In his blog post titled The Power of Location-Based Offers in Financial Services, Jim Marous, Co-Publisher of The
Financial Brand, highlights how banks can leverage the proliferation of smartphones to make location based offers for cross-selling of banking and other third-party products at their branches.
Let’s say a bank implements LBOs and an existing checking account customer (“Jane Doe”) of the bank receives a PUSH notification for a special deal on a credit card on her smartphone when she’s walking past its branch. Since she happens to be in the market
for a credit credit, the offer is relevant. Since she’s in the branch's neighborhood, she walks in to find out more.
I was in a similar situation recently, just that my bank’s offer for a new loan product came via email. It wasn’t very relevant at the time. Therefore, I forgot about it until I'd to visit the branch a couple of weeks later to
- Withdraw cash from my company’s account for petty cash expenses (unlike personal account, there’s a lot of friction in applying for an ATM card for a corporate account, so I hadn't bothered to do so; besides, who thought cash would still be around, right?:))
- Update my passbook (I don’t like e-statements, my bank doesn’t like paper statements, so I use the passbook option)
- Collect a booklet for depositing cheques (landlords collect house rents from their tenants via Post Dated Cheques issued in advance for the total duration of the lease period viz. 24 months; since I haven’t yet found an electronic payment option to replace
PDCs, I need to fill out a pay in slip to deposit my tenant’s PDC every month).
As soon as I entered the branch, a bank staff waylaid me and asked me, “Have you done your tax planning?” For the uninitiated, many investment products qualify for tax rebates. Since March 31 is the last date for buying these products and filing tax returns
for claiming these rebates, CQ1 is the peak period for sale of these products at bank branches. Knowing the full import of this question, I said “Yes”, and tried to move on. But this lady wouldn’t let me go. She went on and on with “Have you heard of this
product, have you thought of that product, blah blah blah”. I finally had to shoo her away by saying, “Let me finish what I’ve come for, then I’ll listen to whatever you’ve to say”. Reluctantly, she let me go.
I spent the next 10 minutes on the teller queue. When I reached the customer inquiry counter, the guy who updates passbooks was missing. He returned to his post after
20 minutes. It took another 10 minutes to get the pay-in slip booklet. When I finished, there was no sign of this formerly pesky lady. I left the branch without finding out about the new loan product. I can bet that Jane Doe would've gone through a similar
The bank lost potential sales from its LBOs.
Which is a shame.
Sales is arguably the sole raison d'être for banks to continue with their branch networks in today's world where customers are increasingly turning to digital channels for conducting mundane transactions like balance inquiry, statement download, and so on.
More in my earlier blog post titled Secret Of Survival Of Bank Branches.
So, it's a no-brainer that banks should do something to prevent such incidents from happening.
Question is, what can they do?
Is technology the answer? Or is it something else?
Let me go back to my visit and imagine an alternative scenario in which the branch staff
- Offers to help with my purpose for visiting her branch
- Gets me to the head of the teller queue (which happens automatically in another bank when I simply flash my so-called "Fast Forward" card)
- Brings the AWOL passbook updating person back to his seat
- Fetches the pay-in slip booklet from the so-called "collateral cupboard".
If she does this, I won't shoo her away. Instead
- I’ll be grateful to her for saving my time and energy
- I'll be in a more conducive state of mind for listening to her spiel about tax saving products on offer
- Who knows, I might even buy the loan product I'd come to inquire about!
Going by this experience, banks can boost their in-branch sales by training their branch staff to change their selling approach. Some amount of technology - paging system to locate missing staff members and mobile shelving systems to store and retrieve collaterals
- can also help.