and NSF fee restrictions?
Over the past decade conventional wisdom suggested that the number of products offered to customers should be reduced. The rationale was that as product selection grew it became harder for consumers to understand the differences between accounts and their pricing, and harder for the sales force to explain their unique benefits. This “paradox of choice”, it was thought, meant that in the face of complexity, consumers became confused and their natural choice would be what they perceived as the least cost option (Free Checking). Want to sell more relationship accounts, the logic went, simplify the product line so the benefit vs. Free checking was more understandable.
But almost 60% of new checking accounts opened were Free anyway.
If you want to improve sales of multiple products, or purchase of add-on fee products, one option is to selectively increase the number of choices. While that may seem counter intuitive (more choice, more confusion?), choosing from a longer menu often results in buyers picking the options presented as best for them. Think of it this way: with only a few choices, most will pick the lowest cost even if they know it may not be the best fit. In its simplest form, give me a choice of only small and large and I’ll choose small. But if you offer small, medium and large, I’m more likely to buy medium.
With a larger array of options, there is an increased tendency is justify the choice of a better product, even if it costs more. The art of the product and pricing mix is to find the right balance between choice and complexity.
It works in restaurants, in computers – and in financial services.
BBVA Compass’s Build-to-Order Free Checking, which can be customized with the addition of up to 7 additional fee based services, is one example of how financial institutions can provide more variations within a framework that offers a more complex product discussion but results in higher purchase of incremental services. On the one hand, this increases the complexity of the product and blurs the distinctions between different checking accounts. It’s not just Free Checking, but a choice of paying monthly fees for multiple incremental add-on services, which might result in equal or higher cost when compared to other products. But from the consumer point of view, this selective complexity creates greater justification to buy the services that are perceived as needed, even if they are not the least cost.
Most banks do a poor job of creating a differentiated brand. They tend to think of the “brand” as the same as the logo. It’s not. Your brand is what you stand for, how you’re different than the competition. When we talk to bankers, and when we conduct competitive shops (more on this in a later post) we always ask “how are you different than your competitors”, and we rarely get anything more than platitudes (“we’re local” or “we’re friendly”). Continue reading
A common complaint: “Budgets are tight and we’re searching for every penny of cost savings. How do we grow without spending money on marketing and sales promotion?” A few weeks ago we published 5 Budget Friendly Marketing and Sales Ideas. Here are 5 more in the series some you know, some may be new, but all are worth your consideration: Continue reading
A common complaint we hear is “Budgets are tight and we’re searching for every penny of cost savings. How do we grow without spending money on marketing and sales promotion?”
It got us to thinking about budget friendly ideas that can be implemented at no -cost, or very little cost. We quickly came up with a list of 25 suggestions before deciding to start writing them down in more detail.
Here are the first 5 – with more to come. We’ll plan on publishing these on a regular basis. But we’d like your input
- if we can come up with 25, why not make it 50? Or 100? Please share your suggestions, ideas and best practices. Continue reading
Wells Fargo has probably more experience using social media than any other bank (see our previous post Look Who’s Blogging and Tweeting). They’ve been blogging since 2005, and their effort has expanded beyond consumer banking to include commercial banking customers.
Darius Miranda, who is responsible for internet services at Wells Fargo’s wholesale and commercial bank, spoke at the Next Banking Conference last month in Berlin about the bank’s efforts. He describes best practices for consumer engagement, as well as the new Business Circle site oriented toward commercial customers. Continue reading
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