4 Compelling Benefits of a Digital Sales Platform

4 Compelling Benefits of a Digital Sales Platform

As head of marketing at Gro, I like to interview our new customers to find out what the driving factors were for their financial institution to implement a digital sales strategy. Some answers are similar, such as wanting to increase customer acquisition. But I’ve also heard many that are creative ways to solve traditional problems and improve the customer experience.

Here are the top 4 business reasons banks and credit unions cite for implementing a digital sales platform:

1. Risk-free expansion into new markets.
I hear this one a lot! Adding a new branch is an expensive commitment when you are testing out a new market. Having the ability to sell products directly from your website allows you to enter new geographical or demographical markets without having to find real estate, build out, and employ a new staff. Simply expand your advertising efforts and direct people to the digital checkout process on your website, and watch your numbers grow.

 

2. 24×7 hours for alternative schedules.
Many small- to medium-sized banks and credit unions cater to consumers who may work or keep alternative schedules. With a digital sales platform in place, your website can accommodate these people by offering the ability to open an account or sign up for a loan when it is convenient to them, not just during traditional bank hours.

 

3. Same simple experience for multiple product types.
Many banking products are decisioned differently on the back-end. For example, there are different qualifications for a checking account than there are for a car loan. With a digital sales platform in place, the front-end checkout process for all types of banking products can be one seamless experience. Customers can simply add products into their shopping cart and checkout, and the decisioning can happen separately on the back-end.

 

4. True omni-channel checkout.
Customers are not one-size-fits-all, and the answer is not to force everyone into using the same channel. A digital sales platform allows you to have a true multi-channel sales strategy, where people can do what makes sense to them on a given day. They can go in the branch, go online, mobile or even via tablet from a community event. Offering multiple channels to do business is a strategy that makes everyone happy.

Digital Account Opening – A Virtual Slip’N Slide

Digital Account Opening – A Virtual Slip’N Slide

 

As kids, we would keep cool on hot summer days by means of a contraption known as a Slip’N Slide. The Slip’N Slide was nothing more than a long piece of plastic or tarp that was drenched in running water. At the end of this runway was an enticing pool of cool water. The goal: run toward the Slip’N Slide at full speed, initiate a short but graceful slide on the slippery surface, and then enjoy the cool refreshing feeling of H20 immersion.
As I consult with financial institutions on how to structure their digital account opening process, I can’t help but be reminded of the days of the Slip’N Slide, and how similar the experiences really are. Everyone agrees on the goal of the digital experience: grow the organization by opening as many new accounts as possible. But how should this look and feel for the customer?

The Run – This is the experience leading up to the actual slide. Existing and potential customers alike should see their goal clearly (the glimmering pool of water) and the benefits of reaching that goal (instant refreshment). This is accomplished by providing them relevant and concise offers at the right time – not overwhelming them with over-burdensome details and product collateral. This should give them reason and purpose to start the journey with the promise of a frictionless and painless ride along the way.

The Slide – Once the customer has been called to action (“apply now”), they should be put into a checkout process that is easy and friction free. Too often I see rocks, bump, tears, and other impediments in the checkout runway that beg applicants to “bail out”. These impediments come in the form of unnecessary questions, opt-ins, or over-burdensome compliance steps that don’t fit the product applied for or the channel of application. To achieve this friction-free experience and maintain the energy of the slide, financial institutions need to re-examine their processes and alter them specifically for the digital world.

The Pool – After checkout, the onboarding process should be pleasant and refreshing. Keep them engaged through their preferred channel with regular communications and other offerings that may benefit their situation. They have arrived at their destination and should now reap the benefits!

How Reducing Friction Made Me a Happy New Customer

How Reducing Friction Made Me a Happy New Customer


The Dreaded Process

Recently I had to help my college-aged daughter buy a used car and I was dreading the process. Why? I didn’t want to drag myself to the used car lot looking for a car I had seen online, only to find it was nothing like it had appeared to be online.  Most of all, I dreaded having to deal with the salesperson and inevitably, their manager who would have to “approve” the great deal they were going to give me, if I purchased today. Friction at every turn of the process.

