Season 2, Episode 40: Tom Hershberger

 

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Tom Hershberger: I didn't.

 

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Jack Hubbard: Yeah. So whenever so, as I mentioned in the introduction, Tom Hershberger is one of my best friends in the industry, he's 1 of the top 3 most favorite people I know in banking, and it is such a privilege to see you, Tom. I see you're wearing my my T-shirt. Maybe you want to

 

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Jack Hubbard: tell the story behind that if you will.

 

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Tom Hershberger: I would love to Jack, and I have had the privilege of teaching at the strategic marketing school for the graduate school of Banking. It's a 1 week specialty school, just for marketing professionals, sales and relationship building professionals. And when Jack made the decision that he had finished up he was going to have his last year at the strategic marketing school.

 

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Tom Hershberger: It! It's just we knew it was going to be a hollow spot. So it's like, what do we do? Let's have some fun. So we contacted all of the class members before they arrived, got their shirt, sizes, and unbeknownst to Jack. His teaching day was all day on Wednesday middle of the week, and every one of the students in the classroom showed up with an I know Jack shirt on, so that we could have a little fun for the day and fun we had. It was great.

 

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Jack Hubbard: It was great, and unfortunately I try to convince my wife that I know Jack, and she says you don't know Jack, which is, which is interesting. Well, so great to have you, Tom, let's let's start. I want to talk about bank marketing and community banking. You're in it, and you're all over it. But let's start with cross financial. Give us a little sense of what cross financial does and who you help.

 

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Tom Hershberger: Yeah, we we are totally dedicated to the banking industry. In fact, the

 

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Tom Hershberger: bulk of our clients are true community banks, most of them in the midwestern part of the United States Cross financial has been around since 1993. So we've got 32 plus years in the mix here, as we're working with banks. But our core focus is really to say, Hey, how can we help you with good, solid strategic planning, customer experience management.

 

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Tom Hershberger: the appropriate staff development to go with the relationships we're trying to build and the experiences we're trying to generate. How do we research and manage data effectively so that we can be better at connecting with those customers.

 

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Tom Hershberger: We've got folks on the team here that are doing employee and customer and market research projects so literally, when we started cross, the idea was, we need to provide a really nice cross section of support services. So relationship managers, marketing professionals, senior leaders would have the resources they need to do whatever's necessary. And you know you don't always have every

 

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Tom Hershberger: expertise built into the team. It just isn't affordable to do that in a community bank. So how can we bring some of those into play? And and we've continued to fill those buckets since

 

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Tom Hershberger: since we started in in 93.

 

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Jack Hubbard: Well, I've known you for about 30 years, and I don't think I've ever asked you this question. I know you were a banker. How did that all happen, Tom? How did you move from banking into owning your own business?

 

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Tom Hershberger: Well, it's probably a simple story. Because I started in 1974 in a community bank worked in banking until 93, when I left the bank. I stayed in banking by just going to the other side of the desk, and maybe that was fear, because I didn't want to have to learn a new industry. But there was competency there. So we just made that transition. We had a team of people at a an institution that we were working at here in Nebraska.

 

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Tom Hershberger: Solid group of people. And there there was a core group.

 

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Tom Hershberger: 3 of us that we all left the bank at the same time we started the company just launched things and said, Let's go. And and so literally, we just transitioned to the other side of the desk. But my banking experience includes everything from

 

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Tom Hershberger: drive in teller to internal auditor, to bank. CEO, I mean, there was a lot of fun learning in that that period of time. But yeah, it's all been banking. I love this industry. I drive through so many communities throughout the Midwest

 

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Tom Hershberger: that wouldn't be there without the local bank, and they wouldn't be thriving without a courageous banker saying, we're going to make Main Street part of what's going to thrive. So I just love the industry. It's fun to see it happen, and it's great to see it when it

 

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Tom Hershberger: thrive, and it just flourishes and thrives within a rural community, or any community that that needs that financial support.

 

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Jack Hubbard: Well, let's stay with that theme. I was at Indiana bankers recently at the Mega Conference, and I saw Mary Beth Sullivan and and Mary, Beth and I were talking about this.

 

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Jack Hubbard: You and Mary, Beth and I all started in banking about the same time kind of in the early seventies, mid seventies and back. Then there were about 14,000 banks. And now we're down to about 4,400. I'm curious, because I think you're right. Community banking is really the cornerstone of so many communities in America, and you're out talking to bankers all the time.

 

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Jack Hubbard: What's the state of community banking now, Tom, what's what's the temperature like as we kind of hit the midpoint of the year.

 

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Tom Hershberger: I would say healthy. A year ago, the 1st couple of quarters of the year there was a lot of I wouldn't say it was pessimism. But, boy, there was a lot of concern. We had interest rate trends that weren't helping. We had some unrealized losses on the balance sheet that were a challenge for profitability, and some of those conditions are still in play a year later. But

 

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Tom Hershberger: the bankers they always survive. Jack, I mean community bankers find a way. They just do that entrepreneurial we're going to make this happen is a huge part of what they do and do extremely well. So given enough time to respond to change or challenge or problems. They'll they'll get the solution, they absolutely will. And I think that's what happened. We went through a period of oh, man, margins are horrible, unrealized losses are challenging our bottom line. What do we do?

 

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Tom Hershberger: And they've had a year to kind of work their way through. Okay, what's possible? What can't we change? What will we influence? And in general, healthy, we have a lot of optimism from the banks related to asset quality. We're not seeing a lot of really deep holes related to industries that are in trouble creating credit issues.

 

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Tom Hershberger: There's always going to be challenges right now we're hearing from Ag banks that it's a bit of a struggle with commodity prices where they're at with input costs as high as they are. Okay.

 

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Tom Hershberger: We know those are in play, but just like the good community bankers, the really good ag producers, they find a way so honestly, I think it's pretty darn optimistic and let's face it. As long as we retain control of the payment system. Community banks have every opportunity to make it work. They absolutely do. And I think in general, we've got a really committed industry with some great folks running the banks.

 

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Jack Hubbard: And some of those great folks are in marketing, and I'm curious, because that's what you do, and you do it every day, and you do it? Great! What are some trends you're seeing in bank marketing these days?

 

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Tom Hershberger: Well, nobody will be surprised when I say this deposits, deposits, deposits the funding side right now. We haven't talked to a single marketing professional that hasn't said, Hey, we're trying to do our absolute best on deposits. So we know that's in front of us that it's usually when it goes through cycles like this. It comes and it goes when interest rates, fluctuate or demand changes.

 

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Tom Hershberger: Right now it's just been a long slug of

 

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Tom Hershberger: loan. Demand is fine. The economy is holding up pretty well now we have funding issues, so we don't have a single bank that's not pursuing low cost deposits, pursuing checking accounts, Treasury management services. I can't tell you the number of calls we get and inquiries about organizations trying to figure out the secret to Treasury management because they didn't pay attention to it before.

 

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Tom Hershberger: But they are now, and they're trying to figure out what's the delivery channel. What's the structure? How do we sell it. How do we service it? We've never really done this before, but we need to. So those things are driving a lot of what's happening. And we've even talked to a banker not that long ago, Jack, that about a year ago

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Tom Hershberger: they got together with all their lenders and say, Loan demands fine the flow, the pipeline. It's all good.

