Retaining Commercial Bank Customers Made Easy
Commercial Bankers are in a unique situation. They have the opportunity to provide much-needed solutions to people and businesses that are in great need of them. Their deep understanding of the banking system and financial statements provides them the opportunity to be valued consultants to their prospects and customers.
A commercial loan is a typical end game, but that’s not where the customer finds the greatest value. A recent research project that I was involved in supports the notion that professional service providers don’t understand what their customers value. They assume the value is tied up in the quality of their primary offering (in this case, money). But, the relationship with who delivers that service, how it is delivered and the expertise that accompanies it is what B2B customers desire. In bank terms: it’s not the loan, it’s the expertise that you provide and how we got to the loan that really matter. When the relationship is transactional and is reduced to a commodity (money), it loses value. If your bank approves the loan, other banks will too. So, a bank doesn’t get a lot of credit for approving a business loan and should provide other value in order to retain the customer.
A commercial banker can only be a good consultant if they know the business that they are working with. They might know the industry well, but that’s just a conversation starter. You can’t provide solutions if you don’t know the specific challenges the business is facing. This may seem like a lot more work for the banker, but the B2B customer has pretty easy expectations to meet. They’d simply like an occasional check-in and an annual conversation about the company (not just a financial review). The customer wants you to know them so that you can help them
I’ve been critical of the ‘relationship marketing’ strategy that commercial banking embraces so tightly. And still, I think it’s an antiquated strategy to acquire commercial banking customers. But in 2024, a proactive working relationship is certainly the way that you retain them because that’s what the customer values most.