Should Community Banks take the Planet Fitness Approach?

ID-100334953Recently, an acquaintance told me that he and his significant other had joined Planet Fitness.  There is a Planet Fitness near my home, and I had seen their television commercials, but had never visited their location.  Curiously, I asked him questions about it.  Here are a few highlights.

Judgement Free Zone ®

Planet Fitness claims it not a “gym” and their Judgement Free Zone ® tagline firmly stands behind it.  That means, no outside trainers and heavy lifting (i.e. deadlifts and cleans) is highly fround upon; in fact, “grunting” is prohibited.

The Daily Show had a hilarious report on this very subject a few years ago:

 

The concept of Planet Fitness it to create a welcoming environment to either:

  • People new to working out
  • People who just want a causal, laid back gym environment

In other works, gymrats and crossfitters aren’t the target market for Planet Fitness.

Laid Back. With my mind on my money and my money on my mind!

Planet Fitness is using a “laid back” approach that other businesses and non-profits have been applying for years. Take Non-denomiational Christian churches for example; there is one church in my city that separates itself by telling people to “Come as you are.”  In fact, they have even hosted nontraditional meetings in a bar and call it “Beer Church.”

How does this apply to banks?

There are two lessons banks can learn from this approach.  Intimidation and target marketing.

Intimidation

What’s more intimidating than going to a gym?  How about asking a complete stranger for money.  Isn’t that essentially what a loan is?  A person walks into a “Financial Institution” and literally pleads their case to borrow money.

What if a bank were to make banking, particularly lending, less intimidating?  There are several ways of doing this:

  • In Branch Financial Literacy Classes
  • Participating in Get Smart About Credit
  • CRA Initiatives

The list can go on and on; but first, there must be a mentality, a company culture that welcomes these approaches, otherwise it is just blowing smoke.

Target Marketing

A hot, dynamic term in marketing, especially with community banks.  But how targeted is the marketing approach? Let’s consider home equity lines of credit (HELOC).

  • Do you expect someone with a $150,000 home to be the same type of person who owes a $500,000?
  • Do you think a 50 year old married couple with three children in their late teens to mid 20s have the same needs/wants as a married couple in their early 30s?

If not, why do banks consistently market to those customers the same way?

Banks throw a huge advertising net that includes phrases like, “remodeling, vacation, tuition cost” and the list goes on and on.  Instead of trying to jam as much information out there, wouldn’t it be better served to create a message directly targeting a specific market?

Start with your current customer base and/or with the communities you serve.  Is there a specific demographic you are trying to reach?  Once you answer that question, find out what connects each person in that demographic.

Again, go back to HELOCs.  If you already have a customer base, then use a prospecting tool to gather information.  In this case, let’s say a prospecting tool is used to find out where this customer base lives in your area.  From there, use tools to communicate your message to this audience.

  • Direct Mail Postcards
  • Google Adwords targeted to the Zip Code and street address
  • Display Advertising that can be targeted via location AND by common interest

If you are interested in learning more about prospecting tools, then check out CRS Data’s Banker Suite program.  The Banker Suite contains a prospecting tool that allows banks to search for certain criteria within different counties.

So, take the Planet Fitness approach and pump up your marketing results and beat the flabby ads approach.

 

 

 

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Deliver on Your Word

Sounds simple, right? But what happens when you don’t deliver on your word.  Here is a real life example that happened just a few days ago.

Throughout the year, the Big 12 has been playing the following commercial during every conference game.

The commercial brags that there will be one champion.  The irony: The Big 12 had co-champions this year.  The Big 12’s decision makers couldn’t decide who was better team: Baylor or TCU.

The Big 12’s indecisiveness may have caused their conference a spot in the inaugural college football playoffs.  But instead of blaming the Committee in charge of the playoffs, let’s examine the actual statement from the Big 12.  It’s really simple, deliver on you what you say.

Reputation and Branding

It’s a term marketers and executives use all the time, “Our Brand.”  Regardless if you see branding as a strength or a bunch of malarkey, keeping your word in business is your reputation, and that is part of your brand.  When you go against your word, whether intentional or not, you tarnish your brand.  Once your reputation and brand are damaged, it takes time, energy and money to fix it.  The bad news is that those are resources you could be using to expand your business and increase revenue.  What’s even worse is that depending on how bad it is, it your reputation and brand may never be fully repaired.

