The latest Banking Benchmarks came out the end of January, and there were clear indicators about overall banking strategies community bank and credit union managers should employ to maintain and grow in their markets. To understand where your bank specifically rates and ranks vs local competitors, be sure to request yours.
The One Factor that Determines Loyalty Above All
The most recent Benchmarks reflect that the most important differentiator community banks and credit unions have is their ability to deliver excellent customer experience.
Out of more than a million reviews, only about one-third of households and business can be classified as loyal. Loyalty is down significantly over the past 18 months.
How Do We Measure Bank Loyalty?
Loyal consumers are those that have given the vast majority of their banking business to just one bank and are planning on giving the vast majority of their future business to the same bank. These are customers or members that, barring any big unexpected problems, are going to be with you for at least the next 5 years. Statistically speaking, it is impossible to predict out longer than 5 years because of vagaries in the economy, people moving, changing jobs, etc.
What Can My Bank Do to Improve Customer Experience?
To improve your community bank customer service experience and generate more loyalty from your bank customers, we recommend this 7-step approach:
1. Compete with technology.
Customers expect even the smallest banks to compete well on technology. It’s an expectation, so if you fall short, you will lose share. But because technology is so ubiquitous, it also cannot be what you hinge your differentiation on. You need it, but you need more.
2. Consistency from every touchpoint.
No matter how your customer reaches you – phone, website, drive-through, walk-in, phone call – every experience should feel seamless and focused. Everyone should be on the same page about your services, and every single person who has any potential of coming into contact with your customers should deliver exceptional customer service and know how to use all of your technology.
3. Make your bank customers feel welcome.
Don’t forget the community in your community bank. When customers do walk in, they aren’t looking for an austere, corporate climate. They want smiling faces and people who know them by name.
4. Your employees should know how to bank at your bank.
As we interviewed thousands of banking customers, we discovered that staff training is typically one of the top reasons that people decide to switch banks. Your staff – all of them – should be able to answer questions and demonstrate a clear understanding of existing technology.
5. Build a culture of customer service.
Nearly all bank managers think they prioritize service, but our surveys reveal that at least a third of customers report getting the runaround. Getting the runaround is a major reason households and businesses tell us they want to switch banks. Customer service has to be a culture in your bank from the top down.
6. Get personal.
What sets community banks and credit unions apart from big banks is that they can compete technologically while still being personal. When your banker is also your neighbor, has kids in the same schools, and understands the challenges of your specific community, it makes a difference.
7. Community involvement.
The customer experience is driven by your involvement in the community. Sponsor local teams and celebrate regional traditions. Reinforce that you are an important part of the community. And take every opportunity to promote what you do. Our surveys show that when a community contribution is accompanied by marketing spend to promote it, the impact to the bottom line can grow by more than 350%.
Want to know the specifics about your bank?
To understand where your bank specifically rates and ranks vs local competitors, be sure to request your benchmarks.