Rick DeLotto here. I have been hearing a lot of chatter recently that the “increased wallet share” model is breaking down as customers limit themselves to one FDIC-insured account per bank per family, rather than the maximum… unless their confidence in the banking system as a whole is utterly shaken they will be looking for another bank to put it in.
This looks like a prime time to gather up customers at a very low cost of acquisition. Make sure your touch-points have:
- Staffing available sufficient to withstand a surge from a sudden influx of business from former customers of competitors. This means maintaining proper relief cycles, adequate supervision and an air-of “business as usual” that keeps staff voices and demeanors calm and relaxed in the face of frantic customers. Keep in mind that business accounts might be jumping first.
- Prepared and practiced scripts explaining FDIC insurance, including how many accounts can be opened under protection, the level of the protection offered, and maybe even what customers should expect when the FDIC closes an institution down..
- Escalation plans in place to put the customer in immediate touch with persons who can explain the bank’s condition.
Some formal planning here might go a long way toward your bank being able to make lemonade out of someone else’ lemons.
2 responses so far ↓
1 Stessa Cohen // Sep 24, 2008 at 7:35 pm
If they are going to staff branches properly, then banks are going to need better ways to manage staffing costs. Is eyeballing branch operations a good way to do that? I don’t think so. Managing staff costs is going to be crucial to profitability and on-going operational efficiencies.
2 Rick DeLotto // Sep 25, 2008 at 8:31 am
Stessa–
I think this could best be seen as the need to have surge capability–bluntly, runs don’t give advance warning and rarely take very long to subside. The extra capacity might only be needed for 48 hours, but the opportunity vanishes just as quickly as it appears. Costs might not be high—it could be as simple as having ALL branch staff cross trained and certified as tellers, of having a back-up (maybe outsourced) call center handy.
Profitability comes later– gotta catch them first.
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