Advocacy is the key to sales

Until the member wins, the credit union doesn’t win.

Six years ago, a now $16 billion bank began to acquire nearly 75 branches in the Western U.S. from one of the nation’s largest banks. Initially, there was a lot of deposit runoff (25 percent), which was accounted for in the purchase price. Once the transaction dust settled, nearly half of the acquired accounts were gone, but deposits were up 25 percent. The bank’s CEO and his team concluded that the lost accounts were zero or low-balance accounts, part of a past culture that compensated bank employees on the number of accounts opened.

Recently, the bank’s CEO opined on this dynamic in The Wall Street Journal. “Our philosophy is to do what is best for the client. If they need a new account, then open it; but, if they have too many accounts, it’s OK to close them and get to the mix of services the customer desires.” Doing what’s best for the customer—or member—and what he desires as a governing principle for a business model. Sound familiar?

Sales is a fascinating phenomenon in credit unions. We want members to buy, but we don’t want to pressure the sale. We want to deepen relationships (measured by added products), but we don’t want to overwhelm members with a never-ending cross-sell. We want to pull members to a better deal, but not push so much that they leave. So, what’s a credit union to do? Advocate for the member.


continue reading »