Big 12 Example

Big-12-LogosThe following Monday after the Big 12 crowned their co-champions and the College Football Playoff committee named the top four, both national and local sports radio stations started attacking the Big 12.  A local sports show (note that there are no Big 12 teams located near my town of Knoxville, Tennessee) spent nearly an hour dissecting the issues with the Big 12, most notably the fact that there are only 10 teams in the Big 12, which prevents them from hosting a playoff to crown a conference champion. The sports show’s co-host then went on to state how hard it will be to get to two good college sports programs to join the Big 12 due to the fact the conference is not being represented in the inaugural college football playoffs.

Whether this is a short-term or long-term public relations issue for the Big 12, remains to be seen.  Most likely this will fade with time, but the radio host brings up a good point in that it will be hard to recruit a good team and now the Big 12 may have to lower their standards/expectations and bring on two schools that are not of the same caliber as their top performers.

Make Good on Your Word

If the Big 12 would have just picked Baylor as their Big 12 Champion, then maybe…maybe the conference would have a team in the playoffs.

Simply put, if you say you are going to do something, then do it.

But what happens if you can’t deliver on your promise?

  1.  NO overselling: Promise on what you know you can deliver.
  2. Be proactive: Don’t procrastinate; start working on delivering your promise immediately.
  3. Make no excuses: Without compromising your morals or ethics, exhaust every option you have.
  4. Communicate Up Front: If you are running behind on your promise, communicate up front to see if a delay will be a deal breaker.

This all seems like common sense, but unfortunately it happens on a regular basis.  What’s even worse, as customers we accept this type of service and keep giving businesses money for not delivering on their promise. Think about it: how many businesses promise you something and don’t deliver on that promise?  Do they try to make up for it?  If not, do you continue doing business with them?

Commercial Bank Branding and Football Logos

Titans HelmetsHow is it football fans can cheer for teams even though they continue to disappoint fans season after season? Better yet, how can banks learn from this during a period of employee turnover?

Let’s use the Tennessee Titans as an example.  I’m a huge Titans fan and became a fan when Coach Jeff Fisher was the head coach, Eddie George was the starting running back and Steve McNair was leading the team as quarterback.  All three people are no longer with the Titans.

  • Jeff Fisher: Now coaching the St. Louis Rams.
  • Eddie George: Hosting a college pre-game show for Fox.
  • Steve McNair: Traded to the Baltimore Ravens in 2005, retired in 2008 and passed away in 2009.

This season, The Tennessee Titans have a record of 2-10, and consist of:

  • Coach Ken Whisenhunt: A head coach who runs a traditional offensive scheme that contradicts Coach Fisher’s “Run-n-Gun” approach during the McNair era.
  • Running Back Committee: Instead of a starting running back, the Titans use a three-man approach.
  • Quarterback Problems: The Titans have started three different quarterbacks this season.

So why…why do I stay a fan of the Tennessee Titans.

Steve McNair was traded to Baltimore, so why am I not a Ravens fan?

Coach Fisher is in St. Louis, so why am I not a Rams fan, instead of staying with the Titans? 

I originally became a Titans fan due to proximity.  I live in Tennessee, and the Titans are in Tennessee.  But it soon become an emotional connection as the Titans seem to be an underdog.  Shoot, even when Steve McNair was chosen as MVP in 2003, he had to share the title with Payton Manning.

What can Banks take away from this?

Recently I wrote a post that touched on hiring commercial lenders based on their loan portfolio.  The flip side of this is what happens when a bank loses a commercial lender that has a successful portfolio.

Loosing a Strong Loan Producer

It happens to just about any community bank.  The have a top producing commercial lender who gets an offer they can’t refuse from a competitor.  They leave and immediately the bank accepts the fact that they are going to lose current customers due to “their banker” leaving.  Many times, banks start building a reactive checklist, but what if they started a proactive campaign.

Reactive Approach

Making a ListAs the bank starts searching for a replacement, the bank will also review the leaving commercial banker’s portfolio so it can be divided up between their current commercial lenders.

A good bank will also look at the profitability of each customer in the portfolio to see who is unprofitable and see this as an opportunity to “lose” this customer.  Plus, they will make sure to focus their attention on profitable and potentially profitable customers on the list.

This is a good strategy that every community bank should follow, but consider adding a proactive strategy that may already tie into your marketing and sales efforts.

Proactive Approach

Instead of waiting for a commercial lender to leave, consider these tactics to entrench your customers into your bank’s brand.