Begrudgingly, we went to the used car lot and the experience I dreaded began. I was greeted by Chad, who proceeded to show me cars – none of which fit my criteria – but his manager wanted me to know he was willing to deal.  I declined, we shook hands, and I left.  The experience was as unpleasant as the cologne that Chad had doused himself with and now my hand reeked of it.

The Pleasant & Unexpected Discovery

Then I discovered a service called Shift.  Only 3 years old, they are trying to disrupt the used car industry by offering a solution that, in my opinion, is devoid of much of the friction associated with buying a used car that I described above.

Shift’s business model is to reduce friction for the customer to provide a convenient and easy customer experience – something that traditional used car lots haven’t figured out.  Shift’s service includes:

  • an easy-to-use UI that allows you to search their inventory based upon some very basic criteria.
  • bringing the car to your home or office to test drive
  • a free Carfax report
  • a 200-point inspection on the vehicle and documented report of any repairs made
  • an app that delivers virtually the same experience from your mobile device
  • a no-haggle price, and you can set up financing through them
  • 5 days to return it for a full refund if you change your mind

The Happy Ending

I ended up buying the car, and I probably paid about $700 more than I could have somewhere else. But to me, the ease and convenience of the process was well worth it. I’ve become a champion for the company, telling many of my friends and family about the experience as well.

We all have stories like this – where we are genuinely impressed that an often-dreaded task is transformed into a surprisingly easy and almost delightful experience. Customer experience matters, and reducing friction is the key. The technology revolution we are in the midst of is meant to solve for that. In this case, it was a combination of technology and in-person service that made it such a positive experience. The result is a happy new customer who will do more business and is telling friends and family about it. Isn’t that what every business aspires to achieve?

 

Choose an Innovative Partner to Grow With

Choose an Innovative Partner to Grow With

Is innovation important? The answer seems obvious. However, upon review of some recent history, we find companies that did not prioritize innovation and development:  Blackberry, Blockbuster and MySpace come to mind. They thought they could tread water and keep their place in the market, but we know how their stories end.

And then there are companies like Netflix, Amazon and Google that continue to innovate, even while dominating the market.  Who would you rather partner with?  It’s clear that innovation is key to long-term success and growth.  With that said, how can we spot innovation when choosing important partner or vendor relationships?

Here are a few tips to make sure you are not chaining yourself to the next Blackberry:


Is there a roadmap?

When exploring a partnership, make sure to review the roadmap with that vendor. If they cannot present a roadmap, take it as a major red flag. It is not enough to simply throw out ideas in a meeting. The truly innovative companies have a roadmap showing the plan to get there.

How is the roadmap organized?

A successful roadmap needs to have a mixture of short-term and long-term priorities, with new innovations and enhancements spanning the entire timeline. It is imperative that the vendor is using their resources to solve short-term enhancements while focusing on long-term goals. If it is just a list of long-term goals, they will miss all the short-term improvements necessary in this fast-paced world. They might be aiming at building a virtual reality app in two years, but in-between they are missing out on smartphone and tablet enhancements. If the roadmap only consists of short-term objectives, the company can get lost chasing technology “fads” (i.e. Google Glass). Often, companies who only focus on the short-term enhancements are also slow to build for the larger, more dramatic shifts in the market. The best vendors will have a healthy mix of both.


Are they active thought leaders?

A true innovator can be found on the conference stage. They routinely have new features to demonstrate. These companies might also have executives on banking boards and other FinTech innovation committees. This company will be on top of the market shifts and user trends. They are worth a deeper look.

 

Are they open to input?

No one company has all the answers. A successful partner has open lines of communication with their customers to receive their unique perspective and feedback that needs to be taken into account for future design. The best companies engage in dialogue with those customers to make sure they are hearing the concerns or ideas. After some dialogue and filtering, ideas make their way into the roadmap and future of the product. The least successful companies shut the door, and enhancement requests go into a black hole never to be seen again. It is simple: if you don’t listen to your customers, you will lose them.

