Small and midsize businesses (SMBs) account for the vast majority of companies in the U.S. This includes 39% of private sector payroll — $3.2 trillion — and 38.9% of private sector receipts or $14.6 trillion. This makes them a robust profit segment for regional banks and credit unions, and in a recent survey, 35% of SMBs said they would consider changing banks. They just need a compelling reason.
Many banks and credit unions currently view account holders from inside the institution, focusing on what packages they can offer instead of on what people want. That’s why homepages invariably feature the financial institution’s attributes and standard products, making much of the industry seem identical. So, if you’re a regional bank or credit union trying to make existing SMB relationships more profitable or cultivate new ones, you need to shift your approach.
We’ve developed a framework for success built on four areas of consideration: strategic analysis, program definition, organizational readiness and a go-to-market plan. Here is an abbreviated explanation of how each contributes to strengthening a bank or credit union’s overall SMB strategy.
Strategic Analysis
Strategic analysis begins by looking outside the financial institution and asking what the market wants and needs. What are the existing account holders and the target customers saying? What do competitors have? It’s not about what products or features are already being offered, how packages can be put together or building something new. It’s about taking a view of everything that is outside and planning how best to address the unique needs of current and prospective SMB account holders.
Program Definition
The program definition comes from inside, but at this stage the financial institution is simply drawing a roadmap of next steps. Too often people ask what can be built in the next 12 weeks to release next quarter but don’t spend enough time asking what the world will look like in three years, and what should be built to deliver what that future will demand.
The other important aspect is the value statements you want account holders to say after every interaction they have with you, and that could take place at any touchpoint: in the branch, on the phone or on the website. If the value statement is “They really understand what I want,” the communication strategy should look at what that means to different SMBs because it may not be the same thing. Next, imagine scenarios that incorporate this sentiment into a day in the life of a business owner in different segments. It’s tying back to those value statements and putting them together in a program targeting the person rather than promoting the product.
For example, your positive pay service meant to prevent fraud isn’t better than your competitor’s. They’re the same. So, focus on how this can benefit a specific business with messages like, “You didn’t create a dentist office to run a business. You wanted to help people. Why don’t you focus on that, and we’ll provide you the services, so you don’t have to worry about the business side.”
Organizational Readiness
Your teams, from communications and operations to customer service, should be ready to go from day one. Normally, outbound considerations like communications and understanding the customer’s perspective get lost in favor of drafting responses to potential phone calls and questions. A better idea would be to preemptively troubleshoot, so that there are no reasons for phone calls in the first place.
Go-to-Market Strategy
Now put your plan into action, launching your products with awareness campaigns that generate interest. Again, lead from the account holder’s perspective. Rather than making claims about what the products offer, focus on the value for the SMB.
The best way to differentiate your bank or credit union from your competitors is to demonstrate that you understand your SMB customers’ needs and have built products to address those needs.