  • Email Communication: Let’s assume your bank’s sales culture has a calling program in place where your commercial lenders are required to meet with their entire portfolio at least three times a year.  If that is the case, what other forms of communication does your bank use to communicate to these customers?  A bank can create an email program where the bank is sending meaningful information.  It can be about a new service, business advice or anything else that the customer would deem useful.  This approach not only keeps customers in the communication loop, but also ties them to your bank’s brand beyond the commercial lender.
  • Customer Recognition: Find ways that your bank can recognize this customer and their business.  For example, if the commercial customer has a retail business, highlight their business to your customer base, and make sure the customer knows about it.  You may even want to let a bank executive notify the customer.  That way the customer now has a connection another banker in your organization.
  • Connect on Social Media: If you have a company presence on social media, make sure you are connected to your customer base.  Better yet, if your CEO or other executives are on a social media platform (i.e. Twitter, LinkedIn or Pinterest), make sure they are connected with the customer and engaged with them.
  • Team Approach: Most likely a commercial lender works with a team of people when dealing with their customers.  It may be a loan processor, or maybe a cash management specialist.  Either way, it is important that your commercial customers know the entire team.  Make sure your commercial lender introduces the support staff to their customers, or at the very least, their top customers.  Also consider creating a mentoring program, where the commercial lender takes an up-and-comer out with them on customer calls.

Brand Focus

You are connecting your customer to other people and outlets of your bank.  This will continue to establish the brand of your organization by reenforcing the strengths your bank has, and will make any customer think twice before they leave you to join their “former banker.”

Now if the Titans can just get their act together, I won’t be looking for another NFL franchise.

Finding Mr. Right

Having trouble selling a product or service that you think is perfect?

Inspector Jacques ClouseauCommunity banks are finding themselves in this situation.  More and more people are looking to outside competitors for banking assistance.

  • Credit unions are supplying people with low-interest rate car loans.
  • Reloadable pre-pay cards are offering an alternative to traditional checking accounts
  • Mobile apps are creating new ways to pay for bills and exchange money between people

These three options are great, but here’s the catch: community banks offer some (if not all) of these services. The problem is that people either do not want do business with a bank or they are unaware that banks offer these services.

How can community banks overcome this issue?

Image Crisis

Inspector and Chief InspectorIt is no surprise that banks have received bad publicity over the past 6 years.  Bank closures, bailouts and fraud have caused public opinion of banks to collapse.  Unfortunately for community banks, people tend to lump big banks and local community banks together in this mess.

To help overcome this, banks need to work on their public relations efforts by reaching out to potential customers and to the communities they serve.  The issue is that many community banks are stretched thin, so it is important that a consistent message is communicated so you can maximize your exposure.

Keep a consistent message

Call it a tagline, slogan or sayin’, but whatever you call it, make sure you keep it consistent.  By keeping a consistent message, people will start recognizing it.  But remember, even if you and your staff are getting tired of the message, keep it up.  The last thing you want to do is keep changing your message.  Constant change means you are hitting the restart button with your audience.

No Exposure

Inspector and WomanIs your bank advertising, communicating and marketing in the right places? For example, if you are wanting to grow your customer base among 20 -34 year olds, then advertising on an AM radio station between the hours of 10am – 1pm may not be the most effective place.

Make sure you are where your market is, and focus your attention to it.

  1. Research where your target market is.
  2. Craft a message that will get their attention and give a call to action.
  3. Follow through to see if your efforts are working or if it needs tweaking.

As previously mentioned, most community banks are stretched thin, so make sure your communication is done in a creative way that will get people’s attention.

Creative Communication

If a bank wants to increase the number of CDs it has, then running an average newspaper advertisement may do the job, but that doesn’t mean you can communicate the same way when trying to reach a digital based customer.

If you are trying to reach a young, digital audience, then find out where these customers are. Do you have a presence on Twitter or Instagram?  If not, think about how you can translate your message on these sites. Even if you do have a social presence, what are you doing locally to get their attention?  If you can effectively communicate on a digital and local level, you will amplify your message and yield stronger results.

Pay Attention

Inspector BombBefore jumping into new waters, be sure to research.  Make sure your perfect product/service is what your intended target market wants.  Once it is launched and you have communicated your message, listen to your audience.  If your audience likes it, use that as a stepping stone.  If your audience has issues with it, use that as a stepping stone too.

The last thing a community bank wants is their efforts to backfire and blow up like a bomb.

 

 

 

Social Media vs Social Networking

LinkedIn on an IslandSince there is a LinkedIn icon on an island, I believe there needs to be a disclaimer about the following post:

This isn’t a “how to build your business on LinkedIn” post, nor is this a “10 tips to build your LinkedIn profile.”

You can find those types of posts anywhere.  This is more of a “what’s the value of using LinkedIn” post…especially if you are in business development.

