Iowa Bankers AssociationFebruary 6, 2020
©2020, HaberfeldPresented by Dr. Sean C. Payant 1
Dr. Sean C. PayantChief Consulting Officer
Thursday, February 6, 2020Des Moines, IA
The Growth Challenge:Strategies to Drive Results
A C C E L E R A T I N G G R O W T H
PURPOSEUnderstand what it will take to grow your
bank and succeed at the highest level
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Iowa Bankers AssociationFebruary 6, 2020
©2020, HaberfeldPresented by Dr. Sean C. Payant 2
A C C E L E R A T I N G G R O W T H
Some Background for Context
A C C E L E R A T I N G G R O W T H
Haberfeld Update
Rank No. Branches Institution Name
1 5,623 Wells Fargo Bank
2 5,080 JPMorgan Chase Bank
3 4,340 Bank of America
4 3,023 U.S. Bank
Real #5 2,463 Haberfeld Clients
5 2,428 PNC Bank
6 1,794 Branch Banking and Trust Company
7 1,457 Regions Bank
8 1,247 TD Bank
9 1,176 KeyBank
10 1,174 SunTrust Bank
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Iowa Bankers AssociationFebruary 6, 2020
©2020, HaberfeldPresented by Dr. Sean C. Payant 3
A C C E L E R A T I N G G R O W T H
It isn't what we don't know that gives us trouble…
Will Rogers
it's what we think we know that just ain't so.
A C C E L E R A T I N G G R O W T H
People
Products
Processes
Promotion
How is growth created?
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Iowa Bankers AssociationFebruary 6, 2020
©2020, HaberfeldPresented by Dr. Sean C. Payant 4
A C C E L E R A T I N G G R O W T H
People
Products
Processes
Promotion
How is growth created?
A C C E L E R A T I N G G R O W T H
Develop Your Bank’s People
1. Managers must be trained to lead, not just manage.
People
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Iowa Bankers AssociationFebruary 6, 2020
©2020, HaberfeldPresented by Dr. Sean C. Payant 5
A C C E L E R A T I N G G R O W T H
Not equipped with the
skills to lead.80%
People
A C C E L E R A T I N G G R O W T H
In-Branch Sales
Effective branch management is
the most important factor in success!
People
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Iowa Bankers AssociationFebruary 6, 2020
©2020, HaberfeldPresented by Dr. Sean C. Payant 6
A C C E L E R A T I N G G R O W T H
Case Study: Manager Impact
56.20%Increase
44.63%Increase
24.78%Increase
Branch 1 Branch 2 Branch 3
People
A C C E L E R A T I N G G R O W T H
Develop Your Bank’s People
1. Managers must be trained to lead, not just manage.
2. Implement on-going, weekly training initiatives.3. Increase engagement by creating internal value.4. Improve employee retention.5. Establish consistent customer engagement
practices.
People
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Iowa Bankers AssociationFebruary 6, 2020
©2020, HaberfeldPresented by Dr. Sean C. Payant 7
A C C E L E R A T I N G G R O W T H
A C C E L E R A T I N G G R O W T H
Develop Your Bank’s People
1. Managers must be trained to lead, not just manage.
2. Implement on-going, weekly training initiatives.3. Increase engagement by creating internal value.4. Improve employee retention.5. Establish consistent customer engagement
practices.
People
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Iowa Bankers AssociationFebruary 6, 2020
©2020, HaberfeldPresented by Dr. Sean C. Payant 8
A C C E L E R A T I N G G R O W T H
Create Value for EmployeesIn
ves
tme
nt
People
A C C E L E R A T I N G G R O W T H
Develop Your Bank’s People
1. Managers must be trained to lead, not just manage.
2. Implement on-going, weekly training initiatives.3. Increase engagement by creating internal value.4. Improve employee retention.5. Establish consistent customer engagement
practices.
People
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Iowa Bankers AssociationFebruary 6, 2020
©2020, HaberfeldPresented by Dr. Sean C. Payant 9
Up to 35% Turnover in the banking
industry.
People
A C C E L E R A T I N G G R O W T H
6-9Months of salary to replace.
People
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Iowa Bankers AssociationFebruary 6, 2020
©2020, HaberfeldPresented by Dr. Sean C. Payant 10
A C C E L E R A T I N G G R O W T H
What’s the price?
People
A C C E L E R A T I N G G R O W T H
Why turnover?
People
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Iowa Bankers AssociationFebruary 6, 2020
©2020, HaberfeldPresented by Dr. Sean C. Payant 11
50% of employees leave a job to get away from a boss
People
A C C E L E R A T I N G G R O W T H
Develop Your Bank’s People
1. Managers must be trained to lead, not just manage.
2. Implement on-going, weekly training initiatives.3. Increase engagement by creating internal value.4. Improve employee retention.5. Establish consistent customer engagement
practices.