 

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Tom Hershberger: We need all of you lenders to generate deposits, and they flip their reward program to focus on deposit acquisition, instead of lending, which will have its own impact, because down the road, then you lose momentum on lending while you're replacing with energy and deposits. But we're just seeing a lot of change in play because of that. And as a result.

 

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Tom Hershberger: you've got small businesses and and mid-sized companies that could be using technology. And the banks finally get giving enough attention that they're hearing about it. Oftentimes. Companies and clients and customers don't know, because nobody at the bank's sharing the story they're not saying, Have you considered? Would this fit with your solution? So

 

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Tom Hershberger: that trend is huge? I hear it everywhere we go. I just finished a marketing conference down in Texas, and all the bankers were talking about. Yeah, my number one challenge from management

 

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Tom Hershberger: is, what are we going to do about continue to do about deposits, although I would tell you, in addition to that, just as kind of if I was thinking, my top 5 or top 7 trends website, reconfiguration redesign updates is huge. Right now, I think everybody in the industry finally realizes we've got a self service

 

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Tom Hershberger: mentality that's kicking in any of us that go to the store and do self checkout because we like the technology, or we just prefer the solitude of not interacting with the cashier. Whatever the condition, everybody's looking for that same simplistic functionality in their delivery channels. And so websites are getting attention. And that's a good thing, because many of them are very static, very dated.

 

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Tom Hershberger: not user friendly. Or if they do have a few features, it's extremely limited. So it it's great to see that kicking in.

 

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Tom Hershberger: And and it's appropriate the other thing, Jack, that I'd probably add 2 more to kind of that top list. One is information management, whether it's a Crm.

 

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Tom Hershberger: But just data management in general?

 

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Tom Hershberger: What do we know about our customers? What do we know about our performance? How do we match the 2 together? How do we create accountability for relationship building. So the Crm tools are making a big play as well as any data management tool. Even if it's core core based, banks are looking for those solutions because it's going to drive a lot of what they're going to be pursuing with other activities. Maybe the last thing on that list is Brand.

 

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Tom Hershberger: It's amazing how many banks we're talking to that are rebranding, updating brands, changing names, all the 1st nationals and all the 1st States and all the farmers, banks, and farmers and merchants banks are looking at, saying, there's still confusion in my trade area.

 

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Tom Hershberger: Okay, how do you create some distinction? And it's not just the name you've got to deliver a great culture attached to the brand, and everything goes with it. But you know, marketing people are going to have to be absolutely solid in their understanding of all those moving parts, because they can support them, or they can kind of work around the fringes. But the folks that are performing well, they're going to excel at this. They're going to be your toughest competitors.

 

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Jack Hubbard: Yeah.

 

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Jack Hubbard: And I'm really glad you brought up Treasury management. It's just one of those things that just irks me. You know, community banks want deposits.

 

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Jack Hubbard: but they they are always behind the curve. Several years ago they should have been hiring Treasury management folks that actually go out and sell instead what a lot of community banks are doing is having their commercial lenders try to do that which is not possible. They just don't know enough. And then, when they have, or they'll have an operations person or a branch manager. Do it part time. You can't have full time customers dealing with part-time bankers. It just isn't going to work.

 

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Tom Hershberger: Yeah. And you know it's interesting, Jack, because mortgage those take mortgage loans as an example. When banks are doing mortgage loans, and they're earning their fees up front, and maybe they're selling the servicing. Maybe they're not. But there's a revenue stream with every one of those transactions, and it's easy to pursue it. It's easy to pay for it. It's easy to incent employees to do it, because there's a revenue immediate revenue stream that's identifiable, and we can attach to it. Treasury management is so similar.

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Tom Hershberger: I mean, we want the funding. So let's start with the idea that it's driven by the deposit account. But all of those services that, instead of giving them away for free, have enough value, we can charge for them.

 

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Tom Hershberger: or the revenue that comes off of debit and credit card interchange fees, or whatever the residual revenue might be. Treasury management has the potential to say, the more you do, the more we make, and the more we make the easier it is to tie it to everything that helps make the sales and marketing

 

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Tom Hershberger: engine run. So why, we don't invest more in just saying, How do we make it? Phenomenally successful? It's a puzzle. But the other piece that goes with it, and you mentioned it on the lender side. We really do need specialists.

 

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Tom Hershberger: I'm the worst lender in the world. The bank knew when I was the CEO. Let Tom work with the bank, but don't let him make loans. Okay, that's it. It's not my competency. But, man, when you've got a really good lender.

 

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Tom Hershberger: the last thing I want to do is distract them with. Oh, by the way, be sure to spend a lot of time on Treasury management, because if their real value is underwriting a loan and creating that connection between collateral and character, and everything goes into it. I don't want them spending time on the other pieces. So

 

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Tom Hershberger: how do you build an environment where professionally, we can bring the right people to the table. When you know that business or that

 

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Tom Hershberger: entrepreneur needs the assistance and would value from things that are technology based or service based. Treasury management is one of those so.

 

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Jack Hubbard: Yeah. Here's here's another challenge. The world is moving very quickly. If you look at a a data from Barlow, for example, or the research.

 

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Jack Hubbard: When middle market businesses small business when they need advice, they are about a 17 to 19% likelihood of working with their banker. And I find that challenging in a relationship environment. So my question to you is.

 

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Jack Hubbard: what are you seeing your banks do effectively to help its bankers communicate with the marketplace with value. For example, here we are in a continuing uncertain situation around tariffs. We need to communicate that to our customers, not tell them what to do but to give them some alternatives or some best practices, or a few ideas. Anyway.

 

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Tom Hershberger: Yeah, you know, we're not seeing. The unfortunate thing is, we're not seeing a lot of organizations very proactively, saying, Hey, let's make those connections between market uncertainty, economic changes, tariffs, whatever it might be. How many of their small businesses get

 

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Tom Hershberger: impacted, directly or indirectly by the fact that they may have a supplier who is increasing prices or is changing delivery because of tariffs. We don't see a lot of organizations digging in deep saying, How do I bring value by really understanding the issue, having lenders who understand the issue. And I'll just say lenders in general, because most banks lead with loans. That seems to be the relationship trigger is, let's start with loans and worry about the rest.

 

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Tom Hershberger: So just looking at that group, how do we bring value to man? I'm concerned about my receivables. I'm concerned about my inventory. I'm concerned about my cash flow. I'm concerned about the cost of something we don't hear about a lot of organizations that are bringing that into play. It is interesting, though. We did a planning meeting recently for a bank, and one of their directors is in the lumber business, and as a result, they're getting a lot of

 

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Tom Hershberger: trade interaction between the Us. And Canada. The second day of our strategic planning meeting he wasn't available because he was back at the office adjusting all of their pricing and delivery and other schedules because they were bumping up against that very 1st tariff deadline that ultimately got extended. But his immediacy was, I've got to fix this or I can't operate tomorrow, or I can't operate next week.

 

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Tom Hershberger: and I don't I don't we? I think we have an opportunity to bring value to the banks. If we'd absolutely help through some of the education, some of the familiarity.

 

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Tom Hershberger: Let's face it. If if I'm a local welding shop in town and I'm working on fabrication every day, I'm not spending a lot of time thinking about tariffs and cash flow and the impact of

 

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Tom Hershberger: what's going to go into the receivables. But my banker could help me. I mean, my banker could be kind of my tool.

