Everywhere you look, the internet is changing the way businesses do business.
The record stores have long since closed their doors; most movie rental stores, like Blockbuster, have gone or are going out of business; and now book stores like Borders are taking a major hit.
At first glance, it might seem that people are no longer listening to music, renting movies, or reading books – but we all know that’s not the case.
The truth is, these familiar stores are being driven out by online companies like Amazon.com, iTunes and NetFlix, which are thriving by delivering books, music and movies over the web. They are serving customers and building a loyal brand – all while saving millions on “sticks and bricks” storefronts.
The sale and marketing of pharmaceuticals over the internet is also growing tremendously. Last year, Johnson & Johnson executives revealed that their company would be shifting away from pitching to primary care doctors in their offices and instead connecting with those physicians over the web.
So what does this mean for the banking industry? Are the same people who are buying and paying for their books, music, movies and medicine over the internet going to look online for all of their banking needs?
To answer that question, all you have to do is look around at all of the people on their phones. We have produced a whole generation of people who don’t do anything without first checking their iPhone!
Even though I grew up with a #2 pencil and a simple notepad, I now use my iPhone’s text feature to check bank balances, debits and deposits. I just type “last” and instantly get a full report on what has transpired in my checking account. I can buy almost anything and pay for it within seconds – all just by using my phone.
So what are these “land-locked” banks going to do? The way I see it, they only have two choices. They either have to go with the flow and embrace internet banking, remote capture and online bill pay, or they’ll need to find creative ways to get their customers and prospects into their buildings.
If they elect to stay in their buildings, they’ll need to offer more than just the traditional banking services. They’ll need to get into the content and education business and find ways to engage and interact with their customers.
Maybe offer classes on a variety of subjects from buying stocks and real estate to choosing insurance and retirement plans. Banks could even teach customers how to research and buy these items online.
Banks need to become the go-to place before anyone invests in anything.
Most banks already have the physical space and every town in America has business experts who would love to share their knowledge and network with other people in the community. And most would do it for free!
Banks need to look at things differently and take action. I had a professor in college many years ago who once said, “Be aware or Beware.”
That bit of wisdom still applies today!
###
Neal Reynolds has worked with hundreds of banks and credit unions around the country helping them to grow core deposits and market share without growing their marketing budgets. Contact him at [email protected].