People
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Iowa Bankers AssociationFebruary 6, 2020
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A C C E L E R A T I N G G R O W T H
Take the emotion out of the selection process when prospects come into your branches!
A C C E L E R A T I N G G R O W T H
People
Products
Processes
Promotion
How is growth created?
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Iowa Bankers AssociationFebruary 6, 2020
©2020, HaberfeldPresented by Dr. Sean C. Payant 13
A C C E L E R A T I N G G R O W T H
Have a Compelling Offer
• Confusing product – if your employees don’t understand it, your customers never will.
• Too many asterisks or too much fine print (i.e., what’s the catch?).
• Too many variables for the customer to consider.
Products
A C C E L E R A T I N G G R O W T H
Secret to Good Product
• Good for the customer
• Simple and logical
• Easy to sell and easier to buy
• Makes money for the bank
Products
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Iowa Bankers AssociationFebruary 6, 2020
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A C C E L E R A T I N G G R O W T H
Simple Accounts – Retail
Mystery shopping results indicate employees do betterwith a simple account menu:
• 44% better at recommending the best account for the consumer
• 21% better at closing the sale
• 23% shorter sales presentations
Products
Source: Haberfeld Research
A C C E L E R A T I N G G R O W T H
Retail Portfolio Cross-SellProduct Type Haberfeld Client Ratios Haberfeld Client Balances
Checking 1.575 $5,160
Savings 0.474 $7,272
Money Market 0.032 $70,453
CD 0.072 $28,958
IRA 0.026 $19,141
HSA 0.022 $2,709
Consumer Loan 0.078 $11,720
Line of Credit 0.022 $9,370
HELOC 0.035 $35,528
Mortgage 0.062 $128,672
Business Checking 0.110 $17,455
Total (Products) Relationships 2.508
Total Deposits $18,391
Total Loan Volume $10,341
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Iowa Bankers AssociationFebruary 6, 2020
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A C C E L E R A T I N G G R O W T H
Plus Services
Products Ratio
Products 2.508
Services
Debit Card 0.711
Bill Pay 0.137
Online Banking 0.573
Mobile Banking 0.348
eStatements 0.214
ACH 0.594
Direct Deposit 0.553
5.638
A C C E L E R A T I N G G R O W T H
Retail Account Economics
Retail Checking
1,651 Checking
1,542 Cross-Sell
$3,193 NPV*
*Over 9.14 years
Products
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Iowa Bankers AssociationFebruary 6, 2020
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A C C E L E R A T I N G G R O W T H
Simple Accounts – Business
• Do you have a free business checking account?– If yes, how free is it – 100 items, 150 items, 300
items?– If no, why not?
• Why complicate the process – here’s what the data shows. . .
Products
A C C E L E R A T I N G G R O W T H
Business Case Study New Accounts
Average Number of Transactions
Number of Accounts Percent of Total
0-50* 2,848 85.97%
51-200 386 11.65%
201-500 73 2.20%
500+ 6 0.18%
Total 3,313 100%
*55% of new accounts had fewer than 10 monthly transactions
Source: Haberfeld Research
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Iowa Bankers AssociationFebruary 6, 2020
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A C C E L E R A T I N G G R O W T H
Balances and Cross-Sell by Transactions
TransactionsAverage Number of
TransactionsAverage Balances Cross-Sell Relations
0-10 5 $4,301 3.47
11-25 18 $6,274 4.54
26-35 30 $6,249 4.53
36-50 45 $11,856 4.70
51-100 75 $13,011 4.70
101-150 125 $18,132 5.39
151-200 175 $18,288 5.39
201-300 250 $27,669 5.63
301-400 350 $37,392 6.97
401-500 450 $32,675 6.97
>500 550 $46,124 6.97
Source: Haberfeld Research
A C C E L E R A T I N G G R O W T H
Business Portfolio Cross-Sell
Cross-Sell Product Ratios RatioAverage Balance
Business Checking 1.521 $29,021
Business Savings 0.069 $17,702
Business Money Market 0.052 $126,743
Business CD 0.024 $77,214
Business Loan 0.206 $159,914
Business Line of Credit 0.039 $97,297
Business Mortgage 0.108 $462,427
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Iowa Bankers AssociationFebruary 6, 2020
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A C C E L E R A T I N G G R O W T H
And They Bring Their Retail Products Too…
Cross-Sell Product Ratios Ratio Average Balance
Checking 0.850 $10,793
Savings 0.377 $9,561
Money Market 0.058 $98,971
CD 0.080 $39,615
IRA 0.026 $18,114
HSA 0.032 $3,480
Consumer Loan 0.069 $18,844
Line of Credit 0.048 $3,067
HELOC 0.040 $43,382
Mortgage 0.093 $176,205
Total Relationships 3.692
A C C E L E R A T I N G G R O W T H
Generally Higher Retail Cross-Sell Balances
Retail Product All Retail CustomersBusiness Customers
with a Retail Account
Multiple
Checking $5,160 $10,793 2.09
Savings $7,272 $9,561 1.31
Money Market $70,453 $98,971 1.40
CD $28,958 $39,615 1.37
IRA $19,141 $18,114 0.95
HSA $2,709 $3,480 1.28
Consumer Loan $11,720 $18,844 1.61
Line of Credit $9,370 $3,067 0.33
HELOC $35,528 $43,382 1.22
Mortgage $128,672 $176,205 1.37
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Iowa Bankers AssociationFebruary 6, 2020
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A C C E L E R A T I N G G R O W T H
Business Account Economics
Business Checking
4,599 Checking
8,053 Cross-Sell
$12,652 NPV**Over 9.71 years
Products
A C C E L E R A T I N G G R O W T H
People
Products
Processes
Promotion
How is growth created?