 

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Tom Hershberger: so I can keep doing what I love, which is, I'm going to go fabricate stuff. So I think there's a tremendous opportunity, a relationship building opportunity in there, Jack.

 

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Tom Hershberger: But I'm not sure we're seeing a lot of organizations. Say, Hey, how do we turn this into a competitive advantage? How do we turn this into that moment where the clients going? I really like the bank, because here's what they do. And yeah, they do loans. And they do good rates, and they do affordable whatever. No, I mean, what do they really do? It's that relationship stuff that's based on value

 

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Tom Hershberger: trust

 

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Tom Hershberger: information, great educate. I mean, there's so many moving parts there, and I don't see a lot of organizations, maybe spending enough time on that component. And you know the byproduct. The next time I need to get a relationship growth opportunity going, I'm going to ask for the best rate because it's the only way to sell my product. No, I don't need the best rate. If I'm bringing the other value to the table.

 

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Jack Hubbard: No doubt about it, and and one of the other challenges, of course, is, and I was at the Nephma Conference in Portland, Maine, a few weeks ago, and one of the bankers, you know, because I talk about

 

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Jack Hubbard: retail and business, and how marketing needs to, you know, get better with business bank marketing, and the person came up to me and said, Look, I'm a i'm a 500 million dollar bank. I'm the only person in marketing. I've never had any background in business banking. I'm curious if that's a trend you're seeing as well, and maybe what some banks have done to try to help their marketing professionals help business banking better.

 

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Tom Hershberger: Yeah. Well, okay, business bankers. If you're listening, you have to open up your arms here. I mean, one of the challenges we have. Jack is a lot of marketing professionals. Their their core focus is where the bulk of things are at and bulk, meaning the activities, not necessarily the resources. So the bulk of the activities are consumer and retail oriented. So that's where they spend their time, their attention.

 

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Tom Hershberger: the things they're they're working on. And then there's always this fairly distinct line between. Well.

 

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Tom Hershberger: stick to your lane because we're business banking, and

 

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Tom Hershberger: well, we're we're business banking. Leave us alone. We know our thing don't get in our way.

 

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Tom Hershberger: At what point do we sit down and say, Hey, we've got some highly skilled marketing professionals, great strategic thinkers. They're capable of bringing resources into play that maybe you don't normally put in the mix. And, by the way, why don't we, just collectively, as a partnership, figure out

 

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Tom Hershberger: how business banking, with whatever they feel, is the

 

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Tom Hershberger: modus operandi, or the best way to build business?

 

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Tom Hershberger: Give some of that challenge to the marketing people and say, Hey, if you were going to fire this up in a slightly different perspective, what else would you add? What else would you do that partnership? Just it needs to be improved. Put it that way because most of the marketing people we talk to is like, yeah, whether it's Ag or commercial business. It's always that team kind of does their thing. And then we do everything else.

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Tom Hershberger: And I just know we've seen it in organizations. When everybody plays well together.

 

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Tom Hershberger: Everything's better. I mean the the high tide does lift all boats at that point, so I don't know if it's a turf war, or I don't know if it's a dividing line. But let's face it. The customer is still the same customer, Jack, a business owner.

 

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Tom Hershberger: I have personal relationships. I have business relationships. I absolutely have some commingled relationships between those 2. We've got a family member in the business with us, our son Kyle. You bring in his individual as well as business perspective. We have to realize the whole center of this thing is the customer.

 

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Tom Hershberger: They're a decision making unit. They're an influential

 

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Tom Hershberger: unit that ties into the business decisions, the home decisions. And I'm going to try and make the best decision for both.

 

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Tom Hershberger: And if I've got a banker who's mainly retail, or a bankers who mainly business. I'm missing part of what I need in their balance for delivering a really great relationship. So there's a lot of play there, and I think we have to figure out good ways to pull them together, because I do have a tendency to hear more often than not that. Well, here's the playground that marketing is in, and commercial and business developments

 

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Tom Hershberger: a little bit different. It's over here. No, it's all the customer. It's not about the line of business. It's about the customer.

 

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Jack Hubbard: Yeah, that's very true. So you sent me before we started.

 

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Jack Hubbard: Sent me this interesting article from the Wall Street Journal.

 

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Tom Hershberger: Yeah.

 

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Jack Hubbard: 7 min Post about AI recently our friend Eric Cook posted something with Baby Eric, where it was a baby with headphones on with Eric Cook's voice. Bizarre.

 

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Jack Hubbard: I'm curious what? And and I gotta tell you. At the at the Indiana Bankers Mega Conference there were 6 programs on the docket, and maybe more, maybe that I just didn't see all the titles, 6 programs that dealt in some way, shape or form with AI. So let's talk about the elephant in the room. What are you seeing, Tom about, AI, and how marketing and community Banks is using it.

 

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Tom Hershberger: Well, the easy answer is very little. Here's the challenge. We've got marketing people who are saying I really would like to research it. I'd like to use it. I'd like to begin dabbling in it, even if we're not going to make it part of our full blown execution.

 

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Tom Hershberger: and you have a firewall at the bank and and operations area going? No, no, no, so some people are not doing it just because they've been told they can't. And that's unfortunate, because I even if I can't do something at the bank because of the firewall, because of everything else that goes into security.

 

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Tom Hershberger: I still need to learn it. So do I need to go home and use my personal computer to play around at a personal level. I have to find a way to learn it, because we don't know what we don't know. So that's in play for me. And we're not seeing enough organizations doing much in that regard. The article I sent you today is so interesting, because

 

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Tom Hershberger: down in Texas, when we met with the bankers down there, we we had a polling question that we asked them about. And

 

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Tom Hershberger: the question was simply this, you know, which form of advertising or communication is the thing your bank uses most

 

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Tom Hershberger: and 57% of the bankers said social media

 

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Tom Hershberger: so well over half and nothing else was even close. The next closest

 

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Tom Hershberger: for active use for most of their advertising and marketing dollars was billboards.

 

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Tom Hershberger: and it was less than half of what we had at social media. That article talks about Zuckerberg and Meta, now developing an AI tool where all you have to do is tell them what's your product, what's your price?

 

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Tom Hershberger: What generally are brand components or images that you want to reinforce. And AI does the whole campaign. They do the appropriate placements they select where those fixed, placed, paid positions will be. And I'm looking at these results going. Okay, if over half the bankers are relying that heavily on social media.

 

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Tom Hershberger: and it's that easily replaced or certainly supplemented. We've just said, you know what out of the things we love most and our main things to do. List. Item, it can actually be replaced.

 

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Tom Hershberger: That's scary. And I think what's missing, Jack is we have. We do look at marketing as a lot of tasks and a lot of projects and a lot of activities. But we don't necessarily position in the organizations as a true strategic

 

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Tom Hershberger: tool and part of the arsenal to say, Wait a minute. We've got so many moving parts. If it's just social media. Maybe AI will replace us, but we've we've worked with clients where they go in. And they say, Hey, we've we've got a new swipe and save savings product. So every time you use your debit card we're going to round it up and put it in a savings account.

 

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Tom Hershberger: We watched a bank go in and say, I want a full blown campaign.

 

00:26:01.210 --> 00:26:28.830

Tom Hershberger: I want newspaper ads. I want social posts. I want a Newsletter article for my newsletter for customers. I want a press release. They literally just gave it the instructions and said, Give me 3 campaign ideas and the related messaging copy and and imagery to go with it. AI can generate the whole thing. Is it perfect? No, but if I'm a 1 person marketing department, if I'm not using it.

