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MARKETING TO BANK CUSTOMERS: Life Events
Capturing money in motion during customer life events
Michael P. Sullivan
Fifty-Plus Communications Consulting
Why do large amounts of money move? It’s because something happens in bank customers’ lives that allows bankers and financial advisers to add assets and deepen customer relationships. Almost three-quarters of consumers who seek financial advice do so because of a major life event, according to surveys done by Tiburon Research, a financial services researcher.
Life events are triggers for bank customers’ financial needs. Events like births, weddings, a new grandchild, graduations and retirement move money. So do not-so-joyous events like family illness, death, job loss, business failure and family breakup.
Research shows that customers average one life event per household per year, more than twice that number for those in their 50s and even more for affluent families, who have more complex lives. The business is there.
Major life events put money into motion, causing baby boomer and older customers to seek investment and financial information and advice. But often, those same customers don’t even think about their banks, because in their minds, banks and life events don’t go together.
They are too busy living those life events. They frequently do not have the knowledge or experience to see through the events to their financial implications. Consequently, financial decisions get made by default or by accident. Banks that have relationships with the customers may never have an opportunity to capture the financial transactions, because the customers don’t ask about it, and the institutions don’t know about it.
Bank associates need to systematically mine life events to create and add assets and gain new customers. Doing so positions bank associates to be able to say, “We are the financial advisers who specialize in helping customers with important life events.” You and your associates will learn how to generate more sales from customers, families and friends.
Consider an example that occurs virtually every day in every branch: A customer gets a promotion and a pay increase. The customer may save the money or spend it. If the money is saved, the customer may choose to do business with your bank — or go somewhere else. If the money is spent, it may be used to pay for the financing of a new car, a boat, home remodeling or some other item that a bank could finance. The customer may choose to do business with you — or go somewhere else.
Regardless of what decision the customer makes, the bank has no ability to influence in any direct one-to-one fashion.
The problem is obvious: The bank does not know about the promotion and the pay increase and, therefore, must rely on the customer to initiate an inquiry. It is a passive, order-taking approach to sales. It depends on marketing communications’ ability to penetrate the customer’s consciousness that the bank should be in consideration for a vast array of different types of decisions. And a vast array of different types of competitors, from auto dealers to Merrill Lynch, are also vying for the customer’s consciousness.
It should not be surprising, therefore, that most institutions miss most life event opportunities with their own customers. There are too many different money-moving life events — about 40 of them; too many different possible financial decisions, including spending alternatives; too many different products and services; and too many competitors of all types also clamoring for attention.
What can you do to help your bank get more business from life events? I will discuss some ways in my next column.
For your own list of these many life events, send me an email at
Mps50plus @aol.com.
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