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Monday, October 31, 2011

Banking industry prepares for a showdown

Earlier this month, I mentioned the changing landscape of banking… and specifically, how some banks are adding fees to services that were once free (see “Is your bank worth $5 a month?” from 10/14/11). 

According to this story from the Washington Post (click to link), banks like Chase and Wells Fargo are abandoning test programs to see if their customers would tolerate a fee for debit card services.  Meanwhile, a Facebook movement called “Bank Transfer Day” is gaining momentum on Facebook, and the Credit Union industry is planning to pounce on the opportunity, according to this article from today’s Marketing Daily.  (If you haven’t heard about the movement, you can read this background story from ABC News.  The date is set for November 5.)

Implications:   That large banks suffered a backlash from the great recession is not news.  What might be newsworthy is the idea that the backlash continues, even after so much time has gone by.  (Remember, the recession technically ended around June, 2009.)  The additional fees that Bank of America has applied may have stoked a fire that might have otherwise not erupted.   

So, if the pendulum has swung away from Goliath and toward David in the banking industry, are you seeing similar trends in your category?  Is smaller better?  Does your local company hold a customer-attentiveness advantage over a larger rival?  Good questions to ask at a time like this.

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

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