 

00:26:28.830 --> 00:26:46.809

Tom Hershberger: I'm spending a lot of time and resource on research background, any kind of discovery trying to pull ideas together. All of that can be assisted by AI. And what starts out, maybe as a 1 week project maybe ends up being 2 days.

 

00:26:46.810 --> 00:27:16.499

Tom Hershberger: That's found time for me if I'm a marketing professional. So whether it's something as simple as copilot that's already built into Microsoft, or you you spill over into Chat Gbt. There are so many tools out there you're going to have to find which AI fits what you're doing, but I don't think any marketing professionals can afford to say I'm going to wait till the bank lets me do it because the learning curve, whether you're on the curve or not, your competitors are.

 

00:27:16.550 --> 00:27:32.520

Tom Hershberger: They're going to get there before you. And all of a sudden they're going to have a marketing department of one that can run a billion dollar bank marketing department instead of adding 3 and a half people. And now you're spending all your time managing people instead of the output. I mean, we've got to find ways to put

 

00:27:32.640 --> 00:27:38.730

Tom Hershberger: productivity, efficiency, and what is going to prove to be a really valuable resource into play.

 

00:27:40.110 --> 00:27:51.209

Jack Hubbard: Well, you talk about productivity. So productivity. You've discussed interest income, and we've talked about non interest income. I'd like to do a little bit of a lightning round with you.

 

00:27:51.210 --> 00:27:51.720

Tom Hershberger: And he's.

 

00:27:51.720 --> 00:27:54.680

Jack Hubbard: Of these. Let's start with productivity.

 

00:27:54.680 --> 00:27:55.060

Tom Hershberger: Yeah.

 

00:27:55.060 --> 00:28:05.539

Jack Hubbard: Talked about websites. But get deeper with me. What's happening there? What should I be considering if I'm a bank Cmo around making my website more effective.

 

00:28:05.790 --> 00:28:26.430

Tom Hershberger: Yeah. 1st of all, I think everybody and and get connected with a great professional company that does this not just throws ideas onto the website, but literally understands the analytics behind behavior. Where, if I start here, what is it that's likely to be the desired outcome for the customer? Well, how do we build a resource for that?

 

00:28:26.430 --> 00:28:38.110

Tom Hershberger: Functionality is the key, the navigation. How do I get it to a minimum number of clicks? How do I make that information intuitive and valuable enough that once I finally arrive at the data page.

 

00:28:38.110 --> 00:28:39.590

Tom Hershberger: I feel like it's relevant.

 

00:28:39.590 --> 00:28:58.529

Tom Hershberger: Or do I just load it up with bullet points for every feature in the product, and we expect the customer to distill all that information into their decision. I mean, it can only do so much in relationship building, Jack. And if if we have offers that are so clean, so easy to understand that we can say free checking, free gift.

 

00:28:58.540 --> 00:29:04.229

Tom Hershberger: 4% interest. Maybe the customer can think about that process go good enough for me.

 

00:29:04.320 --> 00:29:15.069

Tom Hershberger: But in most cases you've got customers where they've got stuff going on. So what's the best solution for them? Just understanding the website is that conduit?

 

00:29:15.250 --> 00:29:42.840

Tom Hershberger: It's a lead generator. It's an educational tool. Put the right application on what it's going to do for you and then embed in it what needs to be there based on your, if I want my website to be an extension of the bank be a brand of sorts. What do I have to do to make that happen? Do I need online applications for loans? Yes. Do I need online approval of loans. So we do even more immediacy. We know banks that are doing that.

 

00:29:43.130 --> 00:30:02.300

Tom Hershberger: you know, with consumer loans in particular, where the decision making in some of those organizations drives to AI or a credit model you're either in or you're not. It's either approved or it's not. I mean, how immediate can you make the bank's response could be part of that? But do I have to be all the way in to have this be functional? No.

 

00:30:02.300 --> 00:30:15.729

Tom Hershberger: So do I need online account opening for deposit accounts. You know what we hear most. Well, that's kind of a security thing. And we're not sure how we're going to deal with that with Bsa and everything else. So it's just better if they come into the bank.

 

00:30:16.530 --> 00:30:29.175

Tom Hershberger: But the customer, you know, the customer self service. And they're going. But my expectation is I should be able to do it online, shouldn't I? Because I can do everything else online. So we're running into that competitive

 

00:30:30.340 --> 00:30:39.410

Tom Hershberger: piece here the construct of well, if Amazon makes it absolutely seamless, and then I experience a bank where it's not, how do I grade the bank.

 

00:30:39.430 --> 00:31:01.109

Tom Hershberger: and none of our community bank clients can invest enough money to be an Amazon. I mean, it's just not going to be that seamless. But what are the things that matter most to your customers? And let's speed up the integration of the important things, and let's ignore the distractions that come with. Oh, I looked at Bank of America's website. And they're doing this. We should be able to do that. Do you really need it?

 

00:31:01.200 --> 00:31:25.159

Tom Hershberger: Because you might not. I mean, what does it take to be proficient with your business model, your customers, your product line, and the way you want to structure your customer experience. The website needs to reflect that along with whatever your branding standards are, because it's literally the 1st place, an awful lot of people are going to go when they consider banking at Cross Bank and trust. Are they going to call the bank? Maybe?

 

00:31:25.160 --> 00:31:42.150

Tom Hershberger: Is it likely they'll look at Crossbank and trusted with the Google search. Yeah, pretty much so. So give them that initial exposure that builds confidence makes a connection, your imagery, your everything goes into the website is going to help drive some of that underlying.

 

00:31:42.160 --> 00:32:00.450

Tom Hershberger: Is this bank right for me? And it has to come from the customer's perspective. Too many websites are written from. Well, here's what we'll do for you. Here's what we'll do for you here. No, it's no it. It's not about the bank, and how great we are as a bank. It's about the solutions we can offer to somebody who's interested

 

00:32:00.510 --> 00:32:05.740

Tom Hershberger: in managing their money in financing. So I mean, there the focus is the customer.

 

00:32:06.230 --> 00:32:33.710

Jack Hubbard: Yeah, for sure. Last week I interviewed Richard Vander Bloom, who is just amazing. 200,000 followers. He has the annual Linkedin algorithm report, and one of the things we talked about was Linkedin advertising campaigns. And so I want to go to social media with you. And what Richard talked about was fascinating. He talked about how important it was to create a thought leader campaign

 

00:32:33.910 --> 00:32:52.269

Jack Hubbard: and push it out to individual ads and not make it look like an ad. We've got Facebook. Maybe that's for grandparents. I don't know anymore. Facebook, Instagram, Pinterest, Tiktok. And of course, Linkedin.

 

00:32:52.720 --> 00:32:59.819

Jack Hubbard: That's a lot. What are you seeing your banks do around attacking social media from a marketing perspective?

 

00:33:00.050 --> 00:33:04.240

Tom Hershberger: You know, the vast majority, I I think, have realized they they are not

 

00:33:04.430 --> 00:33:22.079

Tom Hershberger: deep enough into this game, and they don't have enough time to absolutely tackle every one of those platforms. So most of them are picking the ones that either they're most comfortable managing, or they feel like really do match up closest with their target audience.

