What Massachusetts needs is a bank on estrogen.
Regardless of whether we are man or woman, each of us has both the hormones testosterone and estrogen in our systems. A preponderance of testosterone leads to more male-like behavior, while estrogen brings out more feminine characteristics.
You could say the same thing about Massachusetts banks, or, frankly, banks anywhere. Regardless of whether they have men or women in leadership roles, banks are governed by testosterone- fueled traditions and approaches. Banking is geared toward men, not women.
That, however, is rapidly becoming a problem, because women long ago crossed the threshold of financial dominance. According to Prudential’s “Financial Experience & Behaviors Among Women” study, 95 percent of women act as financial decision-makers in the household.
What’s interesting to note, however, is that the rise of women in banking doesn’t seem to do much for women who do banking.
In Massachusetts, women make up roughly 60 percent of the employee base of banks, by some estimates. Many are on the teller lines, human resources, and other back office support operations, where they may not be in positions to dramatically affect the culture of the bank. But, as Banker & Tradesman writer Matt Brown pointed out in a story this past January, roughly one out of every 10 bank presidents in the commonwealth is now a woman. These are people of influence. Yet, if you compare the websites and marketing for institutions like Milford National Bank or Commonwealth Cooperative Bank – two banks led by women – they look and feel a lot like banks run by their male counterparts.
This isn’t a criticism of how the banks are run: both appear profitable and well-managed. At the end of the day, a bank president’s job is to ensure safety and soundness, and in banking that usually goes along with “tried and true” and “don’t fix something that isn’t broken.”
Still, while a black and white television set that isn’t broken may not need fixing, it’s not going to have a prominent place in the home that the colorful new HDTV will. And as women increasingly are the ones painting the economic picture, a little more dash and color in banking wouldn’t be bad.
Women Want More
I’m not talking about condescending initiatives, like putting marketing type into swirly, feminine fonts. What’s needed is a closer examination of what’s important to women, and how banks could adjust to meet those needs and desires.
In 2009, the Boston Consulting Group issued a far-reaching report on women and financial services, called “Women Want More.” One of the observations is that 47 percent of women are disappointed in their banks. Given the pullback in banking in the three years since the report was released, that figure is likely to have grown. It certainly didn’t get any better.
“Know what questions to ask women to show you speak their language and to get at what they care about most,” says Holly Buchanan, the head of Buchanan Marketing in Arlington, Va. and author of “Selling Financial Services to Women” and “The Soccer Mom Myth.”
“I’d love for my bank to offer a free one-hour personal financial coaching session,” she adds. “We could discuss my situation and ways to save or make more money. For example, I’ve been thinking about refinancing my house, but my bank has never talked to me to find out if that’s my need.”
Banks need to inculcate a sales culture that’s more empathetic, more caring and more in line with how women want to be talked to. As for personal service, for women that means a relationship with someone who “gets” them.
“Here’s where many banks miss the mark,” says Buchanan. “For example, I have a friend who is a stay-at-home mom and she hates the sales question, ‘So tell me, what you do?’ It makes her feel defensive since people expect her to answer with a job or career. She would much prefer, ‘In what ways are you responsible for your family?’”
Speaking of which, it’s not just the stay-at-home moms who need better attention from their banks. Women business leaders say they, too, feel that their financial institutions don’t appreciate, and don’t interact with them, as they do male business owners. That’s shortsighted.
According to American Express (which has done significant work to position itself as the small-business advocate), women-led enterprises are setting the pace for economic growth here. In Massachusetts, the number of women-owned businesses rose 31 percent from 1997 to 2011, according to AmEx OPEN, while revenues at women-owned businesses soared 65.3 percent during that same period.
That also matches up with the conclusions of the Boston Consulting Group. Women own or co-own 40 percent of U.S. businesses. Solely women-owned businesses are growing at twice the rate of all U.S. firms (and faster than male-owned businesses).
Banks that want to grow are banks that learn how to nurture female customers. Having women in leadership positions is certainly one element that’s important to women customers – they want to know there’s someone like them in authority at the bank. But more importantly, they want a culture attuned to their desires to reduce stress and emphasize honesty. They value relationship and service over price.
Be the bank that gives them that, and the rewards will come. Because, as global market research firm TNS points out, nearly 80 percent of women want to do their banking with just one financial institution. It doesn’t need to be a bank that’s led by a woman. But it does need to be a bank that acts like one.
