To remain competitive, the
parameters of differentiated
service must be defined and
operationalized, and must be
Most banks already have a differentiated version
Service is defined as “the act of helping or doing work for someone.” Within such a broad definition, many institutions have
already developed their own parameters for “higher levels of
customer service,” whether explicit or implicit. Each institution’s
employees and history influence these
parameters. As a result, many institutions
likely already have the basis for a differentiated service-based positioning—they just
may not have specifically designed their
business models to support it and may
not have communicated this difference
effectively to their customers.
To remain competitive, the parameters
of differentiated service must be defined
and operationalized, and must be continually monitored and enhanced as competitors in the banking industry are quick to
copy compelling value propositions. The
key to creating a differentiated service-based brand positioning
is to find the “white space”—the specific needs of your customers that are not being met well by the competition and create
the means of executing within that white space that delivers
an experience that will resonate strongly with your customers.
What makes your bank unique today?
Each of our 7,000 community banks has a customer focus, history, employee base and set of financial goals that are different
from the rest. All 7,000 institutions, therefore, have a wealth of
information at their disposal to help them uncover who they
are today—and who they would like to be in the future.
Identifying those aspects that make your bank unique depends
on finding the answers to three simple questions:
m;Who are your customers and what motivates them?
m;Who are your employees and how do they feel about your
m;With whom do you compete and what are they delivering
Let’s review each of these questions separately.
Who are your customers?
“To be relevant, you have to start with the customers you have
and the customers you wish you could attract,” says Angela Ross,
chief branding officer at StellarOne Bank (assets: $2.9 billion)
of Christiansburg, Va. Understand the types of customers the
bank has, the types of customers it will need to serve to reach
the bank’s financial goals, and what all groups of customers
need and want from their bank.
This is important, because “excellent service,” when all is said
and done, is defined by a set of preferred behaviors that will vary
greatly across customer segments. For example, businesses have a
different definition of “service” than consumers; among business
customers, different individuals (owners, executives) and different
industries (medical, manufacturing, professional, government,
nonprofit and so forth) also have varied takes on the idea. “Banking
is personal,” says Nancy Benben, an independent brand consultant.
“Customers like to feel special and known. Providing good service
requires that you demonstrate to the customers that you know
them and you know how they want to be treated.”
At the former NewAlliance Bank (assets: $8.4 billion) of
New Haven, Conn., (now part of First Niagara Financial Group
of Buffalo, N. Y.), Benben took what she refers to as a “360-de-
gree approach” to determine what would resonate with both
consumer and business customers. The bank conducted focus
group research to find out “the why’s, the attitudes, and the
behaviors” that led both customers and prospects to choose a
bank, then leveraged this knowledge to build a strong brand
Who are your employees?
In addition to understanding customers, banks must gain a better
understanding of their employees. This means all employees of
the bank, from the board members and the C-suite personnel
down to lenders and branch staff. How do they describe the
bank? What type of collective personality do they have? What
are they already doing today to deliver good service and what
could they be doing differently?
Part of NewAlliance Bank’s “360-degree approach” included
one-on-one interviews with directors and key executives, as well
as small group discussions with employees at various levels. If
employees do not participate in building the brand strategy,
or even worse, do not believe in the positioning, the strategy is
doomed. Employees must become brand ambassadors—and
you need to know how close or far away you are from this goal
and create a game plan for making it happen.
With whom do you compete?
Now it is time to turn your attention to the external environment. All banks, of course, must compete with others
for both new customers and for more business with existing
customers. Identify those with whom you compete directly,
then take a hard look at what each company tells customers
it will do for them.
“What are the belief points for other institutions that
compete on service? You should be able to identify things that
they are or are not doing,” says Ross. “Is there something the
customer wants that he/she is not getting elsewhere?” Once
you locate the gaps in competitor value propositions, you
can better understand how your bank’s strengths may help
it to fill those gaps.
Putting It into practice
Together, these analyses will point toward a credible, differentiated positioning strategy that revolves around customer service.
Common themes will emerge from the exercise to point you in
the direction of a new, more specific, service-based positioning.
Your analysis should also reveal what the bank is doing today
that is in-line with that definition and is different from competitors, and what the bank has to change to more completely