 

00:33:22.130 --> 00:33:49.440

Tom Hershberger: Facebook, despite the fact that it's it's the old horse in the run. Here we still still see a tremendous number of banks, using it as one of their primary pieces. And it's okay. Match it up with your audience. Make sure that it's getting the kind of response rates that you're getting that need to be getting to justify it. And then, if you make extensions into other areas, go for that. I'm amazed, Jack, how many banks do not spend

 

00:33:49.650 --> 00:34:07.379

Tom Hershberger: any time whatsoever, improving what's going on on, Linkedin, you know there's a profile, no picture, no background, no no bio to review, and and we expect somebody to go look at Linkedin. See, one of our lending professionals have no information on them. So where's the credibility?

 

00:34:07.700 --> 00:34:11.079

Tom Hershberger: I think it has to be a in general.

 

00:34:11.100 --> 00:34:35.269

Tom Hershberger: a cohesive approach to it's 1 of many tools, and it needs to dovetail well with what you're doing. So Instagram gets attention. Facebook gets attention. Linkedin needs attention. You know, those are the primaries. We don't talk to Banks that are doing in Snapchat, or or anything that's too. Youth oriented. Most of the banks aren't spending a lot of time pursuing that group, and

 

00:34:35.270 --> 00:34:56.489

Tom Hershberger: I can advocate for that because they don't have any money yet. So you know, at what point do I really need to put an anchor into Gen. Z. Or Gen. Alpha? Well, when they start making decisions that are truly their decisions. I want to be in play, but I'm going to invest my money where the money is, and they're not there yet.

 

00:34:56.978 --> 00:35:17.420

Tom Hershberger: So those are in play. I think we've got a number of banks that are are starting to try and leverage Youtube. And I would tell you just from what we're seeing. If you read the research and and stay kind of connected to the trends. That video based component is important. I mean.

 

00:35:17.640 --> 00:35:36.950

Tom Hershberger: why did Instagram work the way it did well, because it was an enhancement of a very static, text-based Facebook. But added videos, why did Tiktok take off? I mean, there are some trends out there that are worth paying attention to, because if my potential customers there, or my existing customers there, I want to be there too.

 

00:35:38.030 --> 00:35:53.500

Tom Hershberger: I would tell you, Jack, and you may experience this with when you talk to people about Linkedin. But the unfortunate part is, we have a lot of banks using social platforms to put it out there, and they spend absolutely no time analyzing what's working

 

00:35:53.500 --> 00:36:04.210

Tom Hershberger: what's not what generates a click, what generates a lead. They can't tell you anything about it. They just feel like it's the best place to go with their attention right now.

 

00:36:04.210 --> 00:36:24.070

Tom Hershberger: It's also the cheapest in many regards. So it's a natural for community banks to do a low cost solution. So that happens, too. But if we're going to use it, let's determine if it's working or not, and we're going to have to become a little more tech savvy? With respect to analytics, if we're going to get the most out of those social platforms. So

 

00:36:24.070 --> 00:36:39.070

Tom Hershberger: the the advocacy for developing really compelling content critical. In fact, I part of the for me. If it if it isn't valuable content. Don't throw it out there. We always laugh because

 

00:36:39.070 --> 00:37:08.279

Tom Hershberger: Banks always put they're going to be closed on a Bank Holiday, you know. We'll be closed Monday, and then people like it, you know, you get the thumbs up reaction to oh, you're going to be closed Monday. Maybe they're doing it. The reaction is because they want people to value that holiday. Maybe it's all bank employees saying, Yeah, I get a day off. But it's amazing that we look at that thinking. Okay, we got some really good response to that. No, you need really good response to things that are driving solutions.

 

00:37:08.380 --> 00:37:14.140

Tom Hershberger: financial solutions. The customers are interested in our content needs to be headed that direction.

 

00:37:15.410 --> 00:37:28.360

Jack Hubbard: You know you brought something up that's so interesting to me, and I hadn't even thought about this. You know I I have gotten to the point where I'm watching a lot of Youtube. Now, we don't have Youtube TV.

 

00:37:28.360 --> 00:37:51.519

Jack Hubbard: So I'll watch fishing videos or golf videos or something. And I'll get so pissed because, you know, like 38 seconds in there's an ad. But what I'm seeing, Tom, are local avails, local availabilities for ads. And I remember when I was a banker many, many years ago, time and Time magazine and Newsweek

 

00:37:51.570 --> 00:37:54.569

Jack Hubbard: used to allow local avails.

 

00:37:54.570 --> 00:37:55.200

Tom Hershberger: So.

 

00:37:55.200 --> 00:38:06.290

Jack Hubbard: Put an ad into time, and Newsweek and people go. Jeez, that's a big bank. This sounds like, I can start doing that now on Youtube. Are you seeing some of your banks do that?

 

00:38:06.290 --> 00:38:30.240

Tom Hershberger: We are, and we're seeing it more with our clients, competitors than we are with our clients, and some of this has to do with size and innovation, although I always encourage marketers. Whatever you're doing today, think about what you would be doing if you were twice this big. Because that's where it's going. I mean, we were looking at some numbers. I'm going to get off track here a second. We were looking at some numbers this morning

 

00:38:30.860 --> 00:38:38.770

Tom Hershberger: since 2010 the average bank size has increased 315% just since 2010.

 

00:38:39.360 --> 00:38:44.560

Tom Hershberger: We had 91 new bank charters in 2,008 91.

 

00:38:45.000 --> 00:38:50.000

Tom Hershberger: We didn't have that many in the entire period between 2010 and 2020.

 

00:38:50.300 --> 00:38:59.969

Tom Hershberger: So no, you stated earlier, you know the number of charters is down. Yes, but what is the condition that goes with that? The average size of the bank is going up?

 

00:39:00.090 --> 00:39:14.250

Tom Hershberger: So anybody that's in that marketing or any kind of an entrepreneurial role in leadership within a bank should be saying, Hey, whatever we're doing today, what's it look like if we're twice this big, because that's where we're headed, and probably pretty quickly.

 

00:39:14.250 --> 00:39:38.870

Tom Hershberger: So you start to pull some of those pieces together, and I do think some of those fixed placements or those opportunistic placements where they go. You know Youtube viewers. If if we are really good with ag industries, how do we get attached to the viewing pattern of ag producers that are using Youtube. And you can be that specific in the things that you're doing for

 

00:39:38.870 --> 00:39:43.370

Tom Hershberger: placements. I'm sure that's part of what's being built into the Meta

 

00:39:43.550 --> 00:39:56.559

Tom Hershberger: resource that is going to use AI to do your whole campaign for you. They will know where the connections are at and place accordingly. But don't assume because you don't feel big enough, that it's not an open

 

00:39:56.700 --> 00:40:24.810

Tom Hershberger: opportunity for you, so I we do seem to run into it more often where bankers are saying, Hey, look what my competitors doing as opposed to them, saying, how would we take advantage of that? Based on what we're trying to accomplish. But again, the consumer behavior, the business owners, behavior, the ag producers. Behavior is what I should be understanding, because if I want to communicate with them. I have to go to where they are. They're not. I'm not going to bring them to me. I have to go to them.

 

00:40:26.230 --> 00:40:53.499

Jack Hubbard: Well, this all gets to. How do I know? And I don't know of another agency in community banking that does research better than you. So what are you? How are your banks looking at research? What are they asking? What are they trying to find out? And I'm also curious about our people ask actually answering these questions because there's so much customer research out there.

