Small business smarts

Using CRM software can build your small-business relationships as well as your bank’s own business.

By William Atkinson

One differentiator between community banks and regional and national banks is personalized service. While large banks tend to focus on transactions, community banks prefer to focus on relationships.

Customer relationship management (CRM) software helps foster these good relationships by enabling banks to store and continually build the information they have on their small-business customers in a centralized database—and provide real-time visibility to this information.

By using specific demographic criteria, CRM can help banks segment and develop targeted marketing programs for their customers. Then, they can follow up with each customer in a strategically timely manner and subsequently analyze the relative success of an initiative.

“We are able to have more meaningful interactions with customers, because we have more information on those customers.”
—Jonathan Krieps, North State Bank

One bank achieving success with CRM is the $850 million-asset North State Bank headquartered in Raleigh, N.C., with banking offices in Wake and New Hanover counties, which specializes in small-business lending. “The main reason we introduced CRM was to get all of our data into one place—business loans, deposit accounts, online banking and more,” says Jonathan Krieps, executive vice president and COO.

The bank is well into its second year with CRM, and it is already seeing benefits on the revenue side. “We are able to have more meaningful interactions with customers, because we have more information on those customers,” Krieps says. “As a result, we have been able to increase our loan production about 20 percent with no additional head count.”


The percentage by which CRM has increased
loan production at North State Bank

United Bank of Union in Union, Mo., implemented the software in January 2017. The bank uses CRM information to interact with small-business owners regarding their future plans and goals and how they can get on track to achieve them. “CRM provides us with a compact and effective way to accomplish this,” says director of marketing Dan Rettke.

United Bank of Union already considers CRM a home run. “It allows us to track leads and follow through on them in an organized manner, and we are starting to see the long-term benefits in terms of building stronger relationships with our customers,” Rettke says. Some customers have added that they are receiving better customer service.

Shortly after implementing CRM, the bank realized that the software was streamlining processes and reducing paperwork. “As a result, we actually began saving some money, because employees are now able to do more in less time,” Rettke says.

The $450 million-asset Bank of Southern California in San Diego introduced a basic CRM system about six years ago but replaced it with a more comprehensive version earlier this year. “What prompted us to introduce CRM was to help us improve lending, and we are primarily a small-business lender,” says Tony DiVita, executive vice president and chief banking officer. Besides serving as an ongoing customer relationship management tool, CRM helps with lead identification; prospecting, including direct marketing; onboarding; tracking the loan process; and noting important customer milestones like anniversaries and birthdays

Industry VOICE

William Atkinson, a longtime Independent Banker contributor, is an Illinois-based journalist specializing in banking and small-business issues.