International Bancard puts resources into new ventures, new people, even a new building
By John Manasso
Ten years into its existence, International Bancard is doing its part to help transform Michigan from a Rust Belt economy to a high-tech economy.
In December 2009, the company quadrupled its office space with a new headquarters building in Clawson, Michigan, just 20 miles north of Detroit, with the stated goal of adding 150 jobs. Not long after the move, International Bancard won a request for proposal to run the merchant sales program of Citizens Republic Bancorp Inc., the oldest bank based in Michigan, with more than 218 offices throughout the Midwest.
In the short time since, International Bancard’s top-line growth has improved by 27 percent, according to one high-level company executive.
Along the way, International Bancard earned a worker training tax credit worth $1.1 million over seven years in July 2010 from the Michigan Economic Development Corp. The company’s news release at the time said it would “develop a 40-hour program that will teach the history of the bankcard industry as well as the math behind interchange rates charged by the card-issuing associations and other aspects of what has become a booming financial services business.” The program is administered with the help of a local community college.
Recruiting Quality
In trying to build International Bancard into a powerhouse, CEO David Iafrate recruits in growing Sunbelt states like Texas, Florida, and Georgia, where the payments industry is flourishing. Luring staff is not always an easy feat, considering Michigan’s colder climate. To help recruit and to grow the company in general, Iafrate says International Bancard is investing “very heavily” in itself.
“Not only have we invested in facilities, infrastructure, and technology, but in training for our staff,” Iafrate says. “It’s a very, very big investment. It’s paid off because what that’s done for us is it’s really given our organization a lift, as far as people interested in coming to work here. We’re getting tremendous hits on our corporate website and on LinkedIn. We’re starting to get noticed.
“It’s a long-term deal with us,” he continues. “In this business, there is a lot of churn-and-burn with merchants and salespeople, but we retain very well here. I think it all comes down to putting the time in with an individual and giving people the tools to be successful.”In 2010, International Bancard set a goal to grow by a factor of four over the five ensuing years. The new headquarters building, in which the company invested more than $2 million after moving from nearby Royal Oak, is part of an approach that is both inward and outward.
“When I built this facility out, I had to say, ‘Hey, the kids are graduating from University of Michigan, Michigan State, Wayne State, and I want them to come here and check this out,’” Iafrate says about the cosmetic approach to the building. “So I built something that has polished concrete floors, to give you a visual—very lofty, brick, woodbeams shooting through glass, lounges, just really cool—so that I cater to the ‘X,’ the ‘Y,’ and the baby boomers. I can’t be too off the charts here because I have CEOs of banks coming here, so it kind of caters to everybody. When people come through from the state or out-of-state banks or wherever, they’re like, ‘Wow, this is beautiful.’”
Luring Major Players
International Bancard is also focused on reeling in the big fish. Company executives talk about not only leveraging relationships with high-level corporate executives but also putting forth value propositions that make it impossible for the executives to say no.
Iafrate cites a three-pronged approach that helped the company win the account for Citizens Bank, which has branches outside the state in Ohio, Wisconsin, and Indiana.
The first part of International Bancard’s plan to win the RFP was to put people where the Citizens branches are. “We have an approach where we have district managers in the field that work for us, and, obviously, we have relationship managers on the inside in the call center,” Iafrate says. “That was one of the things—and also our service level.”The ISO instituted a policy where merchants are guaranteed a call back in 60 seconds. International Bancard also invested in software as the final part of its winning strategy.“I think one of the very big determining factors was the real-time visibility of our [customer relationship management] portal system that we built that the bank has access to,” Iafrate says. “Sometimes [the ISO’s software] may not be as visible, so we custom-built a solution off of our main platform to give the banks real-time visibility at a very granular level so they could determine who was contributing to the program.” Iafrate adds that International Bancard is a “very highly technologically advanced company, but we’re kind of under the radar. Companies 10 times our size don’t have systems like this.”
lafrate describes the technology as a “ticketing-based system that lets us track the prospecting and on-boarding functions of a client.” The system then shares the data with the company’s sales partners (agents) and referral partners, and, in some cases, also shares the transaction data with the company’s customers. “It’s really a slick program. And it shows the status as to where the deal is inside of our system at all times, so it’s visible to the entire organization.”
Customizing Solutions
While Citizens Bank has been one of the big targets International Bancard has landed, there’s another. In terms of big-box retailers, International Bancard’s biggest client is Staples. International Bancard designed a “Business Express” program for Staples that made it easier and more affordable for merchants to sign up. That was where the 60-second guaranteed callback came in. Another component was to create video tutorials to walk new merchants through the process of starting up.
“What we’re trying to do is to package a merchant services program up at a point of sale where it normally isn’t available,” explains an International Bancard executive who helped design Business Express. “For example, most people go to their bank when they want to set up a merchant account or they go online. We’re saying, ‘Why wouldn’t you go to Staples?’ When you’re there getting your office supplies and it triggers the thought of, ‘Hey, I’m buying a cash register, I need to be able to accept credit card payments as well. There’s a terminal
here. Gee, it’s a great value, and I can go online and activate the account.’ So it’s just really meeting the consumer where they are with the solution that they need.”
It’s an approach that seems to work.
WORDSTOTHEWISE
Pick a strength. “Be true to yourself, who you are, and what you’re good at,” says one high-level International Bancard executive with extensive experience in marketing. “Stay focused on that. Too many ISOs try to do too many things, and they fall outside their skill sets.”
Don’t get consumed by fads. “Make a plan and work your plan,” says CEO David Iafrate. “I can’t tell you how many times I’ve seen merchant-level salespeople and smaller ISOs get derailed by reading something and thinking, ‘This is the next big wave.’ Focus on and make a plan and execute a plan.” As an example, Iafrate says that if an ISO plans on going after veterinarians, focus on veterinarians. “Be the best you can be,” he says. “Too many people are too scattered and have too many programs and too many ideas, and they don’t have capital to execute on that. I have that conversation with my sales managers every day. I think you’ve really got to come up with your niche. It couldn’t be more true.”
Be innovative. “One thing I think is very important is to think outside of the box,” Iafrate says. “[We] try to make things easy for a merchant to sign up with us. A lot of people are outward facing and don’t look at what the client is facing: ‘Look at me, look at my website.’ Think about the client and client’s needs. What does the client going into the bank want to see?”
Original article @ TRANSACTION trends November 2011 Issue p. 16