 

00:40:53.890 --> 00:41:19.249

Tom Hershberger: Yeah. In fact, we've had traditionally, in the industry, a heavy reliance, and just ask the questions. The customers respond. You you work your way through the response and go from there. No, I mean, think about the idea that the research, the respondent that you'd love to hear from is in this swipe mentality. I mean, it's like I'm going to read 3 words. If I'm interested I might stay. If not, I'm moving.

 

00:41:19.250 --> 00:41:31.710

Tom Hershberger: So the whole methodology has to change, Jack. And the one value proposition we have that's still solid in community banking is, your customers do feel connected to their bank.

 

00:41:31.720 --> 00:41:53.270

Tom Hershberger: They are the best group to go to, because they're interested enough to stay with you a little bit. They're not just gonna sweep on past something, but it doesn't give you the whole story. Your your market potential is going to be built on the non customers that are part of your prospect list. So we do need to give some thought to creative use of

 

00:41:53.350 --> 00:42:21.489

Tom Hershberger: in the moment transaction. Whether it's a post transaction survey that's tablet based. That's only 2 dots. And they're done. I mean, the data gathering has got to shorten. I can remember hearing from bankers that were, and early in my career, but you know they were doing 20 min interviews for 750 respondents, and it was loaded with open, ended questions. It's like, No, that's gone. It's not going to happen anymore.

 

00:42:21.790 --> 00:42:32.889

Tom Hershberger: Can we do simple things like focus groups that traditionally have been very revealing when organizations are trying to figure out what a very specific audience is thinking, you can.

 

00:42:32.890 --> 00:42:54.870

Tom Hershberger: but there is so much phishing going on, and there are so many scams going on as soon as people start to hear. Hey, would you like to come and share your thought. No, we'll pay you. No. So you literally have got to step back from that and say, How do we leverage an online survey because they still can work highly, effectively.

 

00:42:54.870 --> 00:43:07.689

Tom Hershberger: It has to be short, it has to be concise. It has to work on a tablet. It has to work on a telephone screen. It has to work on a desktop. It has to be user friendly. I mean, there are just things that need to be included.

 

00:43:08.070 --> 00:43:21.789

Tom Hershberger: But I think our research has always in the past been focused on telephone research, written surveys, online survey. We stopped thinking about. Wait a minute. What is the customer telling us because of what they do?

 

00:43:21.910 --> 00:43:34.050

Tom Hershberger: So are we really doing a deep dive into transactions? Are we doing a deep dive into website, inquiry, history. We have the ability with analytics to look deeply into a lot of moving parts in the bank.

 

00:43:34.290 --> 00:44:02.729

Tom Hershberger: but we don't take the time to say, Wait a minute. If it's out there, how would we capture it and then tabulate enough of that information so that we could distill it down into not just data, but data that generates an observation. And so I think we're missing the boat on data management because we don't dig deep enough. Or we just say we know it's in there, but we can't get it out of the core, and then we just stop. We can't stop. We've got to be able to turn that into something valuable.

 

00:44:02.780 --> 00:44:16.609

Tom Hershberger: But some of the traditional approaches. If they don't get upgraded, if they don't get modified, they're going to be a complete failure. So a written survey to customers every 6 months will not produce the right results, because the customer

 

00:44:16.670 --> 00:44:19.220

Tom Hershberger: feels like 6 months ago. I just did this.

 

00:44:19.540 --> 00:44:37.379

Tom Hershberger: in fact, in their mind, it wasn't 6 months ago. It was just a couple months ago, and it's like, No, I'm not going to do it again. We have to be very strategic about what we do when the frequency that goes with it, the length of the survey, the ease of completing it. And then we have to extend it into. And what are we going to do about data?

 

00:44:37.500 --> 00:44:47.449

Tom Hershberger: Because what customers do we are recording? I mean, I if I'm writing a check or an automatic payment to adp security services every

 

00:44:47.510 --> 00:45:12.260

Tom Hershberger: month, you know, I probably have a home security system. Well, how do we use that as a data point that helps us reveal what the customer is doing, what they're. You know, they're obviously concerned about security. Does that mean it's a higher value home. I don't know. But you can find that data point, too. How do we start to connect the dots? Our research has to extend beyond traditional forms. If we're going to get better at it.

 

00:45:14.050 --> 00:45:27.409

Jack Hubbard: Things have changed an awful lot in marketing. I was a big marketer. Let's transition over to interest income. Yeah. One of the things that's interesting in the big, beautiful bill. If it gets passed.

 

00:45:28.130 --> 00:45:35.229

Jack Hubbard: Interest, income, interest, expense on auto loans may be deductible again.

 

00:45:36.210 --> 00:45:50.230

Jack Hubbard: I want to talk about customer retention, cross solving, and generating income from the franchise that actually trusts you. What are you seeing banks do around customer retention.

 

00:45:53.320 --> 00:46:21.600

Tom Hershberger: I think the easiest answer is, most community banks feel like they're probably covering that base with their onboarding program because we're doing the best job we can during those 1st 90 to 120 days to solidify the connection with the bank, build into that initial purchase additional services, if that's possible, which most onboarding programs get triggered by a new checking account, but not necessarily by a new loan. Why not? If it's a new customer.

 

00:46:21.660 --> 00:46:37.460

Tom Hershberger: Why don't I onboard every new customer? And then the offers, and what I suggest, and why I suggest it is built out of that customer's need through that 1st decision making period. But the other side of that is, what do you do to reboard

 

00:46:37.530 --> 00:46:49.330

Tom Hershberger: the customer who's been with you forever because we take them for granted, I mean significantly. So all these concerns about deposits, deposits, deposits, and every bank's looking for the next new deposit.

 

00:46:49.480 --> 00:46:53.570

Tom Hershberger: Part of the value proposition is just, don't lose the deposits you have.

 

00:46:53.840 --> 00:47:03.699

Tom Hershberger: And what are we doing to solidify that we've we've heard stories from banks that are still sending out their mandatory CD notification

 

00:47:03.860 --> 00:47:22.650

Tom Hershberger: notices when there's a maturity coming up, or an automatic renewal coming up. That's fine. That might be the legal step. But then they add to that the fact that every one of those maturing CD customers is going to be contacted by the bank. And you've got some bankers and Cfos going. No, let those alone. If they're going to renew at a lower rate, leave them alone.

 

00:47:22.670 --> 00:47:35.869

Tom Hershberger: and the banks that are doing it are looking at the long term big play, which is, how do I keep the customer extremely satisfied over time, and not because I want to always reprice them into the most expensive

 

00:47:35.940 --> 00:47:46.459

Tom Hershberger: product, but I want to stay in touch with them and let let them know you know what that money is maturing. You have an opportunity to do something with it. You have an opportunity to let it sit

 

00:47:46.540 --> 00:48:03.180

Tom Hershberger: what comes with that, and whether it's safety and security, because that's what they're interested most. Maybe it's the monthly income off the interest that whatever the customer wants needs to be part of that discussion, and in a lot of organizations are going well, we don't have the time for that.

 

00:48:03.340 --> 00:48:16.393

Tom Hershberger: and I just kind of smile, because I know that if their competitor is being more proactive in those touch points. They're going to be successful, not only with their own customers, but probably with that competing Banks customer. So

 

00:48:16.820 --> 00:48:19.549

Tom Hershberger: the simple things, Jack.

