When it comes to customer satisfaction, how are the retail banks faring? Here, Karen Wheeler, Vice President and Country Manager UK, Affinion, shares some good news for the industry – and considers what more they can do to stand the best chance of keeping customers loyal…
After nearly a decade of berating the banking industry for the global economic crisis, it is good to see the latest results of the Institute of Customer Service’s (ICS) Customer Satisfaction Index name banking as one of the highest ranking sectors for excellent customer satisfaction.
To create the index, 245 organisations were rated by more than 10,000 consumers and First Direct, pioneers of easy banking, ranked second overall, just behind Amazon. Halifax, Santander, The Co-Operative, Nationwide and TSB were also highlighted as leaders of customer satisfaction. And banking was one of just a few sectors to gain more than one point on the Index – a notable achievement.
Watch out for the new kids on the block
While this is welcome news, it’s vital that traditional banks keep the spotlight on customer satisfaction because there is growing competition from a number of digitally-savvy challenger brands. Many of these challenger banks are making customer experience their unique selling point. For example, Monzo Bank says they want to “make the world a better place and change people's lives”; Metro Bank says “everything we do is focussed on making your life easier” and Atom, the UK’s first bank built exclusively for mobile, claims to be “redefining what a bank should be, making things straightforward, personal and great value.”
These challenger banks tend to be more agile, not held back by antiquated legacy systems and bureaucracy and are clearly “making a play” for customers that are open to switching. However, never let it be said that technology is fail-proof. Monzo was recently hit by service outages which prevented consumers from making card payments. This goes to show that no bank, whether a high-street stalwart or a millennial-focused digital bank, is immune from challenges, and both need to do all they can to nurture their customer relationships.
Satisfaction leads to loyalty and advocacy
A comparison between current account gains and the ICS’s customer satisfaction index suggests there is a relationship between high levels of customer satisfaction and gaining current accounts.
So how exactly is customer satisfaction nurtured? The ICS report noted that complaint handling, over the phone experiences and getting things right first time are key differentiators between the top 50 organisations and the rest of the companies in the index. However, we have also noticed that as a customer moves towards recommendation, emotional elements such as enjoyment, absorption, moments of truth and sharing play a much more significant role.
This insight provides a hint of how banks can strengthen the bond they have with their customers. It is crucial they consider how they can make a customer’s life easier, thinking outside of the box and offering additional services, products or experiences which will really benefit the customer.
For example, if a customer has a current account, what else can the bank offer them? Could they offer cyber protection solutions to keep customers online identities safe, additional travel insurance policies or improvements for the home? Our Connected Consumer research shows that a key way to deepen customer relationships and satisfaction levels is to increase the number of products that a customer has with a particular brand so that they engage with the company over multiple areas of their life.
Energise the in-branch experience
In addition, traditional banks need to learn from the approach of the disruptor brands and make the banking experience more memorable. Research shows that customers still appreciate face-to-face conversations with bank employees, especially when it comes to opening a new account. When customers do come in, which is increasingly less often, banks need to capitalise on this and make the experience unforgettable, valuable and relevant.
One good example is Virgin Money, which last year announced it was opening a ‘game zone’ in its Sheffield branch, with bowling alleys, table football, and a children’s play area. In a statement, Chief Executive Jayne-Anne Gadhia commented, “We wanted to create somewhere people could come together and enjoy each other’s company.”
Maximising all channels
Just over a third of customer experiences now take place through digital channels such as online, via an app, email, social media, text or webchat so this demonstrates the importance of having a robust omnichannel strategy. But just having an app is not enough – banks need to offer something different in a digital age where we are accustomed to a cycle of upgrades and improvements.
For example, Lloyds, Halifax and Bank of Scotland are all experimenting with biometrics in the security process, allowing consumers to log on to their online accounts by taking a photo. Alternatively, Atom has also tapped into customers’ expectations for personalisation; letting its customers choose a logo, name and colours to make their app experience unique. By allowing customers to adapt the interface to suit their preferences, Atom claims to “celebrate your individuality in every way”.
Banks need to avoid seeing the channels in isolation and instead create valuable interactions across all platforms that engage, satisfy and surprise consumers – offering them added value options which touch multiple areas of a customer’s life.