Impact of poor service on customer
retention
Banks invest heavily on campaigns to
attract new customers, but keeping existing customers
depends more than ever on service quality, customer
satisfaction and loyalty. Often, the hard work
attracting and developing new customer relationships can be
destroyed if that customer experiences a problem or concern
that isn't quickly resolved. This business risk
often remains unseen because a traditional approach to
measuring customer satisfaction often fails to show the
impact of poor service on the bank’s profitability.
CTMA's national study estimated that the problems
customers experience when banking, and the way many banks currently handle customer complaints, may be
placing between 8% and 12% of their annual profits at risk.
The study presented participating banks with
valuable insights into their relative strengths, and
identified specific opportunities for improvement.
In subsequent annual updates, two disturbing
paradoxes have been observed:
-
Although
customers of some banks report fewer problems, overall
satisfaction and advocacy appears to have dropped.
-
When problems
do occur, there appears to be an increase in the
percentage of customers contacting their bank for help,
but a drop in satisfaction with the action taken by
banks in response.
It appears that although most banks are
attending to service quality improvements, customer
expectations are increasing. And, when customers go to their
banks for help, the problems are often not resolved to the
customer's satisfaction. |