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Iowa Bankers AssociationFebruary 6, 2020
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A C C E L E R A T I N G G R O W T H
Processes
Remove Barriers
• Do your policies create or remove barriers?“Does my spouse need to be here?”“What forms of ID do I need?”
• Do you pre-screen customers in order to qualify for an account?
A C C E L E R A T I N G G R O W T H
Account Screening – Client Data
Category Account Screening No Account Screening
OD/NSF Frequency 2.07 2.72
Principal Losses $4.66 $6.83
Account Screening Costs $7.51
Net Fee Revenue (after losses & costs)
+$25.12
Account Openings per Branch per year +21
Source: Haberfeld Research
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Iowa Bankers AssociationFebruary 6, 2020
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A C C E L E R A T I N G G R O W T H
Account Screening – Recent Case Study
Accounts Opened 202
Accounts still active 157 78%
Accounts with charge-off 21 10%
Flagged as “Would not have been opened with account screening.”
Fee Income Analysis – 7 Months
Gross OD Income $15,600
Debit Card Interchange $4,100
Charge off $4,612
Net Impact* $15,088
*Does not include savings from cessation of account screening inquiries.
Source: Haberfeld Research
A C C E L E R A T I N G G R O W T H
People
Products
Processes
Promotion
How is growth created?
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Iowa Bankers AssociationFebruary 6, 2020
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A C C E L E R A T I N G G R O W T H
Target Likely Prospects
Source: Haberfeld Research
Promotion
A C C E L E R A T I N G G R O W T H
Driving ResultsDemonstrated Convenience
Promotion
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Iowa Bankers AssociationFebruary 6, 2020
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A C C E L E R A T I N G G R O W T H
Driving Results
Demonstrated Convenience
• They live around or are businesses near your branches
• They are the neighbors of the customers you already have
Promotion
A C C E L E R A T I N G G R O W T H
Driving More Traffic: Demonstrated ConveniencePromotion
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Iowa Bankers AssociationFebruary 6, 2020
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A C C E L E R A T I N G G R O W T H
Driving ResultsPredicted Convenience
Promotion
A C C E L E R A T I N G G R O W T H
Driving Results
• They work around your branches
• They shop nearby or eat nearby your branches with regularity
• They walk by or drive by your branches
Predicted Convenience Through
Promotion
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Iowa Bankers AssociationFebruary 6, 2020
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A C C E L E R A T I N G G R O W T H
Integration of Big Data
(GPS based data points with some cell data)
150Million devices
150Activity
points per day
Trip frequency within 400 meters of
client branches
Promotion
A C C E L E R A T I N G G R O W T H
Driving More Traffic: Predicted ConveniencePromotion
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Iowa Bankers AssociationFebruary 6, 2020
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A C C E L E R A T I N G G R O W T H
Impac
t
Investment
Referrals
Traditional
TV & Radio
Newspaper
Billboard
Targeted Direct Mail
In-branchMarketing Traditional
vs.Digital
Channels
A C C E L E R A T I N G G R O W T H
Targeted Direct Mail Considerations
Addressed:Dear Neighbor
Promotion
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Iowa Bankers AssociationFebruary 6, 2020
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A C C E L E R A T I N G G R O W T H
Targeted Direct Mail Considerations
Convenience: Branch locations
Promotion
A C C E L E R A T I N G G R O W T H
Targeted Direct Mail Considerations
Compelling Offer: e.g., free
checking, rate, incentive
tiebreaker, etc.
Promotion
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Iowa Bankers AssociationFebruary 6, 2020
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A C C E L E R A T I N G G R O W T H
Targeted Direct Mail Considerations
Comparison:We are simply
better than the competition.
