Last week, we hosted the final installment in Vertical IQ’s free spring webinar series—a presentation entitled Building Prospecting Momentum, led by banking industry sales expert Ned Miller. Ned notes that banks can grow their book of business through effective prospecting, but it’s a competitive world out there when it comes to acquiring new business from commercial and small business banking clients.
There are an increasing number of non-bank alternatives for businesses when it comes to managing their finances, and more and more businesses are willing to give these non-banks a piece of their portfolio. However, according to Barlow Research, only 1 percent of small businesses changed their primary bank in the last year. This shows how tough it is to get people to switch banks! They need a compelling reason to change.
Nature versus nurture
Are the best prospectors “naturals,” Miller asks? Some experts say yes, the best salespeople have innate skills in persuasion and closing, but many others are self-made in their sales achievements. They have worked hard to learn which prospects to pursue and how to reach the decisionmaker.
Miller suggests several characteristics—combining mindset and skillset—that make a banker a great prospector such as discipline, patience, intelligent persistence, listening skills, managing emotions, and being an effective storyteller (sharing stories about a similar issue experienced by another client and how you solved it). He goes on to say that successful prospectors also:
- Know their market
- Focus on the right companies or niche
- Leverage team members
- Build a network and use it
- Manage themselves
What the best salespeople do differently
The progression of relationship development skills is Miller’s next focus, going through the four stages of evolution a salesperson can progress through. People in the more advanced stages of relationship development (stages 3 and 4) have several common behaviors. They:
- Use a focused and proactive lead generation process
- Use their existing network to get testimonial referrals and to meet targeted prospects
- See their role as the primary strategist for key relationships
- Build strategic relationships throughout the C-suite
- Effectively use business partners to strategize and develop key relationships
- Effectively use senior management to build vertical client relationships
There are also important ways that sales leaders can support and nurture these stellar salespeople in order to keep them, which Miller shares.
Why would a business switch banks?
Miller shows an interesting side-by-side about the actual reasons that businesses switch banks as compared to the reasons that bankers think they switch banks. Fees is at the top of both lists, yes, but there’s a striking difference when it comes to the second item on each list. For business owners, the second most common reason they switch banks (35 percent) is because they got a referral from another company. That reason is fifth on the list (19 percent) for reasons bankers think businesses switch.
So, the takeaway from this finding is that if you have good relationships with other clients in your prospect’s industry, this could be a big strategic advantage in winning the new prospect if you can implement effective tactics, like actively asking for referrals.
But while most business owners (66 percent) are happy to provide a referral if they are satisfied with their bank, few bankers take the initiative to ask for that referral. Only 22 percent of business owners say they’ve been asked for a referral in the past two years.
Finding your value proposition
Being a good prospector is not all about sales skills, however. To be successful, you also need to be adept with your credit insights, well-versed in your product knowledge, have a solid business acumen such as analyzing client data, and have the ability to strategically think about what is going on in the prospect’s industry.
You then must be able to tailor your message and conversation to speak to those challenges and opportunities that are impacting the prospect and their business. It’s about adding value to that prospect’s day-to-day grind of running their business. This requires doing your homework and planning.
This is also why Miller suggests finding a niche industry, which allows you to become an expert on a certain industry or business situation so you don’t have to do new research for every single prospect, which will save you time.
Miller concludes with three questions to ask yourself about your interactions with prospects:
- What insights/ideas can you offer that will help them produce better results?
- What ideas will provide them with a deeper understanding of the dissonance or challenges they are experiencing?
- What (beyond your product set) can you tell them that they don’t already know?
As Miller notes, a banker’s job isn’t to ask the prospect, “What’s keeping you up at night?” It’s to tell them what should be. And doing industry research (using Vertical IQ, of course!) can give you this exact information to share with your prospect.
To see a full replay of this webinar, please click here.