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Five Big Questions to Consider Before Strategic Planning Season Begins

August 23, 2018
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We are approaching strategic planning season again, and the competitive environment has not simplified for most financial institutions.  This business never seems to get easier, does it?  As institutions try to balance growth and profitability, here are five big questions to consider.  To get our full insights in each of these areas and much more, consider attending our second annual Raddon Conference this November 5-7 in Chicago!

  1. How can traditional financial institutions remain relevant and preserve revenue as consumers change their purchase and payment behaviors? Technology is profoundly reshaping the payments ecosystem, from mobile payments to P2P, from virtual assistants to social media.  Some of these channels avoid the interchange rails, putting non-interest income at risk.  For example, over a third of Millennials anticipate using mobile payments in the near future.  At our upcoming Raddon Conference, we will host a breakout session detailing what’s coming and how institutions can use their data to manage disruption.
     
  2. What is the connection between 'high tech' digital delivery and a 'high-touch', thoughtful experience? This thoughtful experience is highly valued by customers and employees alike, yet in the financial services industry, we struggle to balance that experience with the high-tech convenience they demand. Adding to the challenge are branches: 22% of consumers say they are no longer necessary, yet they remain institutions’ best platform for cross-selling and building relationships.  At the conference, we will host multiple sessions on delivering a high-touch customer experience in a digital environment and on the future of branching.
     
  3. Customer loyalty is critical to retaining deposit balances, but what can institutions do to maximize it? Customer loyalty can be integral to long-term growth and profitability, but simply having a consumer's most active checking account is not enough anymore. Big data can help tell part of the story, but the answer is even simpler than that.  Attend this session to discover the seven keys to loyalty and the one weird trick that USAA uses to generate industry-leading loyalty in its membership.
     
  4. As interest rates rise, what can financial institutions do to retain their rate-sensitive deposits?  Rising rates are putting pressure on institutions’ funding costs, as rate-sensitive consumers seek the opportunity to increase the earning potential of their savings.  Competition is heating up as well; recent Raddon research shows that 57% of consumers either currently use or would consider an internet-only high rate savings account.  At our upcoming Raddon Conference, we will host a breakout session exploring how financial institutions can update their deposit strategy playbook to use new products, features, promotions, and marketing to retain at-risk dollars while keeping their overall cost of funds as low as possible.
     
  5.  As financial institutions seek out growth opportunities, how can they leverage their strengths to fill the funding gap for small businesses?  During the recession, lending to small businesses, especially by the largest banks, receded, yet the recovery has not filled the gap effectively.  Community financial institutions can capture these opportunities, particularly with improvements in lending efficiency.  Recent Raddon research suggests that small business would be more willing to utilize smaller institutions if certain objections were overcome.  At our upcoming Raddon Conference, we will host a breakout session on how financial institutions can overcome the challenges of underwriting and processing to capitalize on their small business opportunities.

To find more questions and answers, attend the second annual Raddon Conference, to be held in Chicago this November 5 – 7.