The Cross-Sell Conundrum
Cross-selling has been the holy grail of banks’ customer relationship-building strategy for decades, with banks striving to gain ever-higher shares of wallet among their existing customers. Because it is so much easier and cheaper to drive revenue growth by selling more to the captive audience of existing customers than to acquire new ones, this approach has gained great credence---until now. With the banking industry in a spin over sales quotas and compensation plans gone mad, all bets are off on business-as-usual sales practices.
Now, many banks appear to be backing away from cross-sales-based compensation plans in their entirety. The new normal is a dismissal of cross selling as the primary objective---in branches, and among sales forces that cater to the important small and medium business segments (SMBs). Bankers are being implored to dump pushy sales practices, and instead, focus on making new friends (American Banker, 2/1/2017, “Pushy sales won’t work. Building a rapport will”).
Just to be clear, pushy sales tactics have never been a good idea. Focusing on the real problems and needs of clients has always been a best practice, as I’ve observed throughout my career, spanning the tech business as well as banking. The best and most successful bankers have never pushed products, despite sales goals and compensation plans that may have over-enthusiastically directed attention to the shiny product-du-jour. Rather, they have directed clients to services and products that genuinely met a desperate, and often obvious, need. All you have to do to be successful in uncovering both obvious and subtle needs is to really listen and empathize with the client. Put yourself in their shoes, and bring your product portfolio and problem solving skills to the table with that attitude.
Others (most famously, Apple founder Steve Jobs) have posited that clients shouldn’t have to, and in fact are ill-equipped, to diagnose their own needs. It’s the job of the product team to know clients better than clients know themselves, and to accordingly deliver products for sale that will delight them beyond their wildest dreams.
Reflecting on my own reaction to the iPad upon its announcement back in 2010, I thought it was the silliest device imaginable. Whatever could I do with that thing that I couldn’t already do on my phone or my laptop? What was it for? After my husband and I gave each other iPads for our birthdays in April 2012, we figured it out. It turned out that our iPads delivered a life changing experience that transformed us into middle aged pre-schoolers engaging in parallel play during much of our free time. (Okay, that’s a joke with just a hint of reality - our iPads, not too small, not too large, but just the right size, with an intuitive UI that makes them easy and fun to use, just as Steve Jobs intended, have enabled truly untethered, anytime, anywhere access to apps, books, our favorite news outlets, social media, shopping, entertainment...the list is endless, and I go almost nowhere without mine at hand.)
Since my day job relates to digital bill pay and invoicing services (as it has for nearly two decades), of course the foregoing observations bring me to that subject. Why is it that banks have packaged free bill pay when cross-selling to SMBs, often in very large numbers with high penetration rates, yet only 10% of clients actually use the service?
I propose three theories:
1. The current bill pay service wasn’t designed in the anticipatory, empathetic manner that successfully identifies needed payment features that are unique to the SMB market.
2. Products are bundled in a way that identifies bill pay as a “free” service, hence, there is no perceived value from the onset, and it is ignored--adoption and usage ultimately suffer.
3. The product selling process itself may have fallen into a pushy kind of experience—and when the service is “free” as a part of a bundle, the client may not even be aware that they have access to it.
All of the theories above can be addressed by products like Bill.com Connect—a cloud based bill pay and invoicing system that integrates into banks’ digital platforms, and is designed specifically for SMBs. It is proven to solve problems businesses have, but sometimes struggle to pinpoint—like why is this payables process so complicated and taking so much of my time? But self awareness is at hand, prompted by a UX that is intuitive and familiar to people working in today’s digital world, designed to deliver ease and immediate value, while driving contextual self-discovery of a rich, fee-based feature set. Businesses can incrementally adopt new features as they go, and as they grow. As an aside, credibility earned by the bankers who help solve the pain point will also grow. What a way to make new friends...and to grow your relationships.