Bank of America CEO Brian Moynihan stated in a speech today he plans to step up cross selling as a part of his efforts to revamp the company. The strategy of cross selling is nothing new, but few financial providers have been successful in pulling it off. Why is cross-selling such a challenge? The reasons are two-fold:
From a customer perspective:
Nobody Can Be Good At Everything. It is the going in assumption that no single financial provider can have the best product in all situations. Consumers don’t naturally assume that their brokerage provider would also be the best provider for their mortgage.
To Each His (or Her) Own. Each product purchase is a discreet transaction. The product being purchased drives what is important. A customer may choose their checking account provider based on the availability of ATM and branches, but when that same customer is shopping for a credit card, they may desire the flexibility to aggregate debit and credit rewards which their existing provider may or may not offer.
“What If…”. There is some hesitancy on the customer's part to have all their "eggs in one basket." The current financial crisis has likely only added to the angst of holding too many assets with a single firm. While this concern will subside to a degree over the next few years, it has been and will continue to be in the back of consumer’s minds.