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People, Not Prices, Win Business

One of the things I appreciate about being able to speak to banking groups of various management levels is getting to bounce things off them. I'm always curious to observe which statements and themes strike nerves with people.

In a speech to a branch manager group a few weeks ago, I highlighted one of the newer branch designs and strategies announced by a competitor bank. I sensed that a few folks in the room were just a little surprised to see a competitor's branch up on the screen. And some likely grew a little uneasy when I expressed that I thought that particular competitor had been making some pretty smart moves lately.

My mind immediately flashed to something I've half-joked with bank managers about many times in the past: I have a problem with folks who are far better at telling you why you shouldn't do business with their competition than in telling you why you should do business with theirs.

"We're not as bad as the other guys" is not exactly a compelling value proposition.

I smiled at the group and told them, "You know, we all need to remember sometimes that the bankers we compete against every day are also smart people. They wake up early and work hard to support their families, too."

I'm not often surprised by a group's reaction, but I was just a little in that instance. Instead of seeing folks bristle at hearing that their competition is hardworking and smart, there was almost total unanimity in their reactions. Folks smiled and leaned forward. Many glanced at each other, nodded their heads, and said things like "You better believe it."

In that instance, a re-realization came to me. Our teams tend to engage when they are reminded that their competition isn't buildings or technology or marketing campaigns or brands. The competition is other smart people who have most of the same opportunities and challenges that they do.

Sensing that this group would appreciate the story, I went on to offer that certain coaching sessions can stick with you for a couple of decades or more. And while the banking industry of today is considerably different than the one I joined twenty years ago, some words from the first bank president I worked for still resonate with me.

While sitting in one of our weekly branch manager meetings early in my career, a member of the marketing department distributed the results of their latest "rates shop". When the report was handed out, there was audible grumbling about the fact that our bank was in the middle-of-the-pack on loan interest rates and near the bottom of the list on what we were paying on deposits.

One of my peers made the mistake of saying, "Well, they're going to eat our lunch this month" loud enough for our bank president to hear.

In a tone that was actually less sardonic than I had heard before, he chuckled and said, "Okay, hang on. Are you telling me that the only way we can beat the competition is if we charge the least and pay the most?"

After letting that hang in the air for a moment, he said, "If that's the case, why the heck are we letting you guys run things? I can hire anyone off of the street to sell on price."

As the normal sycophants who were complaining only moments earlier tried to change their tune, he continued, "If all you can do is compete on price, you are at the mercy of your dumbest or most desperate competitors. Should we just let them dictate our business to us?"

He finished the thought with, "If what we bring to customers is not worth at least a little more than the other guys, we're apparently not running the kind of bank I thought we were."

That message has stayed with me all of these years. Sometimes you'll have the best rates. Often, you won't. Sometimes you've got the absolute latest technology and newest branches. Often, you won't.

There are things folks working on the frontlines and their direct support staff can control today and things they cannot. Yes, the list of things we cannot control may be longer. But the list of things we can control is far more important.

As changing technologies and customer expectations seemingly push our industry toward commoditization, we need to remind ourselves and our teams that some things remain true. People are attracted to and tend to remain loyal to bankers and businesses they know, like and trust.

Whether or not we fit that description is entirely up to us and what we choose to wake up each morning and get to work on. And folks who are reminded of how much that – and they – matter tend to stay more engaged.

What is your team focused on and working towards today?

Dave Martin is an executive vice president and chief development officer at Financial Supermarkets Inc., a Market Contractors subsidiary that offers design, construction, consulting and training services for retail banking programs. He can be reached at


(7) Comments



Comments (7)
This reminds me of the adage "you get what you pay for". My community experienced a massive hailstorm that left nearly every home on the block in need of new roofs and windows. Several neighbors remarked at how quickly our home was inspected and repaired and our insurance check arrived. We discovered these neighbors had discount insurance companies that weren't even calling them back regarding their claims. I would rather pay a higher premium for better service and I suspect our neighbors were regretting their low-cost option. Provide a valuable customer service experience and price will not be what makes or breaks a sale. Whether insurance or banking, it's best to adopt tools such as a multichannel cross-sell solution or focus on price optimization rather than being a low-cost provider. Combined with effective customer service this will create a competitive edge for banks beyond pricing.
Posted by Karen Gordon | Friday, August 02 2013 at 10:41AM ET
"If what we bring to customers is not worth at least a little more than the other guys, we're apparently not running the kind of bank I thought we were." This is exactly the phrase that most Bankers - including Community Bank executives - ought to be focused on. What does your Bank bring to the table that the 50, 100 or more competitors do not? And please don't say friendly service... because no one believes this, even if it is true. And please don't say local decision making... because this only matters if your Bank approves more deals and does so much faster than the competition... and we know this is not the case.

So, what does your Bank bring to the table that is not available from the competition? Some will say it is the value of the Banking officer. Perhaps, but Barlow Research survey shows that 94% of Small Businesses do not follow their Banker when (s)he moves to a different institution (

The only way for Banks to differentiate their services is through a comprehensive Business Strategy that delivers extraordinary value to customers while generating Revenue growth and exceptional ROE (
Posted by Serge Milman | Thursday, August 01 2013 at 12:31PM ET
Very basic but still true.
Very easily forgotten.
Very hard to have it consistently realized across the sales team.

Thanks for reminding
Posted by huntimc | Wednesday, July 31 2013 at 2:18PM ET
It appears to me that the point here is not that there is some simple prescription for success. Neither is it that every banker has the competencies to become a trusted financial advisor. The point is that financial professionals will always be needed as long as people need money they don't yet have; have money they don't yet need; want payments made simply as possible; and want accounting and documentation for all their financial matters. Not every person who works at a bank has the credibility, reliability, intimacy, and interest in mutual success to be worthy of trust. But, those who do must position themselves to be ready, willing, and able to help when the inevitable need arises. Then price will only be one of the factors in the customers' decision rather than the driving factor. 402-699-9509
Posted by Neil Stanley | Wednesday, July 31 2013 at 2:10PM ET
Agreed-but at a major money center bank the people come and go so frequently the small to medium sized customer really has several people each year to deal with. this premise holds more water in rural America than it does in a major city.

yet if your pricing and service "suck" then your ability to retain this customer declines.

allen hardester
Posted by hardester | Wednesday, July 31 2013 at 1:53PM ET
"People are attracted to and tend to remain loyal to bankers and businesses they know, like and trust." Agreed, although the big question is, how to get known, liked, and trusted in a digital banking environment with few, if any, person-to-person interactions.
Posted by Devonk | Wednesday, July 31 2013 at 1:49PM ET
Dave, your well-told story highlights the issue that every banker needs to address today. For these very reasons we have developed and refined the process, products, and tools to consultatively sell bank product that arguably could be the most commoditized - Time Deposits.

If we can de-commoditize CDs where we respect that every depositor wants 1)High Yield and 2)Short Commitment; every financial service can be expressed in value that goes beyond price alone. Yes it takes some effort to understand the customer and their situation to make a consultative sale. But, if bankers don't add value through their professional engagement, why wouldn't every customer simply shop for commodities based only on price? There is more to value than price. Anyone who invests quality time with customers will learn the lessons you offer here. Bravo! 402-699-9509
Posted by Neil Stanley | Wednesday, July 31 2013 at 1:47PM ET
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