Consumer banking is a very competitive industry. Banks battle for market share with advertising, free gifts, lower charges, higher interest rates and more.
So much energy and expense are spent attracting new business. But so little effort is invested in truly appreciating the customers they already have by taking steps to improve customer loyalty.
For example, have you ever bought a house with a housing loan? After you moved in, did the bank call to ask about your new home, or send you a housewarming gift? Did it do anything to improve customer loyalty?
Have you ever purchased a car with a car loan? Did the bank send you a note afterwards to congratulate you on your new car, or send you a friendly coupon for a free car wash and wax?
Do you have a credit card? Does your bank ever call you just to say “Thank you” for using the card and ask if you are happy with the bank’s service? Did it seem to care about taking steps to improve customer loyalty?
At a bankers’ convention I asked if anyone in the audience of 3,000 routinely called their customers just to say “Thank you!” The answer, predictably, was “No.”
The bankers were stunned by their own admission of a lack of efforts to improve customer loyalty.
“Relax,” I said. “None of the other bankers here are doing it either…not yet.”
Most banking customers have accounts at more than one bank. You probably do too.
What would it take to get you to consolidate most of your banking activity to one bank? A free gift, slightly lower charges, or a higher rate of interest?
Not likely. Those incentives exist today and you still have multiple banking accounts.
But if one bank started genuinely thanking you, calling you, truly listening to your thoughts and suggestions about their banking service, would you be more inclined to rely on that bank in the future? To use them again and again? To migrate your accounts to that one bank for more comprehensive service?
What would it cost the bank to make those telephone calls to you and improve customer loyalty? Not much. What might it earn the bank? A lot.
Key Learning Point To Improve Customer Loyalty
Picking up new business is important, but it can cost a lot in advertising, special discounts, promotions and new customer orientation. Increasing your business with existing customers magnifies the loyalty of those you already have, and substantially boosts your profits. Improve customer loyalty and everyone wins.
Action Steps To Improve Customer Loyalty
Pick up the telephone. Write a letter. Send out a few “free gifts” – not to the new customer you’ve just signed up, but also to the loyal customers who have been with you all along. Little measures can improve customer loyalty.
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Copyright, Ron Kaufman. Used with permission. Ron Kaufman is the world’s leading educator and motivator for upgrading customer service and uplifting service culture. He is author of the bestselling “Uplifting Service” book and founder of Uplifting Service. To enjoy more customer service training and service culture articles, visit www.RonKaufman.com.
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