3 cross selling of banking products and financial services

CROSS SELLINGOF BANKING PRODUCTS & FINANCIAL SERVICES -by Gazal Badlani Ashok Sarkar PGDM 2010-12 Trimester – 4... • Research statistics demonstrate that the average customer uses less t

CROSS SELLING

OF

BANKING PRODUCTS & FINANCIAL SERVICES

-by Gazal Badlani Ashok Sarkar PGDM 2010-12 Trimester – 4

Scope of cross selling

• Liability side

• Asset side

Examples of cross selling

1 Credit insurance

2 Life insurance enhancements to traditional

mortgages

3 Auto and homeowners insurance

4 Medical savings accounts

5 Asset management accounts

• Research statistics demonstrate that the

average customer uses less than two services from any one depository institution

• Seventy percent of all customers share their banking needs with more than one financial institution

• Sales call tracking

• MIS systems (activity management, information)

7 - steps

Marketing facets

7 times expense

 Strong commitment to customer care at all levels

 Promises made must be realistic and achievable

 Intimate knowledge of the customer leads to excellent customer service

 Continuous feed back from the customers

7 steps approach

Cross selling & Relationship Banking

• The emphasis here is on viewing the customer as a long term business relationship

• Banks plan to meet the total banking requirement of the customers and expect repeat business

• Relationship is based on full knowledge about the customer needs and causing total customer satisfaction by providing services that exceeds his expectation

• An understanding of exactly what the customer is buying in critical The basic utility he derives from the product is the nucleus of core in the

center, surrounded by services of both tangible and intangible attributes

7 steps model of relationship banking

7 step model approach

1 On super - ordinate goal: Draw the vision and mission

statements around the customer value

2 Strategy - Draw a strategy of market segmentation to focus on a

customer

3 On structure - Restructure the organization as a cross functional and

process oriented one

4 System - Design a service delivery system on quality and coordination

5 On skill - Cultivate skill as cutting edge

6 On style - Devise a suitable appraisal system and reinforce it through

7 steps model of personal selling

1 Prospecting & qualifying

2 Pre-approach (deciding the best approach)

3 Approach (ability to observe and listen)

Bundling

Cross selling process

Buying cycle

NPTB modeling

The challenge of cross selling is to know which product to sell to which customer

NPTB modeling

A next product to buy modeling promises to enhance the effectiveness of cross selling by specifying which product to sell to which

customer

NPTB approach

1 Compiling data

2 Selecting statistical method

3 Estimation and evaluation

4 Scoring and targeting approach

1 Develop a true dialogue with each customer

2 Knowing the ins and outs of the product

offerings

3 Propose appropriate solutions

4 Capture data and share it across enterprise

5 Create incentives around effective cross

selling

6 Recognize all opportunities for cross selling

Bottom line & Implementation

The biggest difference between "merely

effective" and "high performing" cross-selling in financial services is the degree to which the high performers invest the time to really understand customers' needs

• The banker as a consultant

• Who owns the client

• Dislodging a satisfied client

Thank You