Banks Rethink the Small Business Resource Center
About three-quarters of the twenty-one firms in Watchfire GomezPro's Q4 2003 SOHO/Micro Banker Internet Scorecard provided a resource center to their small business customers. Generally, these resource centers exist to provide specialized content or tools for the small business owner. Unfortunately, many of these resource centers are stale and disconnected from the online experiences provided by the firms. Firms should revisit their resource centers to make the content more relevant to small business customers and try to link the information provided to specific financial services products.
Many of these resource centers were created during the dot-com boom, when banks feared they would lose their small business customer base to financial portals. They spent significant dollars and personnel hours trying to recreate end-to-end online experiences for small business customers, which included fully personalized experiences in which a small business customer could register to receive not only account information but also news, sports scores and weather. Additionally, banks rushed to sign up third-party small business services, such as Web hosting, e-mail marketing or e-commerce software that could be "sold" through a bank small business resource center.
Sadly, while these small business resource centers were all dressed up, few customers were willing to come to the party. Banks quickly discovered that their customers view financial institutions as trusted providers of financial services, and they want to use their online banking sites to check balances, make transfers or pay bills, or for more sophisticated cash management applications -- something confirmed by our own market research. In retrospect, the idea of a busy small business customer who might spend hours visiting a bank's resource center to get news and sports scores appears somewhat ludicrous.
So now, banks find themselves with small business resource centers that have been neglected for a few years, and in many cases, these firms have completely outsourced management and operation of these resources. But we believe these resource centers have value -- if they can provide timely resources that are tied into bank products and services. Market research indicates most small business customers are not fully aware of the breadth and depth of products available to them, and they tend to receive very little personal contact from over-worked small business relationship managers.
A bank can revitalize its small business resource center by integrating it into different products and services. The flipside also holds true -- a bank should deeply integrate products and services into the articles, news or advice that it offers in a wholly contained small business resource center.
As an example, consider that about half of the firms in Watchfire GomezPro's Small Business Scorecard offer tips, advice and calculators relating to managing cash flow or creating financial statements through downloadable templates. Shouldn't a thorough discussion of credit products available to small business customers accompany this information? Additionally, these institutions should also consider adding links to these articles from the separate credit product pages in their Web site -- clearly, if a customer is considering a credit product, they are likely thinking about their business' liquidity.
A number of the largest banks have created the kind of useful content we advocate, but even in these instances, the integration of this content into tasks and pages customers are visiting is lacking, reducing its effectiveness. If the management of a firm's small business resource center is outsourced, as is the case with many of the firms on our SOHO/Micro Banker Scorecard, then achieving a tight level of integration is trickier. These firms may wish to consider providing fewer articles that can be managed internally so they can provide a higher level of value to their small business customers.
Another small business resource center practice that deserves a fresh look is referring customers to third-party service providers. In an era of identify theft, phishing scams and other security issues, banks need to realize that many of these third-party referral agreements were struck in a different era, and should be reexamined. To the extent a bank does not provide a relevant financial product or service such as payroll, then banks can and should consider providing recommendations or direct links to their small business customers. However, many firms are still linking to, or even reselling, e-commerce services, which may only serve to confuse the customer.
Our discussions with firms on the SOHO/Micro Banker Scorecard leads us to believe that for some firms, the small business resource center is a need-to-have section of their Web site, but one that does not garner significant attention relative to other features. However, rather than ignoring it, banks should realize that the resource center occupies valuable real estate on their Web site, and realize also that small business owners are interested in helpful advice, especially if this advice is integrated with relevant products and services. Rather than segregating a section as a single-resource area, firms should view their entire small business Web sites as resource centers that can be informative and helpful.
Matt Lehman is a Watchfire GomezPro senior analyst who follows small business banking. Please send any comments or feedback to [email protected].