A growing number of community banks are recognizing that new and more aggressive competitors are taking new business they “believed” they would or “should” have. To help combat this they no longer accept the practice of “business as usual.” They are taking the time-proven actions it takes to train, coach and reward their key business development team members to get them out on the street. Program results are showing ROI’s of up to 30—to-1!
This isn’t easy, to say the least. A major culture change is required for most community banks when it comes to selling. Bankers have long been of the mindset that banking is a business built when prospects come to the bank and request the service they want. Unfortunately the consumer has developed a slightly different mindset lately.
“Yes, my banker and I have a good relationship but that doesn’t mean I will only consult them for financial needs and services. There are lots of other options. ” Friends are friends but when money is involved there is a different emotion involved……greed.
The CEO of First Bank in Ketchikan, Alaska, Bill Moran, decided something new must be tried when he started planning for this new year. “I realized that to meet our growth goals we must be more aggressive about taking business from our competition and improve our “unfair share” of our market. There wasn’t sufficient market expansion to maintain our historical growth and profit levels.”
First Bank launched its’ new effort with a 120-day action plan in January 2006 for its’ six branches. The intended focus was to be solely on gaining new customers and establishing new relationships.
“Some of the participating officers found it very difficult to break away from the familiar clients to concentrate only on prospects that had no prior relationship, “said Eric Bjella, VP and Program Manger.
The first step was to assess the sales strengths of each team member. It was important to know who were likely to make calls and build relationships easily (Hunters) and those with good processing and service-related skills but less confidence in their abilities to communicate with prospects (Farmers). This was followed with a professional sales skills training session which included each member identifying from 5-10 prospects.
“The individual assessments and audience reactions to the training were very informative,” said Bjella. “Some of our people felt they never could be successful at making cold calls to strangers. But were they surprised!”
The training showed how to: qualify prospects, make impossible appointments, start building respect and trust from the first appointment, getting to real pains/needs and overcoming objections for desired actions.
The First Bank team met every 10 days in groups of 12 to report progress against their specific targets. While slow at first, calling activity grew and success was gradually achieved. Through coaching and confidence built on successful experiences, sales meetings progressed from a reluctance to report to lively dialogues between members, sharing helpful prospect insights with each other.
One member reported being devastated on her first call, to the point of tears. Executive Vice President Jack Vaughn reported this prospect had also called him to complain, only to contact him later, inviting him to attend a competitor’s bank sponsored business owners meeting. ”Wonders never cease to amaze me, Jack said. I didn’t think we would ever get any where with this prospect and then she did a complete turnaround.”
At the end of the 120 days First Bank captured several new customers, representing over $300,000 in new income to the bank’s bottom line. Less the training expenses that gave a 30-to-1 ROI, income vs. expenses. Other contacts made during this period are expected to move to First Bank in a few months through continued follow-up activities.
A different success story comes from a bank holding company in Iowa. Bank Iowa Corporation felt it was time for a sales culture to be started within at each of its 6 independently chartered banks, serving 17 communities.
“We never had any sales training in our Company’s history, said Michael Thompson, VP and Program Leader. Our CEO, Stan Honken, challenged our presidents to have an officer calling program in place by year-end. I contacted some firms who might help us start a sales culture. After reviewing four, we selected Wemmers Consulting Group from Atlanta. Their program impressed us with its’ accountability factors, experience in bank training and real world application following the skills training.”
Bank Iowa’s Calling Teams intermingled Hunters and Farmers and all branch locations. Their program’s primary goal was to get Bank Iowa folks from behind their desks and out calling on prospects. Sales progress meetings were held every two weeks. A sales progress report, prepared by Amy Armitage, was updated and dispersed to all concerned.
“As Rick had alerted us, calling activity was slow at first but picked up as calling frustrations and excuses were addressed and resolved in the weekly meetings. “We all learned a lot about the process of business development. This will be quite helpful as we continue forward with this program,” Michael said.
It is estimated that Bank Iowa’s 60-day effort helped bring in some $13 million in new business or about $400,000 in new income. Subtracting the sales program expenses this resulted in a 23% ROI.