 

00:48:20.120 --> 00:48:42.380

Tom Hershberger: producing your lists of your your top customers by balance. I would look at your top customers by debit card usage, because they're giving you all kinds of revenue. What are those little triggers that say, Hey, this customer is valuable to us because one of our corporate goals is A, B, and C, and this customer is contributing to 2 of those.

 

00:48:42.490 --> 00:48:57.970

Tom Hershberger: Okay, then what do I need to do to ensure they remain a really successful, highly valued customer. So some kind of reboarding, some kind of program that creates consistent touch points not to the point of annoyance, but always to that

 

00:48:58.180 --> 00:49:03.480

Tom Hershberger: directive of I'm concerned. I want to make sure that I'm getting you everything you need.

 

00:49:03.910 --> 00:49:32.559

Tom Hershberger: Life changes for everybody. So they add a new child to the household. Conditions change. They buy a house, conditions, change. They start a business conditions change. What are we doing proactively to be there for them in that moment? Or do we just hope that it's a well when they get around to it, they'll call right? It doesn't work anymore. Because consumers have too many options at their fingertips. They can go anywhere in a moment. So how do we get them to just settle in with us has to be a directive.

 

00:49:33.380 --> 00:49:41.865

Jack Hubbard: Yeah, you talked about triggers. I was talking to a bank recently, and they said, Well, we just made a conversion over to a new platform

 

00:49:42.180 --> 00:49:42.500

Tom Hershberger: Okay.

 

00:49:42.500 --> 00:50:12.440

Jack Hubbard: Or poor provider, and I said, Well, oh, that's exciting. What are you gonna do with the triggers? And they said, Oh, well, we aren't turning them on. That's too expensive. So what's a trigger trigger is if I get an average daily deposit balance, and I make a rule that says anything that goes up 20% or down 20% from that. I should get a trigger that says you ought to call customer, but they didn't want to turn it on, because it was too expensive. And.

 

00:50:12.520 --> 00:50:19.280

Jack Hubbard: my God, it's too expensive to lose all those deposits. But so anyhow, I I.

 

00:50:19.280 --> 00:50:30.246

Tom Hershberger: Cause. The the alternative is, you lose the customer, and then you pay a premium price to attract the new customer, which is your most expensive acquisition. No, I mean, keep the current ones happy.

 

00:50:30.560 --> 00:50:50.399

Jack Hubbard: Absolutely. Let's talk about as we kind of wrap this up. Let's talk about non-interest income. The Cfpb is not gonna is overturning the overdraft rule and who knows where? That's all all gonna go? What are you seeing around that new regulations? Things like that that could affect non-interest income.

 

00:50:51.300 --> 00:51:16.349

Tom Hershberger: You know, I most of our banks are telling us, hey? It's a wait and see until we know for sure what's gonna happen. They just aren't going to be very proactive about most of that. And and I think in many cases it's fine, because we we can get caught up in the short term distractions, and and then not have the resource. We need just to get to the big decision. But, what we are seeing Jack is, organizations are saying, hey, what are those

 

00:51:17.000 --> 00:51:34.309

Tom Hershberger: those leading non-interest income revenue sources? And and then how do we ramp those up so? Whatever organizations can do with debit and credit card, not only penetration but usage. We have a 1 of our clients. They they reward

 

00:51:34.340 --> 00:51:58.389

Tom Hershberger: customers for signature transactions on debit cards. They don't get rewarded if they use pins on their debit transactions debit card transactions, but if they'll push credit and sign, they get a reward for it. Well, that's an interesting forced behavior. It's like, let the customer do whatever they want. Yes, but the bank also knows. Our revenue stream is significantly higher

 

00:51:58.390 --> 00:52:15.450

Tom Hershberger: with the credit transactions the way our contract is written than it is with debit. So they're finding ways to enhance interchange, fee and activity, and the revenue related to it by requesting a specific kind of transaction. I think the same kind of underlying revenue

 

00:52:15.520 --> 00:52:39.969

Tom Hershberger: assessment goes into things like, okay, home loans are down. We're not getting as many application fees, and we're not getting the revenue stream we had when rates were low and everybody was refinancing, but we still see a lot of home transactions occurring. So what are you doing to get more than your fair share of those deals? That generate, immediate, non-interest income and loan fees is a big part of that. What are we doing to

 

00:52:40.270 --> 00:52:56.389

Tom Hershberger: increase e-statement penetration? So we can reduce postage costs. I mean, what are we doing across the board? Whether it's a true product or maybe a related service where we're going. Either the advantages it generates revenue or it saves us some money.

 

00:52:56.920 --> 00:53:12.560

Tom Hershberger: Well, how do we build that into sharing solutions with the customers that include, that we have banks that are excited when they see a growth in their bill pay user or their bill pay customers or their digital service registrations.

 

00:53:12.560 --> 00:53:32.650

Tom Hershberger: But the second question that goes with that is okay. They signed up. But do they use it? Because once they get to active usage, now they're producing what you want most, either in savings operationally or generating revenue. And and that non-interest piece, I think the banks and the bank marketing professionals. The Cmos can literally look at that saying.

 

00:53:33.220 --> 00:53:40.900

Tom Hershberger: Where does behavior benefit us? And is there some way for us to promote extensions of that behavior to a higher level.

 

00:53:40.910 --> 00:54:09.580

Tom Hershberger: Okay, let's work on that. And I think there's influence there, instead of just waiting for the customer to hopefully do what you want them to do, direct them to solutions that benefit them, but also play a significant role for the bank, and some of them are going to be simple. You don't have to have a brand new line of business banks that are doing investment services. There's commission and revenue sharing that goes with those transactions. So instead of protecting my CD customers from the investment rep.

 

00:54:09.640 --> 00:54:21.099

Tom Hershberger: maybe I become more of a companion with the investment rep and say, my customer wants a higher rate, and I don't want to lose them, but I don't have a rate that's high enough to get to them. Do you have something. Let's make that combo work.

 

00:54:21.260 --> 00:54:23.770

Tom Hershberger: How do we find a better way to cross? Solve

 

00:54:24.050 --> 00:54:36.600

Tom Hershberger: with the solutions we have that are beneficial to the customer? Because ultimately that feeds the bank in some way, maybe not in my line of business, but it might be in somebody else's book of business. Either way. I've taken care of my customer.

 

00:54:37.130 --> 00:55:06.639

Jack Hubbard: That's very true, and we have to get better at that. I haven't heard the word district in disintermediation in a long time, and I'm glad, because we need to realize the customers the focus, and if if we do a good job for them they'll make money. Well, Tom, I gotta ask you one more question, and and I know this is, gonna be tough. But open your magic 8 ball. Tell me 5 years from now, 3 years from now I'm a bank. Cmo, I'm a community bank. What's what's in my future?

 

00:55:06.870 --> 00:55:07.470

Tom Hershberger: Hmm.

 

00:55:07.520 --> 00:55:19.120

Tom Hershberger: well, I'm going to change. There's gonna be a lot of change, you know. It's interesting as you think about that window, because the average size of banks will go up.

