Two million bogus accounts, 5,300 fired employees, over half a million faked credit card applications, $185 million in fines from the Consumer Financial Protection Bureau, a $5 million restitution tab, a CEO resignation and projected business losses that total in the hundreds of billions of dollars for years to come — a scandal the scope of the Wells Fargo fiasco is certain to affect the entire banking industry.
Given the nature of the scandal, it’s easy to understand why some inside (and outside) the industry say pressure to cross-sell inspired Wells Fargo employees to take illegal and unethical actions. How will your organization respond to the shock wave the scandal has sent through the industry? Will your financial institution reassess your sales policies and practices to ensure they promote ethical employee behaviors? Or will you go a step further and abandon cross-selling altogether?
Blaming the infractions solely on sales culture is likely too simplistic and abandoning cross-selling altogether is impractical, reactionary and short-sighted. Organizations with sales cultures similar to Wells Fargo’s may well consider the megabank’s current situation to be a wake-up call. However, for most in the industry, the situation can serve as more of a reminder that there’s always an opportunity to improve sales practices in a way that will benefit both customers and the financial institution.
The value of cross-selling
Sales are the lifeblood of all businesses, including financial institutions. Cross-selling new products and services to existing account-holders can enrich the bank-customer relationship and increase profitability — for far lower costs than those associated with acquiring totally new customers. Successful cross-selling allows financial institutions to maximize the value of each customer while introducing existing customers to products and services they might be unaware of or didn’t know they needed.
Fear of the potential for abuse shouldn’t keep banks from effective cross-selling. Rather, it’s even more critically important that you cross-sell wisely in a way that emphasizes the value of the activity for customers. Consultative selling puts the needs of customers first, a tactic that promotes ethical selling and ensures greater value for customers.
The ethical sales culture you want
Providing staff with quality products and services to sell and incentivizing them to do so, is only part of the equation that adds up to a successful, ethical sales culture. Sales training should emphasize the primacy of customer needs; teach staff how to identify each customer’s pain points and then suggest solutions that address the customer’s specific needs, situations, and opportunities. The monetary value of the bank of securing the sale must be secondary to the financial and lifestyle value the product or service can bring to the customer.
It’s also critical for salespeople to be upfront about pricing. Transparency builds and enhances trust. Being honest and upfront about the price of proposed products and services gives sales people an opportunity to educate customers about the value of the offering — and help them understand why the product is worth the cost.
Cross-selling tactics that work
We’ve talked a lot in the past about the importance of effective onboarding as part of the cross-selling process. Cross-selling is most successful when it occurs between a financial institution and an already engaged customer. Engagement must be established and solidified during the early days of the bank-customer relationship. Once that occurs, the customer is more likely to be receptive to cross-selling and more trustful of the products and services being recommended.
There is no one-size-fits-all approach to cross-selling; each customer’s preferred communications mode will be as unique as his or her needs. Still, certain factors are common:
- Static information is less than useless for many of today’s consumers. They don’t want to just read a brochure. They want fast, interactive information presented via their preferred channel of communication.
- Consultative salespeople — persistent, but not pushy, informative without being aggressive — are far preferred.
- Information presented digitally, whether through videos, email newsletters or informative websites, allows customers to quickly consume and more easily digest complex financial information about new products and services.
- Trigger-based communication and cross-selling help ensure sales messages are relevant and welcome. For example, newlyweds may be more receptive to information about mortgages, while customers in their 50s may crave additional information on retirement accounts.
Cross-selling is a valuable tool for building profits and enriching customer-bank relationships. As long as cross-selling occurs in an ethical, customer-focused manner, financial institutions should not fear a competitive, goal-driven sales culture.