Banking

Banks and financial services firms have to stand out in the crowd by offering customers something extra.

“The bottom line is there is nothing that can differentiate one bank from another, other than making a connection with customers,” says Joe Sullivan, CEO of Market Insights

. Sullivan’s company helps financial institutions with business strategy, planning and marketing. “Make an emotional connection with the consumer and let them know you understand their financial needs. Then come at them with solution-based thinking, not product pushing.”

The financial services providers that help customers take ownership of their finances and teach them to become better money managers will have larger client bases, says Sullivan.

In a rapidly changing world, financial services providers must be aware that their customers are changing, too.

Consumers are savvier and more aware of their finances than they were five years ago, according to Sullivan. The best providers engage customers and learn how their needs are evolving.

If a bank or a business has not looked at its market or its customers to learn “what is going on with them in the last year, you don’t know your customers.” Sullivan said.

The economic crisis that began in 2008 is still very fresh in customers’ minds. Large financial institutions collapsed and the government bailed out troubled banks. The stock market lost value and in much of the country the housing market eroded.

Now financial advisers are called on to provide factual evidence to customers that the economy is getting stronger.

“Technology has changed the expectations consumers and small businesses have of their bank,” Sullivan said.

Clients use information on the Internet to compare financial service firms. Many more customers are comfortable with managing their money online and they expect user-friendly tools to do so.

E-mail messaging and chat interaction may now be primary ways financial advisers communicate with clients. Companies must react to changes in technology to keep reaching customers in the most effective ways.

The financial services world is like high school in some ways: Reputations can be difficult to control or change. At the moment, consumers are not forgiving many of the companies that were front and center during the economic crisis.

And that is what we in the financial services industry have to do: 1. Expect – there to be obstacles and that you are no longer going to be able to do things as you have done them in the past. We all know that the five we listed at the beginning of this article (technology, compliance and regulation, interest rate environment, competition and the economy) are not going away, they are not going to stabilize and there is very little to almost nothing you can do about them or that. 2. Adjust – then adjust to your new environment. Stop giving energy (through whining and complaining or wishing it were different) to the obstacles and instead invest in identifying the challenges. Spend time with your team talking about what challenges or difficulties these obstacles have created for you and how they impact your current plan or strategy. 3. Create – then lastly create new opportunities and new ideas for reaching your end goal and achieving success. This is your competitive advantage. Once you stop trying to control or prevent what you cannot control or prevent, you will free up your mind, your creative juices, and come up with new plans and new strategies for achieving success.