 

00:55:19.120 --> 00:55:47.800

Tom Hershberger: So wherever I'm at today, just assume you'll be twice that big in 5 years, and it may not happen that quickly. But if you're thinking well, I can't do that till we get to 500 million. We'll start thinking like you're already needing to do that, because even if you're not ready to do it, your competitor will be. So we've got to start thinking bigger. We've got to start building sophistication into the mindset of the marketing professional again, that article that I shared with you this morning. That is a threat

 

00:55:47.840 --> 00:56:06.369

Tom Hershberger: when you start to think about, hey? If the thing I do best. I do social media posts. That's what the bank wants me to do more than anything else, whether it's working or not. That's what I'm responsible for. And then we find out that, by the way, Meta is going to have an AI bot that literally with a little bit of input will do that whole thing for you.

 

00:56:06.390 --> 00:56:26.669

Tom Hershberger: No, I want to look at that 5 year window, saying, Hey! Marketing professionals become an entrepreneur within banking, become a strategic partner to business banking, to Ag, lending to retail and consumer deposit acquisition. Be that strategic partner that says, Hey.

 

00:56:27.210 --> 00:56:56.720

Tom Hershberger: can we build a little Mini business plan for you that fits into the overall strategic plan. But it absolutely optimizes your customer, base your prospects, your customer, base your prospects, your market potential. And what's there and what isn't there? I think we've got to build a broader, more strategic skill set, and the marketing professionals that are absolutely beating it. 5 years from now are the ones that are going to build that skill set. It's great to know how to do a post

 

00:56:56.910 --> 00:57:17.979

Tom Hershberger: that's not going to be your survival tool. Your real mechanism here is to say, Hey, I need to become an active strategic element within our senior management team, and my goal should be to get there and doing social posts won't be the mechanism for that helping. You understand net interest margin and how to improve it.

 

00:57:18.250 --> 00:57:33.190

Tom Hershberger: Understanding how to generate additional fee income or enhance revenue. We have to become a bigger picture player and not just work real hard, hoping somebody will notice. I think we have to earn the right to make that possible.

 

00:57:33.603 --> 00:57:48.290

Tom Hershberger: And and I, the professionals that do it that understand the information's in there, and we can pull it out that the markets have potential in some areas, but not others. And we can match that up with what the bank's trying to accomplish.

 

00:57:48.300 --> 00:58:14.550

Tom Hershberger: The marketing professionals that start to pull that together are going to win the other thing, I think in the 5 year window, Jack, we need to have Community bank Cmos becoming branding Czars. I mean, I mean, we literally need to have really comprehensive brand management for a couple of critical reasons in the past. Okay, we have a branch, we occasionally do an ad. We have signage good.

 

00:58:14.570 --> 00:58:30.389

Tom Hershberger: Everything you do now is basically worldwide, and that brand management and the consistency behind that none of our clients have huge budgets, so they're always figuring out, how do I get the most out of the few dollars I have? Well.

 

00:58:30.580 --> 00:58:54.990

Tom Hershberger: highly effective branding makes every dollar leveraged against the previous dollar spent. So I mean, really great brand management. And that doesn't mean well, my bank needs a new logo that could be part of it. But the brand is the culture, it's the service. It's the customer experience. It's how you educate your customers, how you pull your staff in how engaged? Every I mean, it's the whole mechanism

 

00:58:54.990 --> 00:59:07.090

Tom Hershberger: that when somebody finally says, Oh, cross bank and people go, oh, yeah, good bank. Okay, that's what you want to hear. And I think our marketing professionals need to be part of the catalyst for that to happen.

 

00:59:07.240 --> 00:59:30.600

Tom Hershberger: So broaden your horizons, get get bigger, even if your bank isn't getting bigger. Look at your profession and say, my perspective and my expertise has got to get bigger. I need to be a contributor to asset liability management. I need to be a contributor to revenue enhancements. I need to be a contributor to business development in the commercial area

 

00:59:31.315 --> 00:59:44.469

Tom Hershberger: and in some of those cases, if we wait to be invited to that table, it may not happen because you might have leaders that look just like me. They're older, and they've been doing it the same way forever, and they don't want to change.

 

00:59:44.710 --> 00:59:53.439

Tom Hershberger: but it will change whether they want to or not, it's going to change. So be on the side of progressive and figure out how to be part of that team.

 

00:59:54.940 --> 01:00:10.719

Jack Hubbard: Well, you are a part of lots of teams in community banking, and whether it's branding or research, or websites or digital advertising, nobody better than cross financial. And Tom and Kyle, how do people get a hold of you, Tom? If they have a need.

 

01:00:10.720 --> 01:00:20.419

Tom Hershberger: That's easy, but we keep it real simple. It's at [email protected] [email protected].

 

01:00:20.950 --> 01:00:21.479

Jack Hubbard: No.

 

01:00:21.480 --> 01:00:37.339

Tom Hershberger: [email protected]. The website's the same crossfinancial.com. Literally we we. There's nothing better than to watch a bank succeed, because, as you know, we we both are in this this

01:00:37.340 --> 01:00:53.769

Tom Hershberger: business model. We've hitched our wagon to the success of Banks. So our ultimate desire is, let's go have some really successful banks that creates a future for everybody that's in our company. It also creates a tremendous future for every community served by those banks. So

 

01:00:53.770 --> 01:01:19.179

Tom Hershberger: we want to keep it simple. We want to keep it direct. If you need anything, all they have to do is send me an email. I'll make sure you hear back from us. But the key is resources and doing the right things for the right reasons and avoiding the distractions. Jack, it's amazing how often we talk to bankers who feel like they've just been swamped. They're busy. They can hardly keep up.

 

01:01:19.300 --> 01:01:33.410

Tom Hershberger: And then you ask them about results. And it's like, well, I haven't had much time to think about that. I'm just well. Let's do all that busy work and all that hard work for a very particular reason, and then hold ourselves accountable for the outcome. We'll get there.

 

01:01:34.330 --> 01:01:48.849

Jack Hubbard: Tom Hershberger. Thank you so much for your time. I appreciate it. And see this sign back here. My wife framed that because I took it off of the wall at graduate school of banking, and I would have to come back to you and say, I'm really blessed to know Tom.

 

01:01:49.095 --> 01:01:49.829

Tom Hershberger: I think so.

 

01:01:49.830 --> 01:01:50.690

Jack Hubbard: Your time, Tom.

 

01:01:50.690 --> 01:01:54.254

Tom Hershberger: Yeah. Wonderful friendship. Appreciate it a lot, Jack.

 

01:01:57.230 --> 01:01:58.910

Jack Hubbard: Okay, we're good.

 

01:01:58.910 --> 01:02:00.350

Jack Hubbard: Cool. Thank you.

 

01:02:00.350 --> 01:02:03.690

Jack Hubbard: You betcha, mate, you bet that's great. Yeah.

 

01:02:03.690 --> 01:02:10.230

Tom Hershberger: Yeah, I appreciate it. Well, good to see you, and give my best to Kyle and best with Gsb.

 

01:02:10.380 --> 01:02:14.560

Tom Hershberger: Will do, man, I'll I'll keep you in the loop every once in a while. I'm gonna want to bitch about something.

 

01:02:15.012 --> 01:02:16.820

Jack Hubbard: I'm here. I'm here.

 

01:02:17.230 --> 01:02:18.190

Jack Hubbard: Thanks, Tom.

 

01:02:18.190 --> 01:02:19.819

Tom Hershberger: All right. Go swing some clubs.

 

01:02:19.820 --> 01:02:20.910

Jack Hubbard: See you, Buddy, bye.