First it was the GFC, now it’s the BRC (Banking Royal Commission)! Big banks are well adjusted to the world of reputational crises, but what will it actually take for customers to jump ship?
In the ever-changing world of customer relations, gone are the days when bad feedback can be left out of the “suggestions box”. Now, even the smallest issue with customer service can be broadcast to the world with just the click of a button. Reputation is everything and ensuring customers are happy will keep the doors open.
So why are the big banks seemingly off the hook when it comes to customer satisfaction?
The answer, put simply, is greed as big banks can afford to spare a few customers here and there to bad experience. As banks around the world are dragged, kicking and screaming, into a reputational rebuilding phase the question of business continuity is often considered. How much backlash, or how many complaints warrant drastic change? And what will it actually take for customers to leave their current bank for a new one?
A CEO stepping down from their role makes little difference to the average person’s bank account. Yet news of poor customer service, one-sided loan agreements, miss-selling of products, or hidden charges is another story.
The BRC has catapulted the following customer service issues into the spotlight, but are they really problematic?
1. Managerial reputations: changing of the guard
Executives stepping down due to managerial misconduct is unlikely to trigger the loss of mass customers; What can change, however, is a customer’s likelihood to take up new services such as credit cards, large loans or purchasing a loan through a third party, without knowing the facts. Customers are now more likely to read the fine print before committing whole-heartedly to a new ‘deal’ offered by a customer service representative.
2. Flaws with third party arrangements
Commonwealth’s recent scandal of signing up customers for loans through third party brokers, has raised a few flags. Customers will now be more alert than ever, and less likely to trust offers not provided directly by their bank. We will be interested to see the impact this may have on customer trust and confidence.
3. Fees? What fees?
The recent news of AMP deliberating charging unlawful fees to customers then lying about it to ASIC was a particularly low point for the BRC. What makes it worse for AMP customers is that they falsely promised the error has been fixed. Most customers will expect to pay fees, but this revelation will certainly make customers sit up and pay attention to their monthly statements to ensure they are not subject to dodgy practices.
So, what does the future hold for big banks?
Realistically it is going to be more of the same, with most banks keeping their heads down until this all blows over and the media moves on. There may be some regulatory changes to prevent future instances of corruption and misleading customers, however such changes take time.
What hope to see more accountability, transparency and genuine customer care. Maybe the BRC has provided the perspective needed for the banks to realise businesses have a responsibility to their customers, and not the other way around. While the banks aren’t off the hook, customer satisfaction will continue to emerge as a primary concern for big business. Because, if not adequately addressed, poor customer service will continue to have business-limiting ramifications.
If you’d like to know more about managing your reputation or like to proactively plan ahead to protect yourself from a business crisis, we’ve love to chat! Give us a call on (07) 3221 2220, or simply comment on this article, we’d love to hear from you.