I’ve been at City National Bank for one year now. Re-entering the banking field after a 13 year absence has been an interesting mixture of “déjà vu all over again” as well as “wow, that’s a great improvement over the old way of doing things.”

My job is communicating information about our cash management services (AKA treasury services or treasury management services) to our clients, our employees, and, of course to our sales team.

Déjà vu All Over Sales

I am pleased to work with the high caliber of sales pros on our treasury team. They consult with prospects who are usually recommended to them by relationship managers in our branches, as well as other client-facing employees. So, this is where the déjà vu part comes in.

Back in the ‘80s when my banking days were just beginning, bank executives were exhorting their branches to “sell.” At the time, I focused much of my attention on educating the branch world in cross-selling to existing customers. That continued virtually unstopped across two different banks until I left to join a life insurance company etc. etc. through the ‘00s until I arrived here in early 2011.

Guess what? Bankers are still learning to sell.

Recently, I read “How to Confidently Ask Customers for Referrals”, a guest article in American Banker by Ned Miller, Senior Vice President, MZ Bierly Consulting, Inc. I wish I could link to his article, but it is in “protected” ABA space and not readily available. However, I will quote from some of the article here.

According to research conducted at the University of North Carolina’s Kenan-Flagler School of Business, 92 percent of prospects almost never book a meeting from a cold call or e-mail. That number may be higher than I would have guessed based on the comments of the bankers I work with, but the larger point should not be lost: cold callers face an uphill battle getting appointments with decision-makers.

What is the alternative? It is no secret that customer referrals beat cold calling hands down. With an introduction from one of your best customers you will usually have little trouble scheduling that first appointment. Gatekeepers seem considerably less intimidating when you can say that ―Bill’s fraternity brother/ golfing buddy/ neighbor/ top supplier Andy Miller suggested that I set up a time to meet with him.

In my time as a sales representative in the payments industry, I can vouch for this – as I’m sure any experienced sales person can. How much easier can life be than to get warm leads and referrals rather than making sales calls? The hard part, as Miller observes about bankers, is actually requesting referrals in the first place.

We find excuses not to ask for them. Do any of these excuses cited by Miller sound like things you’ve said or you’ve heard your sales team say?

  • I’m not comfortable asking for referrals.
  • I’ve gotten some pretty bad referrals in the past.
  • It shouldn’t be necessary — satisfied customers should give us referrals without our having to ask.
  • I’m not sure how to approach a customer on this.
  • It’s not part of our normal sales process.
  • It’s not something that is emphasized here.
  • This strikes me as too “salesy.”
  • What will I do if a customer doesn‟t want to refer anybody to me?
  • I don’t want to sound desperate.
  • I’m not clear when the best time is to ask for a referral.
  • It might be awkward for the customer.

As Miller states, the picture that emerges has implications for bankers (and other sales pros) at all levels.

  • For Sales Leaders: It is not enough to tell your troops to ask for referrals. You may have to provide specific how-tos and coaching on techniques to get people ready. If you do not break the process down into its component parts, your associates may struggle.
  • For Relationship Managers: This approach does take practice. Bankers who try it once or twice and moan that it does not work have to get about 25 more at-bats before giving up.
  • Beyond Bankers’ Reluctance

    Reluctance to call for referrals is not unique to banking, though it is probably more pervasive than in other fields where sales has been more widely utilized to drive new business. Traditional bankers expected the business to come to them because, after all, everyone needs to use banking services, right? Unfortunately, even though banking deregulation began in the mid 1970s and accelerated in the 1980s, bankers themselves took far longer to make a transition to the environment where competiton among banks and non-banks became fierce.

    My next post will be some thoughts on a great blog post I read recently about one of the biggest challenges any sales person must wrestle with – if they want to be effective. That is knowing when persistence morphs into its negative flipside: pushiness.

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