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A software company, a bank and a telco walk into a bar … (Part 2)

April 14, 2016

angry_girlAn article in today’s Sydney Morning Herald about corporate culture in the banking industry (‘How bad behaviour gets overlooked in banks’) reminded me that I needed to write Part 2 of my post on sales and marketing in the digital age. (If you haven’t read Part 1, you can read it first here.)

The SMH opinion piece covers the recent trend of illegal and unethical behaviour in the banking sector and cites research from Macquarie University conducted anonymously with more than 30,000 staff from Australian and Canadian banks. Employee payment structures were seen to “encourage a short-term focus and even unacceptable behaviour”. The author concludes:

“That suggests banks need to put less emphasis on paying their workers by how much revenue they bring in, and more on how customers are being treated. Sounds like common sense, really.” (‘How bad behaviour gets overlooked in banks’, smh.com.au, 14 April 2016)

That’s a great sentiment, but rewarding staff for customer satisfaction and service is difficult in this digital age where face-to-face and human interactions are being driven down to reduce the cost of service.

In fact, there are very few opportunities for me to experience what we once knew as customer service with my bank. Most of my day-to-day banking is done online, and my local branch was recently converted into a series of ATMs, completely closing down over-the-counter teller services.

Companies harp on about customer retention, cross-selling and up-selling, but that’s very hard to achieve when the level of service in many industry sectors is hard to differentiate from the competition.

My bank and my telco both call regularly wanting to talk to me about the service I am currently receiving, which is a thinly veiled attempt to cross-sell and up-sell. Instead, maybe they should be focusing their efforts on keeping me as a customer.

It’s commonly accepted that the cost of acquiring new customers is far more expensive than retaining existing ones. I’m not sure what sort of research has been published around this, and it would vary industry by industry, but I wouldn’t be surprised if the cost difference is up to tenfold.

Why then does there seem to be such a focus on acquiring new customers? I’ve been a customer of both my bank and my telco/ISP for more than 20 years, but I’ve never been rewarded let alone even recognised for my loyalty. Instead, what I see from these companies are offers to the market to entice new customers with contracts, interest rates and terms that are often far more attractive than mine. So the only thing tying me to my current providers is a combination of contract terms and sheer laziness.

That said, the icing on the cake with regards to poor treatment of loyal customers has to go to the unnamed software provider from Part 1. An offer for 10 free stock photos popped up in a notice from one of its products that I was using, which I thought was a nice touch to reward me as a subscriber. What I discovered instead was that it was conditional on me signing up for a one-year plan (the ‘free’ offer being the first month refunded once you signed up).

Now this is a perfect approach to acquiring new customers, but what sort of impact does it have on existing customers of its other, linked products? How hard would it have been to put together a ‘no strings attached’ free offer for existing subscribers?

To me, it has devalued the relationship that I thought I had with the company, a feeling that has also been replicated in most of my recent dealings with my bank and my telco.

When the vast majority of human interactions are sales calls not customer service, your company has a problem. And that’s becoming a reality for many organisations now that so much of their service process is online and automated.

So what’s the answer? We’ve achieved too many productivity, efficiency and convenience gains to return to the days of old-fashioned customer service. (Who wants to go back standing in a queue at the bank to transfer money?) Instead, we have to do something that makes our customers feel good about us. We could just start recognising and rewarding our customers for their loyalty. We do it for long-serving staff, so why not for long-serving customers? It could be something as simple as sending a nice pen and thank you note in the mail, a gift card, or a special discount rate or bonus on an existing service.

Whatever it is, it needs to be seen as authentic, generous, unsolicited, spontaneous or altruistic. Then your customers might actually start loving you again.

(Pictured above: “Angry Girl“, by jasonippolito licensed for re-use by Creative Commons Attribution 2.0 Generic (CC BY 2.0))

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