 

Find an innovative partner / vendor that you can grow with. Surrounding yourself with energetic and innovative thinkers will only boost your own company efforts.

 

 

The Power of the Platform

The Power of the Platform

No, this isn’t a political blog piece – there are plenty of those lately!  The platform I am referring to is a technology platform – one that provides a readily available, well documented, and robust API that allows bi-lateral integration with other applications.

Creating value through integrations.

I’ve had the fortune of working for two companies in the past, Intuit and Salesforce, who have embraced the power of the platform, allowing others to integrate with their solutions to make them better and, conversely, integrating with other solutions or services to add even more value to their own applications. A familiar example is apps that are developed for mobile phones.  If Apple had only allowed apps of their own creation to be offered in their App Store, would the iPhone be as indispensable to consumers as it is today? Platforms allow for sharing work done by others, which creates value tenfold over what just one company can do.

Platforms will continue to grow and will ultimately dominate the landscape for software solutions.  Here are two compelling reasons why platforms for financial institutions are ideal:

1. Forces everyone to bring their A-game.

Salesforce and Intuit are confident that they have the best products and continue to improve upon them.  They are both committed to serving their customers with the best solutions – even if that may open the door to a competitor. They realize they can’t be everything to everyone and so having developers create solutions that improve and enhance theirs speaks to the old adage of “rising waters float all boats”.  If you want evidence of how beneficial this has been to each company’s bottom line, just take a look at the stock performances of Intuit and Salesforce over the past 5 years if not longer.  And for the developers?  There are many examples of companies who have created multi-million dollar businesses building a solution on a platform like that of Salesforce or Intuit (ex: Veeva).

2. Faster and more efficient innovation.

I think everyone would agree that the pace of innovation is only increasing – and much of that innovation is rooted in mobile.  The ability to innovate quickly is something that old technology simply wasn’t built for.  Using APIs to build an application on top of a platform that already has the necessary base infrastructure needed by every software application eliminates a big chunk of development that doesn’t solve a problem.  Instead, developers can focus their resources on creating functionality that adds value.

The financial services industry and the providers who serve them have been slow in embracing the idea of open platforms. Core or back-end systems tend to be closed environments – protected as if each can survive on their own or enough companies can be bought to “safely” integrate with the parent to offer additional solutions (how well has that worked?).

The Financial Brand talks about Banking as a Platform (BaaP) and how we are on the verge of a massive mindset shift for the financial industry, but one that would come with incredible value to everyone involved. FinTech is rife with companies eager to integrate with other providers and each other as appropriate.

 

Easy Account Switching + Engaged Customer = More Revenue!

Easy Account Switching + Engaged Customer = More Revenue!

American Banker reports that the average checking account costs a financial institution $250 – $400 per year. This means the financial institution needs to make at least $250 in interest, fees, and interchange revenue to cover the low end of checking account expenses. The good news: about 60% of checking accounts cover these costs by bringing in $413 per year on average.

On the flip side, that still leaves 40% of checking accounts carrying a net loss. The factors for this are directly attributed to engagement. The difference between profitable and unprofitable is clear:

  • A profitable and engaged account receives a regular direct deposit.
  • Profitable customers have increased account ownership (savings, loans, etc).
  • Profitable customers are using their debit card 15-20 times a month MORE than the unprofitable group.

These actions are the results of an engaged customer with a primary financial institution relationship. The question in the boardroom is: “How do we make sure our new checking account customers are profitable?” No one wants to see that 40%.

The answer is simple: make switching easier and accessible.

Easier” is now defined as making it digital. Remove any paper or mailing from the switching process. Customers today are signing up for accounts completely online.  Do not force a digital customer to use a physical channel, such as going into the branch.

