Western Independent Banker - January/February 2009 - (Page 22)

automated tracking and reporting about each referral made. This wasn’t so easy in a paper-based world, but is quite reasonable with electronic communications. Paper-based referral programs typically involve branch personnel giving customers forms that they in turn give to their friends. When the friend brings the form back to the bank and opens an account, the bank gives rewards program credit to both the customer and the friend. It’s a good start. But tracking the flow of paper is difficult. Now banks can point customers to online forms where they can provide contact information for their friends. And the banks follow up. The beauty of the system is that banks know exactly how many referrals customers make and exactly how the friends are responding. That means banks can experiment with offers and make adjustments as experience suggests. The next step in drumming up referrals is concentrating efforts on the customers who make recommendations most often. Even among satisfied customers, only a relatively small portion will go out of their way to recommend a bank. Thus, it’s important to court these customers and structure rewards to really show appreciation for their referrals. Lastly, a managed referral strategy includes tracking results at each branch. Whether an organization is selling checking accounts or industrial widgets, it’s critical to know which sales tactics work well and which are not so successful. Analyzing referral results for individual branches leads to identifying best practices and starting conversations among managers about applying those best practices throughout an organization. Busey Bank, for example, has determined that community events at branches and collateral material in the hands of sales people make a big difference. Growing the Customer Base A steady stream of referral business can spell the difference between solid growth and steady erosion of a customer base. But it isn’t an entire acquisition plan. Internet capabilities, rewards and pricing are still important topics in any planning session about gathering deposits. Branches, too, will remain an important part of community banks’ retail delivery strategy for many years to come, and not just because banks have big investments in the facilities. Even as branch transaction traffic declines and declines, they remain an excellent venue for presenting a bank’s expertise in financial matters. That can lead to cross selling and relationship building. Still, technology-based referral work is a must for branch banking operations. It works perhaps because it rests on one of the banking business’s foundation principles—that asset quality should be carefully nurtured. The asset in this case is perhaps the most important asset a bank has, its base of loyal customers. Bob Sterner is the executive vice president for My Rewards® (www.myrewards. net), a leading provider of rewards strategies for financial institutions. He can be reached at 910-254-9383 ext. 130 or at bob@myrewards.net. IT’S A JUNGLE OUT THERE. Use an experienced guide. LarsonAllen’s CPAs, consultants, and advisors are dedicated to providing quality results. Our industry specialists tailor our services to your needs. We offer a wealth of business resources to each of our clients. General controls | Network penetration | SAS 70 Audit | Tax services | Regulatory compliance DeNovo banks | Trust and ﬁduciary services Bank Compensation Consulting leads the industry with its approach to servicing its clients with state of the art plan design that assists banks in attracting, retaining and rewarding their leaders through: compensation customizing; design and implementation of customized Executive and Director beneﬁt plans; Bank Owned Life Insurance (BOLI); and ownership succession planning. The company has a core group of professionals who have over a decade of experience working with more than 500 banks nationwide and providing ongoing plan administration and monitoring. Kathy Smith, President Kelly Earls, JD, CPA Principal www.bcc-usa.com ©2008 LarsonAllen LLP 5000 Legacy Drive, Suite 230 ~ Plano, Texas 75024 972-781-2020 or 800-781-2099 22 www.wib.org Western Independent Banker http://www.myrewards.net http://www.myrewards.net http://www.bcc-usa.com http://www.larsonallen.com http://www.wib.org

Table of Contents Feed for the Digital Edition of Western Independent Banker - January/February 2009

Western Independent Banker - January/February 2009 Contents A Message from the President & CEO Managin Liquidity and Funding During a Recession Staying Liquid in a Time of Regulatory Sea Change Managing Liquidity in a Volatile Rate Environment Regulatory Outlook for Brokered Deposits Deposit Growth and Branch Network Effectiveness Turbo Charging Account Acquisitions FDIC-Insured Sweep Accounts Creating a Contingency Funding Plan WIB Service Corporation Report WIB Calendar New Members Index of Advertisers advertiser.com

Western Independent Banker - January/February 2009

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