Academic journal article ABA Banking Journal

Market Share on Their Minds

Academic journal article ABA Banking Journal

Market Share on Their Minds

Article excerpt

Yes, bankers are concerned about it. We've been hearing for a year at least that banks as an industry are steadily losing market share. But how do you define market share locally? How do you measure it?

In Nebraska, less than 10% of the banks know or compute their market share. And there is no consensus on what constitutes the true market components or how to gather the data.

Every bank knows how their asset and liability mix has changed. Many have reasons (or excuses) as to what brought about the variations. And most have plans--ranging from general to detailed--as to what they hope to do about it this year and next.

In group meetings throughout the state, bankers tackled these concerns and came up with some ideas, intentions, and revelations. Seventy-two percent claim they are market-driven. The other 28% say they are not market-driven because "our bank is not sales oriented." Honest--at least.

At two group meetings, the sales issue was tackled more specifically. Bankers were asked, "Does your bank have a strong sales culture?" From an admittedly small sampling, we learned that 60% do not. These bankers were then asked, "why not?" which led to these responses: 1. lack of leadership or top management resistance; 2. lack of incentives to sell; 3. lack of product knowledge and training; 4. tradition; and 5. "We emphasize customer service over sales."

If banking--as a total industry--has experienced the shrinking of market share we have all read and heard about, what are we going to do about it? For the industry as a whole, ABA and its affiliate, the Bank Marketing Association, are sponsoring a major, professional study of this area. …

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