Accessible” means not just providing access, but providing that digital switch kit at the right time. Allow an applicant to start switching their direct deposit immediately from the checking application. The applicant is completely engaged while opening a new account: don’t lose the engagement by sending an email with instructions to a switch kit. Instead, provide a direct link from the end of the application to keep the funnel moving

Making the switching process easy and accessible will make an immediate impression on the newly acquired customer. It will also make an immediate and positive impact on your FI’s bottom line. With each profitable account adding an average of $163 per year in revenue, simple accounting would say this is a no-brainer!

Why Customer Success Executives are Critical for Digital Bank Sales Success

Why Customer Success Executives are Critical for Digital Bank Sales Success

When we started this journey in 2013, before Gro was a company, we thought of digital sales platforms as the third wave of digital banking. First there was online banking, then mobile, now digital sales. In some ways, we were right. But we underestimated how dramatic the impact of digital sales platforms would be for banks and credit unions. 

 

The digital disconnect.

 

Banks have invested heavily in developing and marketing digital products and services and have been successful in moving 85% of transactions from the branch to digital channels. However, 80% of new account sales still come from their branches even though banks have moved to marketing through digital channels. Why would a prospective customer come to the branch to act on an interest sparked by a digital ad?

We dug into it and learned that while banks were using enticing cash offers in their marketing campaigns with great success, more often than not the offer required the prospective customer to open the account in the branch. It seems so obvious to link a digital offer to digital account opening; however this is not being done. When banks do it right, moving to digital sales affects everything. We spoke with our customers and prospects and found great interest in expert assistance to evaluate how the bank or credit union should evolve to better align sales and marketing efforts and how to prioritize it all. We’ve also heard that this lack of guidance is one additional explanation for why 80% of bank sales transactions come from the branch, even if the bank bought one of the solutions from the first wave of online account opening.

 

Use our success coaches.

 

Gro has put together an expert team of Customer Success Executives, each with 20+ years of banking experience, to help FIs make the transition to a digital sales platform. We’ve trained them on what we’ve learned so far, and they have access to cutting-edge proprietary metrics that provide empirical data on what choices are driving our customers’ success.

Furthermore, we’ve setup programs so banks and credit unions have access to these executives throughout the lifecycle of using our products. We believe bank sales growth is an evolutionary process that should be continually evaluated and tweaked to optimize growth. As this space matures, more best practices will arise and customer behavior will change. We think banks and credit unions should reevaluate their campaigns frequently to maximize their customer growth and share-of-wallet.

Our Customer Success Executives are also available to banks and credit unions that aren’t customers. Let us know if you’d like to setup a time to speak with them about how your institution can sell more products and attract more customers.

Happy Selling.

A Growing Demand for Online Account Opening

A Growing Demand for Online Account Opening

Wells Fargo scandal sparks change in how people want to bank.

The fierce public outrage from the Wells Fargo new account scandal caused significant damage to their reputation and implications for the banking industry as a whole. Wells Fargo was fined for illegal practices that stemmed from their corporate culture of high sales quotas, which motivated frontline employees to cheat in order to boost numbers by opening accounts without customer authorization. Wells Fargo was cited specifically for violating consumer protections included in the Dodd-Frank Act that prohibit financial institutions from engaging in unfair, deceptive, or abusive acts or practice, known as UDAAP.

 

Banks are under a microscope

 

With this colossal breach of trust, Wells Fargo became the perfect poster child for the Consumer Financial Protection Bureau (CFPB) to showcase what they do and why it matters. Putting the rest of the industry on notice, the CFPB has pledged to step up their examinations of bank sales practices and to pursue other financial institutions that are taking advantage of consumers. With the regulatory spotlight on UDAAP, all banks must look at their sales practices and make adjustments as needed. Changing a sales culture that is deeply ingrained in retail banking is no small undertaking and will take considerable time and staff retraining. To make matters worse, this all comes at a time when the banks, still reeling from the regulatory reforms that followed the 2008 financial crisis, are under intense pressure to grow revenue.

