Deepening Banking Relationships With Valuable Small Business Customers

Overview

While most businesses have only one financial relationship and tend to stay loyal to their bank, a subset of small businesses (31%) spread their accounts, products, and financial services across multiple institutions. Though these businesses tend to be more fickle, they also tend to be the best customers, with the highest digital engagement and profitability potential for the bank. This report examines how FIs looking to earn a greater share of financial products and encourage consolidation at the primary FI can design digital banking services and marketing to best target their most attractive small business customers.

Key questions discussed in this report:
  • How many banking relationships do small businesses have?
  • What does it mean to a “primary” FI?
  • Which products tend to be sought at “secondary” FIs?
  • What should the role of the relationship manager be in deepening small business banking relationships among the highest-value clients?
  • What digital tools can banks offer to encourage greater engagement and relationship depth?

Methodology

The small business data in this report are based on information collected in a random-sample panel of 1,000 small businesses and microbusinesses in a March 2017 online survey. Javelin defines microbusinesses as those with annual revenue between $100,000 and $1 million and small businesses as those with revenue between $1 million and $10 million.


The consumer data in this report are based on information collected in a random-sample panel of 10,585 consumers in a May 2017 online survey.



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