Thanks to the Consumer Financial Protection Bureau (CFPB) and its handling of consumer complaints, banks are increasingly focused on where they stand in this public database. Unfortunately, this only represents a small sample of what might be going wrong: most customer problems are never escalated to the CFPB. Sadly, many of the reported problems never would have reached this level if banks had done a better job with their internal problem resolution process up front.
According to The MSR Group’s National Banking Study, about 8% of American banking consumers say they’ve experienced a problem or issue with their bank in the past three months. While this may sound like a small group, the impact these problems can have is much further-reaching.
To start with, over a third of customers who reported a problem are still waiting for resolution. This doesn’t seem that unusual when noting that it took banks an average of 15 days to resolve problems for the customers surveyed. Making matters worse, customers had to contact their bank an average of 2.2 times during the process.
A problem in and of itself isn’t necessarily a bad thing—a study by the White House Office of Consumer Affairs shows that happy customers who get their issue resolved tell 4-6 people about their experience. But what about when things don’t go that smoothly? A dissatisfied customer will tell their story to 9-15 people. Around 13% of dissatisfied customers tell more than 20 people. With the number of times customers have to call about their problem and the length of time it takes to get resolution, banks are creating a growing pool of unhappy customers.
Our study found that once their issue has been addressed, about 8 out of 10 customers say they are either very satisfied (38%) or somewhat satisfied (42%) with the resolution. About 6% remain dissatisfied. However, don’t forget the group who is still waiting to have their problem addressed—and becoming increasingly upset.
One way to examine how customers feel about their bank is The MSR Group’s Net Advocacy Rating (NAR®) metric. NAR® measures customer likelihood to 1) recommend a company to friends and colleagues, and 2) do additional business with that company in the future.
The NAR® among customers who have experienced a problem in the past three months is -26.7, which is about 68 points lower than the NAR® among customers without a problem (40.6). How the bank handled that problem makes a big difference, though: the NAR® among those who report that their recent problem has been resolved is -10.9, while those who are still waiting for resolution have an NAR® of -55.9.
Customer problems are unfortunately part of doing business, but how well are you managing them? Identifying and eliminating common problems is an important step in building NAR® among your customer base. When problems do occur, making resolution as quick and painless for the customer as possible turns these situations into service recovery, not service disasters. Problem resolution tracking systems can help you with both. Having a solid system in place helps you maximize first call resolution and monitor progress to ensure none of your customers fall through the cracks.
Salvage your customer relationships and ensure they have positive stories to share about how well you addressed their needs.