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Personetics Guide

What is Cross-Selling in Banking and How is it Changing?

In banking, cross-selling is selling an existing customer additional financial products and services.  Cross-selling in banking still takes place in the branch as often as not.  The great extent to which banks still rely on branches to both acquire and cross-sell customers explains why even national banks, with their advanced digital capabilities, build numerous branches when moving into new markets. 

But branch foot traffic has dropped 4% per year for over ten years as customers embrace digital banking.  The shift to digital has been dramatic: In 2022, the number of consumers using mobile banking at least once a month exceeded the number visiting a branch at least once a year.  Banks haven’t just witnessed this move to digital; they’ve encouraged it. 

But this shift means cross-selling in banking is having to change.  That’s because the digital banking cross-sell opportunity is very different from the branch and requires an approach.  Differences include: 

  • Frequency and intensity of touches: Branch visits take time, so customers go infrequently and when they have time.  A conversation with a banker doesn’t feel out of place; sometimes it’s why the customer is there.  Digital banking sessions are frequent and short, and customers tend not want to have conversations within digital banking, whether over live chat or otherwise.  On the other hand, they will be back soon, maybe later that day.  
  • Buying attitudes: Customers tend to talk to bankers in branches when stakes are high and options hard to navigate, such as with retirement planning.  Also, customers meeting with a banker tend to seek expert direction.  Customers who lean on digital for both researching and purchasing products tend to be self-directed: They want relevant information they can consider as they make their own decision. 
  • Macro versus micro personalization: Customers meet with bankers in the branch expect personalized recommendations on big picture topics such as retirement to reflect what the bank knows about them.  What they don’t expect to do is to discuss transactions in their checking account.  Customers have the opposite expectation for digital banking: They don’t expect big-picture conversations based on a holistic financial picture, but they do insights on their transactions, such as a heads up if they’ve been charged for the same streaming subscription twice in one day. 

The different nature of the digital banking cross-sell opportunity has led to changes in cross-selling at the most advanced banks. When cross-selling in digital banking, these banks: 

  • Turn transaction data into insights and nudges: Digital banking shows banking transactions, but most consumers don’t have the time to study these transactions.  Leading banks analyze these transactions to highlight what’s important.  Sometimes these insights can include a cross-sell offer.  For instance, the bank might call out that the customer is now able to save $25 a week safely and so now might be a good time to open a savings account and set up a recurring transfer. 
  • Break through with personalized engagement marketing: Banks have long run banner ads in digital banking.  Customers ignore them.  A few leading banks have found a better way: using the customer’s own transaction data to show the value of a product or service to that particular customer.  Examples include showing a customer how many rewards points they would have earned on grocery purchases last month if they had used the bank’s rewards credit card. 
  • Use digital channels to drive high-value in-person interactions: While digital banking has become crucial to bank cross-selling, branches are still critical to most banks’ cross-sell strategies.  Leading banks enable a customer to make an appointment to see a banker from within digital banking.  This capability smooths the way for complex conversations, such as planning for college expenses or considering a complex product such as a retirement account. 

The ongoing shift to digital banking has led to change in bank cross-selling in banking.  Leading banks are learning how digital banking creates different cross-sell opportunities that require new approaches.  Banks with branches are also learning how to balance digital banking and the branch to ensure the best fit for each customer interaction. 

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