Are Customer & Member Sales Programs Dead?


By Cindy J. Draper

Retail DDA Strategist & Director of Training

Negative media attention on mishandled sales programs and incentives doesn’t mean you should

reduce your own attention on the importance of selling. In fact, I would argue the opposite. Now is the perfect time to teach your front line staff how to sell strategically and with a renewed customer/member focus.


Why Continue with These Programs?


Consumers come to banks and credit unions because they can meet face-to-face and get their problems solved. A sales program with incentives motivates your team to perform at peak levels by encouraging them to identify account holder needs and offer available solutions. Incentives increase earnings and loyalty and reduce turnover with front line employees, and when done correctly, such programs meet compliance requirements and are consumer-friendly.


What Does It Take to Be Successful?


Having worked in several sales cultures during my 23 years in community banking, I’ve found that the most beneficial programs are closely monitored, consumer-focused programs. For programs to work, you need:


  1. Goals and Tracking. Without tracking and goals, employees revert to the path of least resistance, where they simply take orders and miss key opportunities to help the consumer.


  1. Top-notch training of your team is key so they can identify consumer needs – an approach to sales that is consumer-focused instead of product pushing. This increases products per household, consumer loyalty and profitability.


  1. High-pressure sales tactics will backfire. On the other hand, motivating employees to recognize opportunities and present them to account holders increases job satisfaction.


Compliance and Risk


The question about whether to continue these programs is certainly a hot topic given the notorious red “bad apple” that has been in the media spotlight.  But from my standpoint, the decrease in that bank’s (and other megabanks’) emphasis on selling is even more of a reason to concentrate on your own sales efforts.


Proper management of compliance and risk is more critical than ever in light of the CFPB’s bulletin outlining expectations for production incentives. While the bureau acknowledged that properly-managed incentive programs can benefit companies and consumers, it cautioned that inadequate oversight or setting unrealistic goals could lead to consumer harm. CFPB Director Richard Cordray noted that it is important “to make sure that … incentives operate to reward quality customer service, not fraud and abuse.”


Here are some best practices for managing compliance and risk in this area:


  • Management must be intimately involved in how sales programs are designed, implemented and supervised, and the board should be aware as well. Don’t wait for a review to ensure you have the proper controls in place.


  • Your employees must be instructed in your company’s philosophy and ethics standards and clearly know where the boundaries are.


  • All consumer complaints should be logged and monitored. You should document what actions were taken in response. These complaints should be shared with management (and periodically with the board) to ensure proper handling, investigation and action.


  • Ensure that your account holders are consenting to sales, and that proof is documented.


  • Solicit feedback from your team through surveys, periodic ongoing interviews, exit interviews and hotlines.


  • Ask employees how someone could game the system, and review any outliers in performance.


  • If employees are overachieving, audit their results. If they are underachieving, research whether they have the resources needed and whether their goals are manageable. Sales goals should be aligned with branch traffic and staffing, and should be obtainable.


You’ll find that continuing to build a sales culture is more important than ever to succeed at your financial institution.  At Velocity Solutions, we are standing by as your partner to help you add more accounts, maximize the profitability of your existing accounts and manage your key sources of non-interest income. Contact us today!