People, Not Prices, Win Business

One of the things I appreciate about being able to speak to banking groups of various management levels is getting to bounce things off them. I'm always curious to observe which statements and themes strike nerves with people.

In a speech to a branch manager group a few weeks ago, I highlighted one of the newer branch designs and strategies announced by a competitor bank. I sensed that a few folks in the room were just a little surprised to see a competitor's branch up on the screen. And some likely grew a little uneasy when I expressed that I thought that particular competitor had been making some pretty smart moves lately.

My mind immediately flashed to something I've half-joked with bank managers about many times in the past: I have a problem with folks who are far better at telling you why you shouldn't do business with their competition than in telling you why you should do business with theirs.

"We're not as bad as the other guys" is not exactly a compelling value proposition.

I smiled at the group and told them, "You know, we all need to remember sometimes that the bankers we compete against every day are also smart people. They wake up early and work hard to support their families, too."

I'm not often surprised by a group's reaction, but I was just a little in that instance. Instead of seeing folks bristle at hearing that their competition is hardworking and smart, there was almost total unanimity in their reactions. Folks smiled and leaned forward. Many glanced at each other, nodded their heads, and said things like "You better believe it."

In that instance, a re-realization came to me. Our teams tend to engage when they are reminded that their competition isn't buildings or technology or marketing campaigns or brands. The competition is other smart people who have most of the same opportunities and challenges that they do.

Sensing that this group would appreciate the story, I went on to offer that certain coaching sessions can stick with you for a couple of decades or more. And while the banking industry of today is considerably different than the one I joined twenty years ago, some words from the first bank president I worked for still resonate with me.

While sitting in one of our weekly branch manager meetings early in my career, a member of the marketing department distributed the results of their latest "rates shop". When the report was handed out, there was audible grumbling about the fact that our bank was in the middle-of-the-pack on loan interest rates and near the bottom of the list on what we were paying on deposits.

One of my peers made the mistake of saying, "Well, they're going to eat our lunch this month" loud enough for our bank president to hear.

In a tone that was actually less sardonic than I had heard before, he chuckled and said, "Okay, hang on. Are you telling me that the only way we can beat the competition is if we charge the least and pay the most?"

After letting that hang in the air for a moment, he said, "If that's the case, why the heck are we letting you guys run things? I can hire anyone off of the street to sell on price."

As the normal sycophants who were complaining only moments earlier tried to change their tune, he continued, "If all you can do is compete on price, you are at the mercy of your dumbest or most desperate competitors. Should we just let them dictate our business to us?"

He finished the thought with, "If what we bring to customers is not worth at least a little more than the other guys, we're apparently not running the kind of bank I thought we were."

That message has stayed with me all of these years. Sometimes you'll have the best rates. Often, you won't. Sometimes you've got the absolute latest technology and newest branches. Often, you won't.

There are things folks working on the frontlines and their direct support staff can control today and things they cannot. Yes, the list of things we cannot control may be longer. But the list of things we can control is far more important.

As changing technologies and customer expectations seemingly push our industry toward commoditization, we need to remind ourselves and our teams that some things remain true. People are attracted to and tend to remain loyal to bankers and businesses they know, like and trust.

Whether or not we fit that description is entirely up to us and what we choose to wake up each morning and get to work on. And folks who are reminded of how much that – and they – matter tend to stay more engaged.

What is your team focused on and working towards today?

Dave Martin is an executive vice president and chief development officer at Financial Supermarkets Inc., a Market Contractors subsidiary that offers design, construction, consulting and training services for retail banking programs. He can be reached at dmartin@supermarketbank.com.