Jeff Judy

Jeff's Thoughts - February 18, 2009

Invest Time in Educating Your Business Customers Now!

Banks vary quite a bit in their approach to financial literacy, in their commitment and approach to making sure their customers are equipped to make the best financial decisions for themselves and for their businesses.

Some institutions take little interest. Financial literacy is the customer's problem, they feel. (There may even be a few that think the less the customer knows, the better for the bank, but that is a view I strongly oppose.)

Others think educated customers are a good idea, easier to work with and more likely to be successful. But rather than invest their own time into education, they hand out a few standard brochures, or perhaps encourage customers to visit websites that address this issue.

Still, some truly embrace the value of wiser customers, investing their own time into developing financial literacy among those customers. I encourage the bankers I train to think about "EEC": ensuring that their customers have realistic Expectations, that they get the financial Education they need to manage their businesses better, and that the banker maintains the kind of ongoing Communication that heads off ugly surprises.

"Education" can mean offering seminars in the community to bring people up to speed. But mostly it means that individual bankers both thoroughly answer questions customers have and offer explanations of questions the customers should have but don't know enough to ask. They take advantage of "teachable moments" that come up in their interactions with customers, and most of all, they give their time, they are patient with their customers when it takes a little more effort to show them how things work.

If you think that spending time educating customers is a "luxury" or "nice-to-have," something that you can't afford in the current downturn, think again. Sure, many customers could have done a better job of listening to the lessons you may have offered in the past, but that doesn't change the basic rules of the game, as I see them:

In my own work with business owners, I have seen just how eagerly they want to understand how their bankers think, and how grateful they are for patient, straightforward explanations of how we do business. Banks that spend time with their customers now, when times are tough, will find that those customers return the favor when conditions improve.

Making customer education a strategy and a value of your bank, instead of a necessary evil, allows you to do a better job with much greater efficiency than just letting it happen at random as customers demand it. Make that commitment now, even as you scramble to respond to all the urgencies of our current conditions, and you will lay the foundation to build loyalty and gain market share when conditions improve.