On the surface, LinkedIn seems to have the most bipolar perception of all social media sites. Either people use it or they don’t.  But even beyond that, I have seen four types of users

  • The Resume Builder: Normally someone in the entry level side of their career.  This person goes on LinkedIn, builds their profile, adds their connections and then waits for a recruiter to contact them out of the blue.
  • The I was told to User: Should technically fall under the “don’t use” section, but these people use it because their supervisor or other senior company manager has asked them to use it.  This user is disengaged and rarely contributes to their LinkedIn page.
  • The Linked to other Social Sites Participant: The person who automatically has their LinkedIn account tied to another social site (i.e. Twitter).  This way when someone shares something on another site (i.e. Twitter) the message auto-populates onto LinkedIn.
  • The Power User: These are the cats who get it.  And by “get it” I don’t mean the people who find different groups to post a link to their blog.  Not that there’s anything wrong with that (I’m a recovering group blog poster).

I recently finished the American Bankers Association’s School of Marketing and Management (SBMM) and had the pleasure of learning from Jack Hubbard, Chairman and Chief Sales Officer of St. Meyer & Hubbard, Inc. One of the main points Mr. Hubbard pointed out about LinkedIn was this concept: Instead of looking at LinkedIn as a social media site, consider it more of a social networking tool.  Here are a few points that reinforce this concept.

Going Beyond a Resume

In addition to being a Marketing Director, I’m also the head of Human Resources.  Working in HR, people often state they only see LinkedIn as a resume tool; a way to get their name out there.  Though LinkedIn does fill that need for some people, it shouldn’t be seen as it’s only purpose.  In fact, if you’re in sales or any type of business development, LinkedIn has the potential to be a powerful tool.

LinkedIn UsageHere is an example of how people use LinkedIn in regard to the stage in their careers.  The blue represents time spent networking, and shows that every career stage spends a portion of their time networking, as well as reaching out to people on LinkdedIn.  With that in mind, take a look at your profile.  Instead of focusing on what you do, review your profile, and see if it shows what value you add to your customers and your target market.

Preparation

Before going on a sales call, how do you prepare?  Hopefully you research your customer, and their business; but have you ever considered performing a LinkedIn search?  You can view your customer, learn about their business, and see who else works at the organization.  You may even find that you have a connection to the business and the prospect that you were unaware of before your LinkedIn search.

Follow Up

After attending a networking function (i.e. an after hours Chamber of Commerce event) how do you follow up with those you met at the event?  How do you follow up with a prospect or customer after a sales call?  Finding people on LinkedIn and asking them to connect is a good way to follow up.  This can keep you in the loop with them (especially if they are an active LinkedIn user) and can provide you with insight to see what their needs are.

Final Point: Communication

The previous point suggest growing your LinkedIn network, but here are two pointers I have found beneficial:

Invitation: When you invite someone to connect on LinkedIn, there is an automated message LinkedIn uses:

I’d like to add you to my professional network on LinkedIn.

Instead of using this impersonal message, try customizing it base on the person you’re connecting with and why.

Thank You: When you connect with someone, either by your invitation or their invitation, be courteous and thank them for the connection.  It only takes a couple of minutes and can go a long way.

To learn more about LinkedIn, especially if you’re in the banking industry, check out this post from Jack Hubbard and Jason Tonioli: 5 LinkedIn Myths Bankers Need to Shake.

What steps do you take to get the most of our LinkedIn?

 

Alienating Your Fans

ClarkIn January, the Chicago Cubs announced they will be introducing a new mascot named Clark.  The announcement received mixed reviews that created a firestorm of comments on social media sites, sports focused websites, sports talk radio and other communication outlets.

It even caused one of my friends to make the following post on facebook:

John Clark Post

Which eventually led to this:

Pirates Jersey

The Chicago Cubs organization believes the new mascot will lead more families to Wrigley Field, which will lead to increased ticket sales and build brand loyalty to a new, young group; but will it work?

Anytime a company decides to make a change: update a logo or do a complete overhaul of their brand, there is bound to be a backlash.  A company has to decide how much they’re willing to pay for a change by examining the short term and long term impacts.

Price and Reward

short long arrowsBefore making a change, think about what it will cost you in the short term and how that will impact long term success.

Short Term Cost: Before a change is made, a company has to spend time to make sure the change works.

  • Time spent internally pulling the right resources together to develop the change.
  • Cost associated with researching to make sure change is worth it.
  • Assets used announcing the change, both within the company and to the public.
  • Potential loss of profit due to upset customers who decide to shop elsewhere.