 

Digital account opening is no longer optional

 

With handcuffs on the frontline staff, the value proposition for online customer acquisition just got more attractive. For some time, online account opening has been an important tool to reach digital-only consumers and allow financial institutions with a limited branch footprint to compete effectively. Since the Wells Fargo scandal, it is expected that more and more consumers will prefer to interact with their bank through an online channel, where they feel more in control and not at risk of being worn down by aggressive sales tactics, or worse yet, duped by the banker.

The regulators are fired up and will be looking at sales practices for UDAAP violations across all channels. A key advantage for the online sales channel is that the rogue human element is not a part of the equation. UDAAP compliance for online account opening can be thoughtfully implemented with technology and audited centrally. While the tough times for banks just got tougher, this turmoil may translate into opportunities for financial institutions ready to connect with consumers looking for a change. Chances are that fed-up consumers will be looking online instead of walking through the doors of the branch.

3 Unnecessary Habits That Keep You From Acquiring More Customers.

3 Unnecessary Habits That Keep You From Acquiring More Customers.

 

Stop doing these today and watch your digital onboarding skyrocket.

They say old habits die hard. And in the case of bankers, this seems to be exceptionally true. With the rapid rise in the use of mobile devices for banking tasks such as account opening, bill pay and deposits; it’s time to leave these antiquated practices behind that undermine your customer acquisition efforts.

Banks need to do everything in their power to make the application process as simple as possible. Reducing keystrokes, limiting decisions, removing unnecessary questions – all help improve the experience and increase your chance for a completed application.

Here are three things that should NOT be a part of your digital customer acquisition process:

 

Physical Signature cards.

I remember going to the bank with my mom in the 1970’s to deposit a check and watching the bankers check her signature against a card they pulled out of a huge file drawer, much like the one we used at the library back then. Signature cards have been in use for many decades, and are just a known part of the banking process that is still in practice today. They made sense 30 years ago when everything was done manually. But today, banks can use sophisticated risk-based tools that can compare a potentially forged signature with a signature from a recently paid low-dollar transaction.

The love affair with the signature card is not just about the signature; banks use them to record the customer’s agreement to the account terms and conditions. Even our lawmakers understood that “wet signature required” was an outdated concept and passed the E-Sign Act over 17 years ago to pave the way for digital commerce. It’s time to break this habit of yesteryear and 86 the signature cards.

Eliminate friction caused by requiring your mobile-first customer to sign and mail a signature card. It’s more convenient for your customers and saves time for your employees. And you aren’t breaking any compliance laws.

 

Point of contact in case of death.

I’m not suggesting that you don’t collect this information at all. I agree that it’s good practice to have another name on file to cover the “God forbid” category. But is this information needed up front or relevant to deciding whether they get approved for a new account or loan? Forcing a potential loan applicant to make this type of decision up front can bring the entire application process to a halt. This can open a Pandora’s box of complicated family relationship decisions that are best avoided on the front end of an application.

Collecting this type of secondary information after the account has been opened and funded removes a huge barrier for new applicants and allows banks to realize deposits and revenue more quickly.

 

On-Screen Disclosures.

Please don’t send your lawyers and compliance officers after me. Disclosures are no doubt an important requirement. In fact the law is very clear; new account disclosures must be provided in a form the customer can retain before an account is opened. The law, however, does not require cramming the fine print on a screen. That is a bad user experience and even impractical given the wide variety of digital devices used today, many of which have limited screen real estate.

But again, it’s about what is needed up front. Assaulting prospective customers with fine print before they can hit submit on their application can seriously delay or derail the whole process. You can comply with disclosure and E-Sign regulations by emailing disclosures during the application process. On screen display of disclosures is old school.

Emailing important disclosures immediately after the critical information has been gathered allows customer to retain and review the documents at their convenience.

The Gro Digital Sales Platform solution has streamlined the account opening process to collect the bare minimum information required to process and approve a new deposit account or loan applicant. Our workflow has been proven to reduce the process from 30 minutes to under 4 minutes, and has our bank customers have seen a significant reduction in mobile abandonment from 80% – 35%.