Banks Can Use Market Analytics to Help the Front Line Sell

Mary E. Shacklett, President, Transworld Data | 11/7/2011 | 19 comments

Mary E. Shacklett
It’s great to move to automated tellers and a combination of mail and email promotions, but in the end, banks will still elect to maintain tellers in some of their facilities and customer agents in their call centers.

One of these people's responsibilities is to work directly with customers. In this age of anticipatory marketing, this means that tellers and customer agents have to be able to understand the needs of the customers they are working with -- and to present customers with appropriate offers before the customers even realize themselves that they should be asking for them.

For financial institutions, this move to front-line selling hasn’t been easy. This is because the people who traditionally staff the teller lines in branches have been operationally oriented with a natural aversion to selling. The same can be said for many of the folks who end up in the call centers, frequently moving there from positions in back-office functions that have little or no customer contact.

Banks have tried to combat this selling aversion problem by strategically hiring people out of the retail sector (instead of banking) and then training them in banking positions. However, then the risk increases in other areas of banking -- like security and regulatory awareness, which is essential to anyone working in the industry.

Banks have also redesigned salary and incentive programs, so that those tellers and customer agents who sell really well can see their earnings go up based upon commission income -- but this same group traditionally tends to be conservative and prefers to know what their paycheck is going to look like at the end of every month instead of wagering part of it on the uncertain world of commissions.

Part of the solution for this dilemma for both the business and its supporting technology is a “smart” analytics system capable of providing those on the front lines who are most likely to interact with customers with an “on the spot” snapshot of the customer they are dealing with, and what that customer is most likely to be in the market for.

How does it work?

Marketing begins by using a server-based system that is “seeded” with an extract of its customer data from its primary banking system. Using a series of analytics questions and reports, Marketing then develops segments of the bank’s customers that might be grouped by age, geography, buying habits, credit worthiness, or other pertinent criteria. Central to this customer segmentation process is Marketing’s ability to ask the right analytics questions of the software so that the customer segmentation is effective.

Once customers are segmented based upon Marketing’s business rules and guidelines, the customers in effect are placed into certain “lifecycle” categories that are linked to the bank’s products that they are most likely to be interested in. Those 55 and over might be targeted for annuities or financial planning services. Those in the 25- to 35-year-old range might be targeted for home mortgage loans.

Once customer segmentation and profiling is complete, IT integrates the analytics and profiling results with the frontline teller transaction system. The result is that when 55-year-old Sam Johnson steps up to the teller window to deposit a check, the teller keys in Sam’s account number and immediately sees on the screen display that Sam has an excellent credit rating and might be a good person to approach about financial planning services or an annuity.

Of course, the process isn’t quite as easy as that. Tellers and customer agents still get a knot in their throats when they are compelled to “sell.” To ease this discomfort, banks over the past few years have invested in sales training and the use of these customer profiling systems to help their frontline personnel.

The message for financial institutions trying to understand how they can use analytics to make good things happen operationally is that a system with a specific value (furnishing important sales lead data) that is inserted into the right place in the operational workflow (where the agent or teller faces the customer) is easily understood and accepted because those being asked to use it can also see its value. When the business value is apparent, it makes it easier for staff to make transitions into the new and unfamiliar roles they are now being asked to perform.

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Mary E. Shacklett   Banks Can Use Market Analytics to Help the Front Line Sell   11/11/2011 3:32:14 PM
Re: it's about servicing not just selling
...and at least in my area of the country, there appears to be major fallout.
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Cyrus   Banks Can Use Market Analytics to Help the Front Line Sell   11/9/2011 11:01:27 PM
Re: it's about servicing not just selling
I hope you're right, Mary. There doesn't seem to be much of either coming from most commercial banks these days.
Mary E. Shacklett   Banks Can Use Market Analytics to Help the Front Line Sell   11/9/2011 3:31:52 PM
Re: it's about servicing not just selling
Whoever provides top service and great prices  will win the game, Cyrus.
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Cyrus   Banks Can Use Market Analytics to Help the Front Line Sell   11/9/2011 1:31:01 PM
Re: it's about servicing not just selling
@Mary I think the real winners will be banks like Ally (the rebranded GMAC Bank) who can offer people all the services they expect from a bank, including an ATM network with refunded fees, as well as a full variety of products. Credit unions are, unfortunately, too fragmented in geography to offer people who live in major population centers a real alternative.
Cyrus   Banks Can Use Market Analytics to Help the Front Line Sell   11/9/2011 1:26:14 PM
Re: it's about servicing not just selling
@David I've got nothing against tellers -- except I don't really need them. I'm not one who advocates for getting rid of them, because I know older individuals and others appreciate the help they provide. What I don't understand is why they don't reward me for the fact that my business can be served by them at a much lower cost?

One of the central problems we seem to have in America these days is wanting to punish everyone unilaterally instead of rewarding people for proactive behavior. My bank account costs my institution less to serve because I never make a paper deposit, do all my banking online and only write 2 checks a month at the most. Yet, they want to group me in with all the other "consumers" who make up a low-margin segment of the business.

I don't actually want anyone to sell me anything at a bank. Banks should be in the information business, as much as in the selling business. They should inform me about products/services that benefit me and stop trying to sell so much. They violate many classic tenets of the client service relationship.

Same with health care. It drives me nuts that we don't punish (for the lack of a better way to put it) people who live less healthy lifestyles and essentially punish those who are healthier and more active by making them subsidize bad behavior.
nimanthad   Banks Can Use Market Analytics to Help the Front Line Sell   11/8/2011 10:32:40 PM
Re: Mixed skill sets...
Yes a good option but you have to be vey accuate on it if not it will give a diffeent pictue and I have seen real life examples of failiures
Mary E. Shacklett   Banks Can Use Market Analytics to Help the Front Line Sell   11/8/2011 2:59:44 PM
Re: Mixed skill sets...
All great points, Damian.

More execs could profit from "in the trenches" experiences--and frontline analytics only does what a person who truly knows his customers already knows.
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Damian Romano   Banks Can Use Market Analytics to Help the Front Line Sell   11/8/2011 2:32:16 PM
Re: Mixed skill sets...
@Mary - The fact of the matter isn't so much analytics as it is people. Sure it's easier to sell when you have a portfolio-esq view of the person's financial situation, but general customer service skill coupled with good relationship skills is really all you need. If you take the time to get to know your customers and know the products/services well enough, sales comes almost naturally.

You don't find many who've been in the branches (trenches) end up in the executive roles. If you did, you might find a more successful bank.
Mary E. Shacklett   Banks Can Use Market Analytics to Help the Front Line Sell   11/8/2011 2:26:00 PM
Re: Banks and the Problem of Execution
Some banks do have the "desk," Gigi--but many still do depend on the front line to present offers.

Others have (as you described) a portfolio manager seated in a sequestered area of the local branch.
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Mary E. Shacklett   Banks Can Use Market Analytics to Help the Front Line Sell   11/8/2011 2:23:38 PM
Re: Mixed skill sets...
I agree, Damian.

I spent about 8 years in banking, and  found the same.

Many of the managers (and executives) are operationally oriented, and need to be taught sales themselves!!

Frontline selling will continue to present challenges for banks.
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