This is the final article in a three-part series on serving small business credit union members. In part one, we explored the lucrative potential of serving small businesses and helped you organize your approach to acquiring small business members. In part two, we discussed how to build a member business base and then deliver the right mix of products and services to it.
Gain A Larger Share of Wallet
As mentioned in part two, tracking and understanding the types and numbers of accounts and transactions your business members use will provide the valuable market research you need to cross-sell and up-sell a host of products and services from loans and investments to online services. Pay attention to patterns that tell you a business member might benefit from a specific product. For example, a business that writes a large number of paper checks would probably benefit from ACH services.
Businesses demand top functionality across several platforms. Create bundled packages of products and services and market them accordingly. This will demonstrate your understanding of the business member’s needs and help build member loyalty. This approach can also help increase fee-based revenues and reduce in-branch costs for the financial institution.
Products to consider bundling include:
- Seamless money movement: online bill pay, book transfers
- Full integration of financial management software and online banking services like Quicken or QuickBooks
- Direct deposit capabilities
- Real time online wire transfer services
- ACH: batch-oriented electric funds transfer
- Check image viewing
- Remote check depositing
Businesses are interested in the value you can provide to them. Position your products and services accordingly. Your marketing message should emphasize the benefits of consolidation, convenience, simplification, ease of use, and ─ most importantly ─ how small business members can gain more time, greater productivity and growth opportunities. 1
Attain and Incorporate Member Feedback
Feedback is critical to planning for new or enhanced products and services. Whether through live focus groups or online surveys, asking for input will help guide product direction and rolling out the right new products. Be sure to show you are listening by:
- Reviewing existing business products and services
- Discussing potential new business products and services
- Learning about current challenges facing business members
- Tuning in to new issues. Your member’s needs might be changing as his or her business grows and your products and services must remain relevant.
Expand Your Footprint
Expanding the geographic reach of your financial institution is an important growth opportunity. Assess which members – business and retail – have multiple locations and speak to their multi-location and remote service needs.
Maximizing the online banking channel is an obvious solution to expanding physical reach. Two important products include:
- Remote Deposit Image Capture - This service enables business members to scan the front and back of checks at their place of business and transmit the electronic images over the Internet for processing by their credit union via secure and convenient connections. Remote Deposit can help improve member convenience while reducing courier and transportation costs, making funds available faster, and improving money movement through automation. According to Celent, financial institutions that are launching remote capture today will win customers away from those who are not. In fact, over the next 12 months, between $150 and $200 million in commercial deposits will migrate to financial institutions that offer it 2 – significant, considering that fewer then 50 banks in the U.S. supported remote deposit capture in 2005.
- Automated Payroll Solution - Offering self-service payroll services that can be integrated with online cash management or used as a stand-alone platform is another means to expanding your footprint. Small businesses get convenience and control while reducing the risk of tax penalties. Meanwhile, the financial institution can benefit from the higher deposit balances per business account, further bolstered by the fact that tax dollars are typically not impounded on paydays.
In summary, to tap the lucrative small business potential facing credit unions today, it’s important to educate your relationship managers about the powerful potential of this membership and how your credit union can help manage these members’ entire financial lifecycle. Map out ways to find out what’s missing or needs improvement by simply asking your business members about their needs. And emphasize your online products – they spur retention and bring in more revenue. Take pride in offering best of breed technology: not only does it decrease your own in-branch service costs, it’s a progressive way to handle the ever-growing dependence on the online channel.
1. Small Business Market Survey, Aite Group, June 2006
2. Remote Capture: The New Frontier in Cash Management, Celent Communications, May 2005, p. 4