At last, it seems the banks are following the lead set by other
high street traders and getting into rewarding customer loyalty, with
Barclays and Lloyds leading the way.
We fear, however, that they may be falling into the trap outlined in our
Focus on page 16; that of hoping a card or scheme will in itself
generate loyalty, rather than simply rewarding loyalty which has already
been earned with excellent products and service which the customer
values more than points or prizes.
The fact is that banks have traditionally enjoyed very high levels of
customer loyalty, simply because the trauma of moving a bank account and
all its associated services was so great that most customers would
endure almost any indignity to avoid doing it.
But time is running out for this form of ’distress loyalty’ as more and
more financial services operators offer telephone banking schemes, which
put an end to the chore of visiting branches and filling in endless
Soon moving a bank account, or switching credit card providers, will be
as painless as picking up a telephone and giving a few simple
When that happens, the banks must rely on genuine customer loyalty and,
as we’ve said on these pages so often before, that’s going to mean
continuing improvements to the core product.
Fortunately, there are encouraging signs of change. Telephone banking,
with all its convenience, is being embraced, and branches are starting
to look less like government offices and more like places we might
actually want to visit.
Financial products themselves are becoming more varied and attractive,
with help from government policies encouraging all of us to take more
responsibility for our own financial futures, and there are signs that
in the traditionally stuffy boardrooms of banking the value of a strong,
flexible brand is at last becoming widely recognised.
What is needed now is for the banks to embrace not just the form of the
supermarket chains, which are leading the way in customer service, but
their content as well.
What about a ’one in front’ scheme in bank branches? It’s only by
addressing those basic customer gripes, like seemingly endless queues,
that banks will ever generate the sort of customer loyalty that doesn’t
disappear when a better offer comes along.