Wholesale retail.

• Author: Cohen, Soni
• Position: Sales management techniques for banks

Sell, Sell, Sell. It's the mantra today of retail banking. We train our sales people in every nuance of the selling process. We monitor and reward their sales efforts. And, as every successful salesperson knows, we work hard to understand the customer. However, to sell well we also need to examine, from the customer's perspective, the sales process and the environment.

The concept that customers are buying while we are selling is, of course, obvious. However, taking this concept a step further leads to the creation of an effective buying environment. That is, a retail experience that best meets the customers' needs, preferences and behaviors, and takes into account what actually motivates customers as they make a buying decision.

To understand this perspective, let's review the classic study undertaken in the 1980s by a major cosmetics supplier. The supplier's product line consisted of a full range of makeup, beauty aids and other such items. For many years, this firm had been promoting its products based on the premise that the company was selling only cosmetics. However, a relatively simple piece of market research dramatically changed the supplier's approach to the business.

The company executives asked their customers to describe what they were buying. And the answers were surprising. Rather than talk about moisturizers, mascara and lipstick, the participants talked about youthful-looking skin, longer lashes and more sensual lips. In other words, they were buying an image. Although the customer was purchasing cosmetics, what they were really seeking was an improved appearance.

While this approach has been widely accepted in 2001, the change, at the time, generated a major transition in the way the cosmetics industry marketed products. This new mindset had many implications with respect to how to communicate with customers and how to set up retail environments that would motivate customers to buy.

This new perspective has had an important impact on the financial services industry as well. As we know, customers may be purchasing a home-equity loan, but they may be motivated by an improvement in their lifestyle. Or, while mutual funds and annuities are the product, the customers' inner desire may be long-term security.

While the lessons learned from the cosmetic industry are important and relevant, it is equally important to understand that the financial services industry is unique in many ways.

As bankers, we tend to group our products...