Promotion
A C C E L E R A T I N G G R O W T H
Impac
t
Investment
Referrals
Traditional
IP Targeting
TV & Radio
Newspaper
Billboard
Targeted Direct Mail
In-branchMarketing
Paid Social
SEM/PPC
SEM/Display
Mass Email
Digital
Traditional vs.
DigitalChannels
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Iowa Bankers AssociationFebruary 6, 2020
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A C C E L E R A T I N G G R O W T H
Digital Marketing
1 2
1 1Proactive Reactive
Promotion
A C C E L E R A T I N G G R O W T H
Flexibility of Digital Marketing
Source: Novantas© © The Financial Brand
Promotion
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Iowa Bankers AssociationFebruary 6, 2020
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A C C E L E R A T I N G G R O W T H
1
1Proactive
Targeted Display
Sum of EstimateOA Score
Mobile Predict Score 1 2 3 4 5 6 7 8 9 10 11 12 14
Grand Total
0 42,034 2,424 639 355 51 219 174 140 90 10 46,1361 17,827 3,726 800 22,3532 20,886 576 1,037 385 22,8843 17,664 1,961 1,304 393 969 322 395 23,0084 13,629 6,480 1,334 333 21,7765 11,394 4,783 2,813 414 404 481 485 379 21,1536 15,543 4,832 1,848 782 1,039 560 24,6047 16,186 2,799 1,031 1,121 600 862 22,5998 11,769 2,867 3,303 1,067 466 416 662 344 20,8949 15,876 2,823 2,138 478 606 21,92110 16,336 5,662 1,330 23,32811 12,862 7,787 377 391 629 22,04612 10,227 6,392 1,395 163 18,177
Grand Total 222,233 53,112 19,349 5,156 3,138 1,255 1,866 3,019 598 913 140 90 10 310,879
Audience Selection
A C C E L E R A T I N G G R O W T H
Display Ad Types
Brand-Focused
Promote a specific product in which you have an advantage
Product-Focused
Highlight a distinctive of your bank—what makes you special?
USP-Unique Selling
Proposition
Build awareness and name-recognitionProduct e.g., free checking, compelling rate offer
Brand Increase awareness of your institution, get you front-of-mind in your market
USPWhat makes you special? e.g., History in the market, local decision-making
Promotion
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Iowa Bankers AssociationFebruary 6, 2020
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A C C E L E R A T I N G G R O W T H
2
1Reactive
Search driven
Promotion
A C C E L E R A T I N G G R O W T H
Clicks directed to Landing Page
Clicks directed to your web site
Promotion
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Iowa Bankers AssociationFebruary 6, 2020
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A C C E L E R A T I N G G R O W T H
Advertising: Three Factors
1
Use the right media
2
Use the right frequency
3
Have the right message
All of this directed to the right audience!
Promotion
A C C E L E R A T I N G G R O W T H
Advertising Strategy
1. Use the right media
• Recommendation is highly targeted, data driven traditional and digital marketing channels based on your bank’s data and modeling
• Spend in rank order of ROI
• Continue to optimize frequently
Promotion
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Iowa Bankers AssociationFebruary 6, 2020
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A C C E L E R A T I N G G R O W T H
Advertising Strategy
2. Use the right frequency
• Every six to seven weeks
• Target “double-whammy” Fridays
Promotion
A C C E L E R A T I N G G R O W T H
Advertising Strategy
3. Have the right message
• Your Compelling offer:• What’s in it for consumers?• Why should they pick your bank?• What makes your bank different?
• When prospects are looking to make a change, you must give them a reason to choose you!
Promotion
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Iowa Bankers AssociationFebruary 6, 2020
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A C C E L E R A T I N G G R O W T H
Results
A C C E L E R A T I N G G R O W T H
Retail Checking Portfolio –Ten Locations
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Iowa Bankers AssociationFebruary 6, 2020
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A C C E L E R A T I N G G R O W T H
Retail Checking Deposit Growth –Ten Locations
A C C E L E R A T I N G G R O W T H
Business Checking Portfolio –Ten Locations
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Iowa Bankers AssociationFebruary 6, 2020
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A C C E L E R A T I N G G R O W T H
Business Checking Deposit Growth –Ten Locations
A C C E L E R A T I N G G R O W T H
People
Products
Processes
Promotion
The Key to Growth: Doing everything right all the time . . .
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Iowa Bankers AssociationFebruary 6, 2020
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Contact Me AnytimeSean C. Payant, Ph.D. | Chief Consulting Officer
402-323-3614 (Office)402-440-0947 (Cell)
Join us for an Encore Webinar:
Thursday, February 27, 20201:00 – 2:00 PM CST
https://www.haberfeld.com/encore-webinar
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