When asked at American Banker's most recent Best Practices in Retail Financial Services Conference to describe their strategic goals, executives of CDNow and barnesandnoble.com said essentially the same thing: building relationships with our customers, differentiating our service by one-to-one marketing, and creating value for customers while dealing with them from a distance.

Many of us are bound by the traditional view of relationships. The customer comes into the store and retailers provide customized service, such as calling them by name and offering products tailored to their needs.

CDNow, Barnes & Noble, and other Internet retailers are offering relationships at a distance, recognizing and serving people electronically, not face to face. The value to the customer comes from this recognition and customized product offerings that are based upon research of similar customers.

In addition to shattering the myth that relationships can only be built in person, that presentation provided other valuable lessons. Many traditional retailers are trying desperately to move customers away from stores to other forms of distribution in order to lower transaction costs. Internet retailers are doing just the opposite.

"Keep them at our sites as long as possible, let them browse and hang around," they say.

The reason is simple. On-line retailers have found that the longer people stay at a Web site, the more likely they are to buy. How did we forget that rule? Our branches are much like these Internet storefronts, so the longer customers stay to look at the merchandise or to speak with a salesperson, the more likely they are to buy.

The best salespeople will tell you that taking time with the customer is what generates profitable sales to a bank. We need to learn how better to differentiate between the need to lower transaction costs and to more fully realize our potential as retailers.

I was also stunned when the CDNow and Barnes & Noble people said that what customers look for when selecting an Internet site is "relationship and trust."

Isn't that what we're selling in our traditional offices? It appears that relationships and trust can be built independently of the channel the customer uses. Rather, they grow out of a strategic orientation.

For Barnes & Noble and many others, the value-added components go well beyond the size of the inventory. They include recommendations on other music or books, information on authors, frequent-flier miles, special pricing for loyal customers, and unique editorial content.

These retailers have found that differentiation by price alone is not effective, particularly on the Net, where prices are easily compared. Internet retailers are working to reinforce relationships through the power of the brand and mass customization.

The goal for an Internet marketer beyond relationships would be to build a better music store and get the customer to come in a second time-ideas fundamental to any retailing strategy and, again, not channel-specific.

We all know what the fundamentals of retailing are about, and we all seek flawless execution of them.

We want to serve customers in a way that creates more customer knowledge for us and greater benefits for the customers on their own terms.

Each customer visit, whether in person, by phone, or on-line, presents opportunities to sell profitable, value-added services that they may buy because they trust us and what our brand stands for, and because they have a relationship with us.

These truths are valid for a small bank or a large one, or an Internet retailer. All want the same thing: loyal, long-term customers who stay with us for reasons beyond pricing. Ms. Bird, an executive vice president at Wells Fargo Bank, is based in Sacramento, Calif.

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