A Marketing Tool Wins Followers

San Diego Trust's System Building a Track Record

An aggressive marketing program first used by San Diego Trust and Savings Bank has improved product cross-selling and increased core deposits at more than 32 financial institutions nationwide.

The success rate has motivated a number of other institutions to install the sales system. They include Valley Bank of Nevada, Las Vegas; Suffolk County National Bank, Riverhead, N.Y.; and First Trust Bank, Ontario, Calif. And others are following, San Diego Trust said.

Through a combination of sales-staff training and computer-based incentive systems, San Diego Trust raised the average number of bank products used by its customers from 1.1 in 1981 to 2.7 this year.

Gordon Dames, president and chief executive officer of San Diego County Credit Union in California, said his institution "has seen significant, measurable results since implementing the program. Our service quality, member account relationships, and net income have increased substantially."

Payback Put at 18 Months

The program from San Diego Trust -- known as Success -- costs between $21,000 and $49,000, depending on the size of the institution, for all software, hardware, and related training expenses. Bankers put the payback time for the system at about 18 months.

The sales system focuses on training bank tellers and platform officers to cultivate customer relationships that result in expanded banking relationships. A personal computer-based software package tracks the ups and downs of sales figures and calculates incentive bonuses for tellers and platform employees.

Training lasts about 10 working days for branch officers and about one-and-a-half working days for tellers. Under the program, tellers do not directly cross-sell products. Instead, they are trained to recognize sales opportunities and refer the customer to someone who is knowledgeable about the products.

If the product is sold, the teller receives a referral fee, and the salesperson and his or her superior get a commission.

Incentive programs and training exercises for salespeople are nothing new to the banking industry. But officials at the banks using Success said the program differs from other cross-selling efforts in that it helps banks to avoid alienating its customers by trying to sell them unnecessary products.

Under Success, each platform worker is required to make five service-related calls a day to bank customers. The telephone calls -- are designed to sell the bank itself, not a bank product.

"If you convince a customer to buy a product he doesn't need, you may make a short-term gain, but you're not doing your overall relationship any good," said W.H. Steffen, a first vice president at San Diego Trust. "Selling bank products like they are cars is not the answer." [Graph Omitted]

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