In today’s competitive environment, it’s important for banks to maintain and grow customer relationships in order to sustain profitable growth. But as banks continue to attract new customers through acquisition, existing customer churn undermines this growth. “Churn” refers to both the percentage of customers who end their relation with a bank and customers who still…
Category Archives: Customer Retention
It’s been long recognized that checking accounts are the workhorse of retail banking and create the best opportunities for other relationships to develop between the bank and its customers—check cards, bill pay, and the like. At any given time, 16 to 26 percent of the population is seeking a new checking account. However, your bank’s…
One of the sure signs of a bad or declining relationship is the absences of complaints from the customer,” reports Harvard professor Theodore Levitt. “Nobody is ever that satisfied, especially not over an extended period of time. The customer is either not being candid or is not being contacted.” If you’re not getting customer complaints,…
The banking industry continues to change at an unprecedented pace and is being confronted constantly with new challenges. According to the 2010 ABA Bank Marketing Survey Report banks listed regulatory changes (39.9 percent) and growth and retention (22.9 percent) as the biggest marketing challenges they will face in the next 12 months. The latest regulatory…
I’ve said it before, and it bears repeating: The best way to distinguish your bank from the competition is by creating value. For most any bank, “value” means offering competitive products and services. But it’s important to note that creating value isn’t about simply lowering the price on your core products or services. Actually, competing…
With the perception of banks at an all-time low, a successful customer retention strategy requires frequent contact, a consistent message, education and trust — thus becoming not only a cross-selling strategy, but also a relationship-selling strategy. Relationship-selling is a fundamentally different way of thinking about your customers. It’s based on a philosophy that business should…
With increased competition and saturated markets, banks are seen as interchangeable commodities. In commoditized situations, customers are easily swayed to leave by the free offers and special rates being offered by competitors. Banks that can identify, create, and maintain a sustainable differential value advantage will be less vulnerable to competitive pressures. Therefore, one key to…
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