Pub. 7 2018 Issue 7

l e a d i n g a d v o c a t e f o r t h e b a n k i n g i n d u s t r y i n k a n s a s 24 could attract about 10% more of the younger market segment than represented in a footprint. Our belief is you can attract younger segments, and win their loyalty, with an omni-channel approach, a core relationship and low-cost deposit acquisition strategy and a simple desire to grow. Myth #2: The branch is dead The branch isn’t dead nor have digital channels failed to meet customer’s expectations; customers simply want choices. According to the Celent study, customers prefer the branch for more complex relationship-based activities, but handle simple, more transaction based activities online. Overall, fewer than 10% of customers prefer only digital. This is right in line with what we’ve discovered at Haberfeld. For 73% of customers, the first product is the checking account. Over the last few years we have tracked online and in-branch opening stats at more than 300 community FI branches. In this sample of more than 500,000 core relationships, at institutions allowing account openings online, 95% of new relationships were started in-branch. Channels as well as choices are important! Myth #3: To gain core deposits, you need to offer a higher rate Higher rates get more deposits but is that the best way to grow? Attracting rate-sensitive customers is a risky approach in today’s rising-rate environment. Data from community based financial institutions representing more than 2,500 branches in the U.S. shows you can grow core deposits even without a rate. Few of these 2,500 branches offered an above market rate, yet grew core deposits at twice the industry pace. The key to sustainable core deposit growth, for core relationships as well as time deposit money, is a balanced strategy that includes a good sales process. Achim Griesel is president at Haberfeld, a data-driven consulting firm specializing in core relationships, customer, and profitability growth for community-based financial institutions. Mr. Griesel can be reached at agriesel@haberfeld. com or 402-323-3793. SHATTERED MYTHS OF BANKING By: Achim Griesel B anking has more customer data than about any other industry. We know financial and personal information and how customers spend money. With data, we can understand behavior patterns for millions of people. As bankers, we go to conferences and look for the next silver bullet but ignore what happens in our own customer base. We love buzz words, and talk about Big Data, machine learning, and AI but base our conclusions on personal opinions or small surveys while we have access to data, actual transactions, and behavior patterns for millions. To disregard this verifiable data in favor of notions we think we understand that eventually allows myths, like the five below, a place in decision-making is made. That can be detrimental to a community financial institution. How do you spot these myths and what should you do? Read on. Myth #1: For Millennials and Gen Z, digital is the only thing that matters A Celent study, recently posted to The Financial Brand, showed that Millennials and Generation Z adopted online and mobile banking at a higher rate than older customers but had a clear preference for visiting branches for some transactions – just as much as the older segment. That seems to explain in part a recent analysis showing that in the last five years, Google searches for physical bank locations doubled. To all generations, it seems, the branch is still essential. To attract younger customers, you need a balanced acquisition strategy and good solutions in-branch and online. It’s true for delivery as well as marketing channels. Data from more than 2,500 branches of community-based financial institutions shows a multi-channel approach that To attract younger customers, you need a balanced acquisition strategy and good solutions in-branch and online. To read the rest of this article: http://thenewslinkgroup.com/clients/KBA- Shattered-Myths/