Be a Bank That “Gets It”

We are all well aware of the dramatic nature of the current economic crisis. However, through what perspective are you seeing the economic crisis? Are you seeing it primarily as a banker, thinking of how you will have to cut non-interest expenses to meet certain profitability goals? Or are you seeing it through the eyes of the consumer, thinking how it is affecting their daily lives? The banks that will not only survive the economic crisis but also gain market share are the banks that will find a way to think about the customer and say, “We understand what you are going through.”

This past weekend, I was able to enjoy some great football games. In doing so, I couldn’t help but notice the commercials. Federal Express has a great commercial showing a group of employees standing in an office bundled up over little campfires trying to stay warm during “Nordic Tuesday.” A Fed Ex driver comes into the office and informs the staff that there are other ways to save money with Fed Ex. The commercial finished with the idea that Fed Ex understands you are looking for ways to save money. In other words, at Fed Ex, “We Get It!”

When going through a crisis, sociologists tell us that people want to know that someone understands and that someone genuinely cares for their situation. It is this understanding and caring that makes a connection between the two and creates a bond. That is why so many great relationships have been borne out of struggle and crisis. Well, the same truth exists between corporate America and the consumer today. The consumer is struggling, and they need to know that you truly understand and care. What are you doing to say, “We get it,” “We understand that times are tough,” and “We are here to help you” through these times?

This is a great time for the bank to become more selfless and creative in their communications. You begin by first thinking about how you can help your own employees during this time. It is not a time to cut back on employee expenses and minimize communication but rather the opposite. More than ever, it is time to build internal brand through our most valuable assets; our people. Some companies “get it,” like Home Depot: “Unlike retailers that have been quick to cut costs by slashing headcount or employee benefits in the downturn, Home Depot is investing more in its employees and stores under the theory that employee satisfaction will trickle down to customers.” Let your employees know that you understand and that you care, and they will become even greater ambassadors of your brand message during this time.

You also need to communicate to the marketplace that you understand and care. I really believe that there has never been a better time for a community bank to rise up and be the community’s bank. People are looking for counsel and help; and, as a community bank, you should be stepping forward to do so. Think beyond expected “safety and soundness” ads that just merely talk about yourself, and let them know that you care about their situation. Look for creative ways to either reduce, waive or forgive fees. While this might work against everything you have been taught in banking school, it will go a long way in showing the customer you understand and care. While the immediate result might not be as profitable, the long-term results will be profitable through market share gained during a recession.

In a recent USA Today newspaper, Bank of America ran the following ad:

“For those who are ready to buy, we’re taking steps to make sure people are getting loans that enable them to be successful homeowners. And we’re going to do that by lending responsibly – which means no hidden fees, no surprises, and full confidence in every borrower’s ability to repay their mortgage. You see, we care as much about helping to keep customers in their homes as we do in helping to get them there. If they don’t succeed, neither do we.”

JPMorgan Chase is doing likewise, taking out eight-page, magazine advertisement designed as editorial content that follows the success of four real women who achieved fiscal fitness. The advertisement ends with a Chase checklist that shows readers how to “Stay a Step Ahead in 2009.”

These are impactful and empathetic messages, delivered by leaders who just also happen to be banks (rather than banks who also lead). They build goodwill as well as offer tangible value.

Your bank should also look for ways to provide more understanding and value, such as educating customers on savings through a whole host of products. The national percentage of savings per person in the past has been in the negative. However, since the crisis, the percentage of savings has increased to 2.8% per person. People are now thinking more about savings than consumption; however, it is not something many have experience in doing. Therefore, let the consumer know that you have everything they need to save for a rainy day.

Years of “business as usual” made bank customers complacent and unlikely to change banks unless there was some sort of major reason to do so. Now, with consumers anticipating more bad news related to the economy than good, they have fundamentally changed their mindset and are rethinking just about everything related to finances and spending, beginning with their core banking relationships. This is the time for community banks to capture greater market share, and win over potential relationships with a message of confidence, understanding and value.

People are struggling and hurting, and they are looking at their banking relationship afresh. As a result, money is in motion, and for the right banks, it will be a time of market share gain that will ultimately result in profitability.

Yes, we are in an economic crisis, but it is also a time of great opportunity that will not come again for a long time. Therefore, what are you doing to communicate that you understand the new realities facing today’s customer, that you care and that you are the community bank who is willing to do something about it? What are you doing to say “We Get It?” What are you doing to set the stage for your bank to be the leader once the dust settles? If consumers think that you truly understand them and care about them, you will create a bond with them; a bond that result in greater market share, greater share of wallet, and a greater profitability.