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Fans, Not Customers: How to Create Growth Companies, Part I

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Please don't take the following the wrong way. I love you bankers and I need you bankers for my business, but the conventional banking model is weakening the financial fabric of this country. The financial strength of your institutions is only as strong as the financial strength of your customer/fan base. You need to build a financially stronger consumer base to build a financially strong bank. We need to find new ways of doing old things.

Its a warm fuzzy idea; fans not customers, but fans don't pay the bills customers do. And fans don't always become customers. Customers become customers because of the value you bring to them, not how many pens they can walk out with. The entire banking industry needs to look in the mirror and be honest with itself. Your wants and needs are absolutely irrelevant in the eyes of the buying public. Your entire industry is built on the backs of the consumers you claim to serve, but you aren't serving their needs, you're serving your own. Quit flattering yourself; the public still thinks you're self serving and building your empires at their expense. If you don't believe me go sit in your lobby and ask them.

Consumers have real needs and its not a new checking account or a new loan. They need to get out of debt so they can do more with their hard earned income. They need you to step to the plate and help them become a stronger consumer. You need their deposits to support your model, but your demand accounts don't meet their need of getting more out of there income. HINT: Online banking does not equate to ROI for the depositor. Ask them.

Do you think a homeowner WANTS a mortgage? No, they want a home, but they need a mortgage to get the home. And the first thing they want and need after they buy the home, complete with 360 monthly payments, is to get rid of the mortgage, but banks don't offer that solution do they? But that is what your new customer needs. Why don't you teach them how to accomplish that goal and put them on a path to fulfilling all of their financial hopes, dreams and desires? If you can do that then you really have a fan and they will tell everyone they know to go to the bank that teaches them how to become a stronger consumer and not just another customer saddled with a long term debt that will keep them from accomplishing some of there other financial goals for years to come.

How do I know this 'serve their needs first' model works? Because I have generated over half a billion in loans since 2008, and I'm not even a banker or lender. Wake up banking industry before the public does. As soon as they figure out that you don't provide any real value they will stop being your customer...I mean fan.
Hang on to those pens, you might need to sell them to keep your doors open.
Posted by Bill Westrom | Wednesday, November 07 2012 at 12:44PM ET
Bankers will almost always find a way to ignore Vernon Hill's advice and impressive track record because they consider the regulator as more important and believe they have a divine right to their customers money rather than the need to earn it...any wonder there are truly few fans out there.

I disagree with his view on market research, because well defined market research can provide the basis for intuition about what's next. Its all a matter of what questions you're asking. A uniquely superior customer experience is always a winner! What is unfathomable is that so few grasp that fact and make it the essence of what they do.
Posted by Roy Henderson | Wednesday, November 07 2012 at 1:41PM ET
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