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How many customers would leave their bank because of poor service?

Blog
11th January 2018

An excellent recent article in The Financial Brand contrasts how most customers see their experience as a bank customer with other services they use on a daily example. For instance, to paraphrase the original article, imagine a customer who wakes in the morning and checks her personalised online news feed, listens to automatically downloaded podcasts on the way to work guided through the traffic by Google Maps. On arriving home, Netflix has recommended a new movie based on her preferences and Amazon is recommending a new book.

Now contrast all these slick consumer services with your bank. Even if they have an app, it requires several passwords and takes several minutes to login. Visiting a branch is even worse – waiting forever because all the staff is at lunch – yet that is usually the only opportunity for most people to visit a branch in person because they close so early.

Why do companies like Apple, Amazon, Facebook, and Google understand their customers so well and deliver services that are useful and easy to use, yet banks make everything difficult, disjointed, and complex? Of course, the easy answer is that they are dealing with regulated financial services, but many transactions on all these other sites involve cash and yet look at how simple they function. The Amazon one-click service that allows an item to be purchased with a single button click has been around for two decades now!

The NGDATA Consumer Banking Survey for 2017 found that 41% of customers would switch their bank if they receive poor customer service. That’s up considerably on 2016 when 33% of customers said they would move because of poor service. But what is really shocking to see featured in the same research is that 72% of customers believe their bank has not improved their service levels at all in the past year. Most people think that banks are not even trying to improve.

One area of dissatisfaction that really stood out was around personalisation. Over 61% of customers said that they really don’t like receiving offers and deals from their bank as part of a wider marketing campaign. That’s almost two thirds of customers who think that if you send a deal to all customers then it’s just spam. Banks need to get much smarter in their messaging to customers to ensure that offers and product recommendations are personal and relevant.

Millennial dissatisfaction with banks is even more profound. When asked which brands really understand their needs as a customer, 41% of 18-34 year olds said Google. 23% said their streaming video service. Just 19% said that their bank understands what they need. This should be a wake-up call for banks across the world – Netflix understands your customers better than you do.

The message is that banks need to analyse the data they already have so they can demonstrate a better understanding of their customers. There is no need for a quick rush to new technologies such as Artificial Intelligence when most customers don’t believe the bank can even send them a relevant offer by email.

Get to know your customers better. Start personalising your interactions and ensure that interactions are relevant and helpful. Customers expect better – more personal – service today and they know that you have their transaction information. The excuses for not treating customers as individuals are wearing thin. What do you think? Leave a comment below or contact me on LinkedIn and let me know.


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David Turner
Article by: David Turner

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