Though these points are labeled “short term” they can lead to long term issues.  For example, if the change is so big and confusing, it can take years to effectively communicate the change to your customers.

What benefits will change bring?

  • Possibility of improved customer service and an increase in customer satisfaction
  • Increased repeat business from current customers
  • Brand new customers

The important thing is to make sure the company can survive the short term pitfalls so it can reap the long term benefits.

JCP

One real life example is JCPenny.  In 2012, the company tried to change it’s image from a store where coupons and everyday sales were the norm, to a store that had simple pricing. The change was big, JCPenny not only spent money changing their stores, but created a huge national TV campaign bragging about the changes, and essentially recreated their brand.

This had a negative impact on live long shoppers of JCPenny and created huge hurdles that the company couldn’t conquer.  People went to social media to complain, and the constant negative word of mouth reactions led to JCPenny to back peddle and go back to their old ways.

In the long-run, a strategy like that works on paper, but the backlash from their fan base led to short term losses that were so bad, JCPenny fired their new CEO and brought back the old regime.

So will the new mascot for the Cubs be worth it, or will it end up like the JCP’s simple pricing structure?

Have you

Branding Beyond Logo

National LogosEarlier this week, adweek released it’s list of Best-Perceived Brands of 2013.  According to the website, the list (which included national brands like Amazon, Ford and V8)  is created by asking people if they’ve heard anything negative or positive about the brand.

While looking at these logos, I noticed a few had a level a business model that included a level of customer service.  Two particular examples are Lowe’s and Walgreens.  Both companies are traditional brick and mortar businesses that sell products to people and hire a staff that must provide customer service.

This line of logic is a strong reminder that “Branding” goes beyond just a logo and successful branding is more than a pretty logo and eye catching commercials.

In order for a successful service-based brand to succeed, a business must focus on the staff it has.  A business can have a strong brand if it provides the team with product knowledge, customer service skills and company culture.

Product Knowledge

Homer dohEver walk into a store, ask a cashier about a certain product and get an answer similar to this:

I don’t know.  I just work here.

Drives you crazy, right?

Or have you ever been to a restaurant, asked the waiter about something on the menu and get the answer:

I don’t know.  I’ve never tried the salmon.

Drives you crazy, right?

It is impossible to train your staff to know every question that a customer can ask, but you can at least equip them with enough knowledge to know the basics.

  • Know What You Have: Educate your staff on your products and/or services.  If you’re a restaurant owner, make sure your staff tastes all your food.  If you own a pharmacy, make sure your staff knows the layout of the store and where products are located.
  • Create Study Notes: Be sure that your products and/or services are listed somewhere in writing so your staff can access it in case they need help.  For example, the bank I work at provides a list of services on our Internal website, our external website and printed brochures.

By providing the right training to your staff, you not only prepare them to answer customer questions, you are strengthening your brand and building a strong foundation for repeat business.

Customer Service Skills

jerry_brown_crossed-armsIn addition to product knowledge, your staff also needs to know how to communicate to people.  If you have a knowledgeable team member, but they are a complete jerk to people, odds are you will not have repeat customers and your brand will be tarnished.

  • Soft skills: The last thing you want is to make your customers think they are not welcomed at your place of business.  Make sure your staff understands the importance of making people feel welcomed.  Making eye contact with people and smiling are just two easy examples of soft skills.
  • Courtesy: Simple acts like saying, “Thank you” and “My pleasure” go a long way in service.  Think of the last time you had a positive interaction with a customer service rep, and I bet you the customer service rep used at least one of those two phrases.

These two steps may sound like common sense to you, but not all people are wired the same way and may need some guidance.  By making sure your team has a great set of customer service skills, it will add value to your brand, which will have a positive effect on your company’s success.

Know the Culture

toy robotBe sure your staff understands your company culture.  I’m not suggesting you create a group of robots who say and do everything the same way.  Instead think about a band; everyone is performing the same song, but they have individual parts that make the song complete.

  • Purpose: Be sure your staff knows the purpose of your company.  Some organizations call this their Mission Statement; while others may call is a Company Vision, but whatever you call it, make sure your team knows it and understands why it is important.
  • Goals: Set goals around the purpose of your company and make sure the goals will lead to your company’s success.  This will allow buy in from your staff and they will know they are part of the bigger picture.

Creating a strong culture that focuses on the success of it’s customers and staff will translate to strong profits for a company and lead to a strong brand.

All of these steps sound easy, but they are not.  If they were easy, there would be an infinite number of successful brands.

What brands do you like and why?  Have you ever had a bad experience with a company that has made you stop using a brand?

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