In today's highly competitive banking environment, many participants in the financial services industry are feverishly positioning themselves to capture a larger share of the customer's wallet.

To this end, strategic partnerships are being developed that combine the financial strength, experience, and capabilities of business segments that have traditionally operated within their own area of expertise.

Perhaps one of the best examples that can be used to illustrate this concept is what we are seeing within the financial services industry, and in particular, financial institutions, insurance companies, and marketing companies.

Financial institutions enjoy the benefits of possessing a tremendous customer base. Surveys continue to show that customers generally trust their financial institutions and that a certain amount of loyalty remains so long as customers, can get the services they desire.

The insurance companies that banks work with bring expertise in financial products that are very unfamiliar to the banking industry.

Possessing the expertise on how to successfully market their services, these companies will be able to provide great assistance in marketing support. That also holds true for automation and technology, in which billions of doll s have been invested. The formation of these partnerships avoids duplication of those costs.

And last, but not least, is sales training. No other industry has invested more in sales training than the insurance industry. In forming partnerships, insurance companies bring prove sales training programs that can be customized to complement the banking environment.

Marketing organizations are made up of highly skilled individuals, many of whom have roots in the banking, insurance, and brokerage industries.

They provide expertise in areas that financial institutions and insurers may not particularly excel in or concentrate on -- namely consultative services, marketing strategies, due diligence, legal aspects, and compliance support.

So what are the primary reasons each industry is interested in forming partnerships?

Banks are looking to overcome the regulatory hurdles in delivering products and trying to gain quick entry into the alternative investment business while maximizing fee income with a minimum capital outlay.

They are also looking for expertise in products they are unfamiliar with, such as annuities, life insurance, and mutual funds. And they want to obtain marketing pertise from their partners.

Furthermore, banks can capitalize on the technology and sales tracking reporting these partners can provide. Banks also want to obtain administrative and customer service support, allowing them to provide a high level of service to their customers.

At the same time, insurance companies are seeking opportunities with financial institutions that will allow them to capitalize on the relationship the bank has. with its customers. Insurers want to be able to deliver products and services through a large customer base so that they can achieve cost savings.

Those savings can result in high-value products or even development of private label products which can be tailored to the needs of individual banks and their customers. Insurers also want to form partnerships with banks in order to exchange demographic information, which can provide unique marketing opportunities to specific customer segments.

The third-party marketer's primary reasons in forming partnerships are to share their high level of expertise on issues in which many banks and insurance companies do not specialize. Marketers' areas of expertise include technology, sales training courses, sales tracking, and marketing strategies, such as asset allocation and financial planning.

In many banks today, such partnerships work very well as long as each entity relies on the other.

When you or your third-party marketing firm select an insurance company, remember that you are selecting a long-term partner. Customers who buy insurance products through banks will probably own the products for years.

If you don't take the selection of a partner seriously, you'll be living with complaints about product features, liquidity, renewal rates, or customer service for a long time.

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