According to a new Javelin Strategy and Research report issued today, many banks are not leveraging the insight available early in a new relationship to develop customized offers and to utilize preferred channels of communication. In their study entitled, "2010 New Account Onboarding: Using a Systematic, Tactical Approach to Deepen Financial Customer Relationships", the importance of collecting key pieces of information such as age, income and the customer's previous banking experience is emphasized. With this baseline insight, Javelin proposes that communication channel determination and messaging can be improved, thereby leading to improved engagement, retention and cross-sell results.
The findings in the robust 44 page study are a refinement of a previous Javelin onboarding study from 1997 and are consistent with what I have found visiting and speaking with banks across the country. In fact, two of my clients (Zions Bank and KeyBank) are referenced in the study.
Both banks initially communicate with all new account openers, focusing on the engagement process, with an emphasis on online banking and bill pay, debit card utilization, direct deposit and more recently autosave and overdraft protection (in response to Reg. E). In addition, both banks leverage multiple channels for communication, including email, direct mail and either centralized or branch-based phone calling. At both institutions, segmentation of the customer base and the process of customized messaging and cross-selling is done "after "the more overarching process of getting the customer familiar with and engaged with their service. The collection of transaction history provides the foundation for leveraging propensity models to drive cross-selling later in the relationship.
While the Javelin study (which was based on research collected online) indicates that consumers prefer to receive email communication regarding their new account, research done with the majority of my clients show that results are enhanced when multiple communication channels are utilized (even for online account openers). These findings are "not" inconsistent, but reflect the online banking focus of the Javelin research. In fact, by leveraging personalized jump pages, online banking messaging, help/switch lines and even statement messaging and inserts, results can be further enhanced.
Additional recommendations from the Javelin research include establishing a paperless relationship at account opening and during onboarding (many banks I work with are building marketing programs around this objective) and collecting mobile phone numbers.
In conversations with Mark Schwanhausser, Senior Multi-Channel Financial Service Analyst for Javelin in the development of this report, he found it amazing that banks were not focusing on the collection of mobile numbers as part of the account opening process due to the significant number of households making their mobile phone their primary communication media and the increasing preference of data distribution via mobile channels (alerts). The collection of email addresses should also be a required component of the new account opening process even though many banks still do not leverage this channel effectively.
While an emphasis on a strong onboarding/welcome process seems to be universal throughout the industry, there are dozens, if not hundreds of ways to implement such as process when you take into account messaging, timing, channels, target audiences, etc. I am interested in onboarding success stories and additional insights you can share. Feel free to leave a comment or learnings on my blog.
Author: Martha Rice In the competitive world of business, companies may decide to forgo leadership training in order to cut costs. However, a high-quality Leadership Development course can save six figures off a companys bottom line each year. Not only does a company need to vie for its share of todays market to keep itself profitable and successful, but it must also compete to keep its biggest investment, its employees. In a recent Bureau of Labor Statistics Report, the United States Department of Labor stated that the median tenure of employees ages 25 to 34 was 2.9 years. They also reported that management and professional occupations, with the highest median tenure among major occupational groups, was only 5.0 years. Consider then, the cost of employee turnover. A company should calculate the replacement of an employee at 150% of the employees annual total compensation figure, and 250% if the employee is in a managerial or sales position. This figure includes lost productivity, training, recruitment, temporary replacements, either through hiring temporary staff or overtime incurred by other employees, and the actual cost of an employee leaving. Simply put, if your companys average employee compensation package is 50,000 then the average cost for the loss of an employee is approximately 75,000. Consider also that if your company maintains a workforce of 1000 people and a yearly turnover rate of 7%, then your annual turnover expenditure will be approximately 525,000 a year. Over a period of 5 years, this figure can easily top two and half million. (To see a break down of costs see our employee turnover.) Wouldnt companies be better off using this money in developing leadership and innovative ideas to stay ahead of the competition? The answer will be a resounding yes. So how does a company keep its quality employees? A first step would be to discover what an employee feels is important in his or her job. CMOE surveyed 327 employees about their supervisors (117) before these supervisors attended a Leadership Development Course. The survey asked employees to give their opinions about what their supervisors were doing right; and in what areas could their supervisors improve. Twelve companies and agencies participated in these survey evaluations, representing the fields of banking, education, government, manufacturing, and sales. The data showed that employees want to be engaged, trusted, and responsible for their contributions. They also want to share in the emotional benefits of being linked with a growing and successful business. Good leadership is the key to fulfilling these employee needs. Another step is to put in place a team of leaders who have the skills to inspire a commitment from their employees to accept responsibility for and have a vested interest in their company and co-workers. Unfortunately, too many managers have knowledge about good leadership skills and still do not understand how to put this knowledge to work in the most effective manner. Training professionals can help these managers develop their knowledge into successful skills. An experienced leadership training company can also help companies develop an effective Leadership Development Course specific to a companys needs. The result will add dollars to the bottom line by keeping valuable employees, increasing productivity, and creating an environment conducive to innovation that will keep the business ahead of its competition. The Center for Management and Organization Effectiveness can help you develop effective leaders through our Leadership Development Courses such as: Applied Strategic Thinking, Coaching Skills, Team Building, and Transition into Leadership. About the author: Martha Rice is a design team leader for the Center for Management and Organization Effectiveness. She has degrees in both English and Communication and has over twenty five years experience in administration. If you would like to learn more about any of these or other Leadership Development Courses, please contact a represent
