Timothy Sloan is replacing John Stumpf, as the new CEO of Wells Fargo, due to the bank’s inappropriate and, perhaps illegal, cross-selling practices. In the October 13 Wall St. Journal, Sloan is quoted as saying,
“I don’t believe that strategy was fundamentally flawed. We are not abandoning our cross-selling focus. Cross-selling is shorthand for growing relationships with our customers.”
This shows a serious misunderstanding of what “relationship” means to Sloan and to the Wells Fargo organization. Only a banker would say that their relationship with their customers is based upon how many products the bank can sell them, whether they need them or not.
A relationship to most people involves some kind of human connection. A positive relationship is one in which people regard and behave toward one another with respect, understanding, and truthfulness. Strong brands are built on individual connections, not financial transactions, but most big banks seem to get this wrong. Perhaps this is why most banks typically rank very low on brand satisfaction surveys – they are focused on the wrong kind of “relationships.”
Wells Fargo and its new CEO need to give some serious thought to what is needed for the bank to truly serve its customers’ needs. They should change their focus on building the bank’s income and instead focus on how customers might define a profitable relationship. That is how we would recommend Wells Fargo make its next efforts to become appreciated, profitable, and to a grow a lasting brand.