4 minutes
Most sales cultures are broken and out of step with members. Here’s a more member-friendly approach.
The unravelling of Wells Fargo’s sales culture is causing ripples throughout the bank and credit union industries.
Bad press about the bank’s sales practices makes some credit union execs fear credit unions could be painted with the same broad brush.
The boards from some of our credit union clients have asked their CEOs to ensure their sales training, incentives and other sales practices don’t get them into the same quandary.
What Does it Mean for CUs?
You may feel removed from this sales debacle at a Goliath bank like Wells. You may be thinking, “We just don’t do heavy cross-selling like Wells.”
But assuming your credit union has invested in a sales culture with the conventional cross-selling model focused on transactional selling, you may be at risk of becoming a commodity and losing business from members who no longer visit your branches.
We feel confident in making that statement because in our work with both banks and credit unions, we’ve observed that many sales cultures are broken and rely on outdated sales training and practices that date back to the 1980s and are out of step with today’s consumers.
Very often we hear credit union execs say, “We need to get back to our roots.”
The good news is there’s an approach to generating sales revenue that’s better for members and more in line with your credit union’s values.
It removes the focus from transactions and products and places it squarely on getting to know members and positioning the credit union as their trusted financial partner in every life stage.
Myth: If Selling Leads to Revenue, Sales Training Must Be a Good Thing
Well, not all sales training.
Look, we know you need to generate sales and your staff needs to cross-sell. Cross-selling is not inherently bad.
However, the Wells Fargo debacle is the result of a problem that’s been brewing for 25 years or more in both banks and credit unions.
Over the years, we’ve seen sales cultures morph into a catalog of bad selling habits, ill-conceived incentive programs and sales goals that take credit unions dangerously close to antagonizing and even repelling members.
At the root of the problem is sales training designed to focus your staff on getting a product sale rather than getting to know the member first.
The dilemma with this type of training is that many times member service reps can be so focused on selling products that they skip the questions that would enable them to get to learn about a member’s broader needs for a lifetime of business.
Instead, they jump on the first cue they hear and ask questions to zero in on a specific product.
They proceed to engage in transactional conversations about products instead of engaging in relationship-building conversation about the member’s dreams, goals and aspirations.
The MSR makes a short-term sale but neglects to develop a trusting relationship that would lead to multiple sales from that member in the future.
That’s what conventional sales training teaches. It focuses on transactional product selling, which is very tactical and generates mostly short-term sales from mostly “not so loyal” members who view you as a commodity.
They may or may not seek your advice for more significant, future financial needs. Your credit union becomes just another errand.
Redefine How You Generate Sales: Be a Financial Partner, Not a Sales Person
Instead of just trying to sell, sell, sell, credit unions need to do a better job of listening to understand the member’s financial anxieties and dreams, building a trust relationship and searching for opportunities to improve members’ financial health.
Out of this relationship-building approach, sales will materialize. It’s what consumers say they want (according to Gallup).
This approach requires a change of mindset.
Rather than asking, “How many products can we sell our members?” staff needs to embrace such member-centric questions as: “How can we improve the financial well-being of our members?” and “What don’t we know about this member?”
Get Back to Your Roots: Focus on Advising and Educating
To get back to their roots and core values, credit unions need to stop the focus on selling and start advising and educating.
Rather than looking at a member as a short-term transaction, position your credit union as a trusted financial partner in all your members’ important life events.
The results can be impressive. When members observe their financial health improving based on suggestions from your MSRs, they become loyal advocates and will call you first when significant financial needs come up. This is how you grow a credit union organically! (See “Financial Wellness—Are You Missing a Growth Opportunity”.)
To get to this point requires creating a relationship-building culture instead of a conventional sales culture.
Instead of simply pitching products, staff uses relationship-building skills that incorporate cross-selling but at a higher level.
Credit unions that don’t re-evaluate the way they generate sales revenue may be doomed to relying on decreasing branch traffic and increasingly unprofitable transaction business instead of organic revenue from loyal members with whom the credit union has a genuine relationship built on trust.
Bob Romano and Barbara Sanfilippo are co-founders of High Definition Banking®, a national consulting, training and motivational speaking firm that partners with credit unions to increase sales, deepen member relationships and turn members into loyal advocates.
