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CertRM Series: The Importance of Relationship Management in Financial Services Sales

31 July, 2017Kevin Pope

The business banking market possesses far lower numbers of customers than the retail banking market. Nevertheless, the value of this market is high and is therefore attractive to banks and other financial services providers, which compete intensively for business customers of all sizes.

partnershipDefections in this market can be very expensive and replacement customers can be difficult to find, so relationship managers need to build strong connections with their existing customers and have something compelling to offer to potential new ones.

Every customer interaction is important and represents a ‘moment of truth’ for relationship managers. They will be judged on their pro-activity especially if they are initiating contact themselves or on the effectiveness of their response, if contact is initiated by a business.

Relationship managers now have an armoury of support tools available to them to help effectively identify customer needs. However, particularly in this market, they need to realise that customers do not like being ‘sold-to’ and therefore need to ensure that they do not make the mistake of over using data simply to achieve sales.

Nevertheless, all businesses have the need for a range of banking services and will look to their relationship managers to provide these. They are also likely to seek out competitors if incumbent managers fail to provide appropriate solutions when they are sought. There is a fine balance here, as competitors will also be constantly seeking to introduce new, relevant products and services at the appropriate time to drive a wedge into existing relationships. Incumbent managers therefore need to be sufficiently proactive, without resorting to hard selling, to fend off these approaches effectively.

Complex decisions are a feature of the business banking market, but the most sophisticated businesses are heavily reliant on relationship managers to guide these decisions. Given the degree of complexity that is involved with all but the most basic of banking products and services, trust and dependence are central to business relationships. It is therefore fair to conclude that relationship managers who take the time and effort to help their customers navigate through the complexities will enhance service and build loyalty.

The scandals in the corporate banking market that have been widely reported over the course of the past decade, such as derivatives mis-selling, LIBOR fixing and manipulation of foreign exchange markets, all demonstrate that customers’ reliance and trust in their relationship managers has sometimes been misplaced.

The Level 4 Certificate in Relationship Management explores in detail the nature of sales in this complex market and provides best practice for how relationship managers can operate effectively in this space by using appropriate tools, techniques and attributes to deliver outstanding service to business customers from the simplest to the most complex. As experience grows in deploying this best practice, the end result should be the attainment of trusted professional status.

Kevin Pope is the Chief Examiner for the CertRM qualification.

To find out more about the Certificate in Relationship Management, please click here.