Managing the timeframe to purchase in a customer’s lifecycle has always been a challenge for financial institutions. In an industry heavily reliant on relationships, the reality is that the B2B banking customer’s buying process is typically long, and rarely linear. Potential customers can enter and exit the decision-making process at any point, and external pressures are a heavy factor in whether or not a purchase (or change) will occur. Because of this, the industry has leaned on relationships as a key part of growth strategies.
But unfortunately, this reliance on relationships has been problematic in light of COVID-19. Not only are bankers limited by the lack of opportunity to build new relationships, but the B2B banking buyer’s decision-making process is changing. And many customers find that their banking experience has not met expectations., Challenges executing the SBA loans associated with the Payroll Protection Program have left customers feeling let down, so they’re looking for a new bank, and they’re looking now. Whereas previously you might wait five years for a customer to move from a passive to active stage, you may now only wait five weeks. So how are you enabling your sellers with solutions and tools to replace the face-to-face tactics?
The Traditional Buying Process for Financial Institutions
Traditionally, B2B banks face a long buying process. Potential customers typically stay in a passive phase for multiple years. While there, they might casually research new options to stay abreast of new trends and offerings, but they aren’t actively looking for a new solution.
Until a trigger occurs. Maybe a new CFO enters the picture, a new strategic initiative is launched, or a new regulation is passed. When that trigger happens, prospects typically move into an active purchase phase. This is when they begin re-assessing options and are likely to move business to those with whom they’ve built the strongest relationships. And thus, the long-term relationship pays off.
In the best of times this system halfway worked. When you rely on relationships to close deals, the only way to scale is to keep hiring more and more bankers. There’s no predictability, no scalability, and no way to hit huge growth targets without incurring huge expenses. As long as marketing and sales struggled to connect with buyers throughout the funnel, then the company would continue to miss growth goals. If you’re interested in learning more about these specific challenges and more facing the entire financial services industry, I recommend watching this webinar.
COVID-19 Impact on Financial Institutions
The reliance on relationships in financial institutions was already causing the most forward-thinking companies to transform their marketing and sales functions, but the impact of COVID-19 has forced every company to confront the problem head on.
Bankers can no longer drop in on the finance departments of the largest companies in town. They can’t grab lunch with the CFO or meet new contacts at a tradeshow or event. Their ability to drum up new business strictly from relationships has been significantly reduced, but in its place is a surge of demand for a new banking partner.
Normally banks have adequate time to prepare for new regulations or product offerings before they hit the market. But nothing is normal about our landscape today and the SBA loans associated with PPP have become a make or break moment for many banks. Those who have executed well, congratulations! You’ve most likely made a customer for life. But for those who have not, your teams are scrambling to retain customers. And as those customers flood out, the timeframe to purchase in this industry is rapidly changing. No one is waiting five more years to make a decision. They’re making moves right now.
Are You Poised to Capture New Prospects?
It’s absolutely critical that you prepare your demand marketing and sales teams to capture the influx of potential new customers. But because this industry traditionally relies on relationships, it’s likely you’re not sure where to start. Here are three steps to get you on the right path.
Step 1. Understand Your Buyers
Now is a critical time to understand your buyer’s motivations. Conducting first-person buyer insight research and validating it with third-party research is a necessary step to complete before moving forward.
We’ve already noted that timeframe to purchase is changing, but what else is shifting? Your prospects’ needs have probably changed in the last six months, and perhaps their content consumption preferences are different as well. Knowing the answers to these questions ensures that your marketing and sales strategy pivots are centered around the buyer. If you’re not sure how to answer these questions, read this blog post: 8 Deeper Questions to Ask to Understand Your Buyer.
Step 2. Create Content for All Phases of the Lifecycle
Based on what you uncover during buyer insight research, you might find that you have content gaps. For example, if your prospects are skipping certain phases in the buying cycle right now, but you’ve built more content for that phase anticipating that your prospects would stay there longer, then you might find that you don’t have enough content to support prospects where they are in their journey.
Additionally, you may need to revisit messaging. If your buyer insights show that pain points have changed, that needs to be accounted for in your content. This is probably something that you’ve already started to do, but make sure you’re adding new content strategically and updating relevant content regularly. As we continue to react to market changes and government programs, it’s equally as important to think strategically about how reactionary pieces can impact your business in the long run. We recommend following these four steps before creating new content.
Step 3. Revisit Your Demand Process
A cornerstone of a Strategic Demand Marketing state is an effective Demand Process model. The process by which a company manages its demand must be strategically defined and maintained in order to accurate measure lead quality and route leads to sales.
As prospects are looking for new solutions, you may see some new patterns. You may find that prospects are moving to Qualified Lead stage faster, that people who previously wouldn’t have been decision makers may now be considered stakeholders, and that prospects may expect sales to reach out sooner (or later) than what’s currently in place. All of these things are manageable, but they do require strategic thought and planning.
As the B2B banking customer’s buying process is compressed, so are all of its components. It’s crucial to revisit your Demand Process and make sure that scoring, progressive profiling, and Conversion Model are all working for you – not against you. Not sure what those things look like? Watch this webinar to learn about each topic in depth.
Your B2B banking customer’s buying process is rapidly changing and may continue to change for the foreseeable future. Adjusting to these times is critical to the success of your business. If you find that you’re overwhelmed by the steps above (or that you aren’t positioned to make any adjustments at all) then it could be because you’re stuck in a tactical demand marketing state ruled by random acts of marketing. You can read more about that in this post. If so, it’s time that you make the critical shift to a Strategic Demand Marketing state.
