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Are Banks Too Big To Care?
Financial institutions should figure out a way to appropriately compensate disgruntled customers.
For the rest of the October 2015 issue of CRM magazine please click here

When organizations fail to deliver on customer expectations, it's common to offer the offended clients or customers appropriate compensation. If a restaurant employee goofs, a customer might get a free meal or dessert. If a hotel bungles a customer experience, it might offer a free upgrade or a complimentary room. In publishing, there’s even a term for it, a "make good," in which publishers compensate advertisers for shortfalls in contracted ad impressions.

But not all industries do this, at least not adequately. For example, I haven't encountered anything like this in the banking industry. If a bank employee makes a mistake that upsets a customer, should the financial institution figure out a way to appropriately compensate the disgruntled customer? If so, what's an appropriate compensation?

In August, my wife and I had an excruciatingly bad series of customer service experiences with our bank. Normally, I pay our bills online, but during a conversation with a representative about a separate issue, she offered to process a payment for me. I accepted. Unfortunately, she processed the payment incorrectly, which later triggered a series of time-consuming, aggravating, and even infuriating customer experiences.

After several failed attempts by different bank employees to resolve the issue, a call center manager finally figured out the original employee error—and the subsequent mistakes made by other agents—and assured us that we would not incur any penalties because of them. She even suggested the bank could learn from these miscues by turning them into training and coaching opportunities. I was relieved that the problem was finally resolved, thankful we didn’t incur any fees, and even encouraged that these experiences could be used for training purposes.

However, while these are positive outcomes, none of them did anything to address the aggravation that my wife and I endured. The bad experiences still left us with a negative brand impression.

By doing nothing to address this, the bank is leaving it up to my wife and me to change our perceptions of its brand. Will we get over these incidents? Maybe we will. Maybe we won't. That's a risk the bank is taking. And with other banks competing for our business, and offering compelling reasons to switch, it's a pretty big risk.

Let's say, however, that our bank wants to be proactive in its retention efforts and attempts to compensate us for the aggravation. What would be an appropriate offer?

I'm not even sure if financial compensation is the answer. Can a company effectively put a dollar value on customer aggravation? This is difficult, because the judgment is too subjective to adequately please everyone.

Perhaps banks should explore other options that are tailored to each customer, such as a free consultation with a financial planner over the phone or at a local branch office. Based on a customer's life stage, income, savings, debts, and a few other factors, the bank could put together a personalized portfolio of banking options (such as a credit card, a 529 plan, a loan, or a retirement plan).

However, the discussion has to be consultative, and not a sales pitch. The financial planner should ask questions that enable customers to address their biggest financial concerns at that time. And the bank employee should be ready to offer solutions that can help customers achieve their financial goals.

If the customer accepts one of the bank's offerings, it's a win-win situation. If the customer doesn't select a product, the conversation still sends the right message—that the bank cares about its customers' financial well-being. Either way, it's a chance for the bank to repair, and even strengthen, that customer relationship.

If you have other solutions, feel free to email me your suggestions.

Editorial Director David Myron can be reached at dmyron@infotoday.com, or at @dmyron on Twitter.

 

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To contact the editors, please email editor@destinationCRM.com
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