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by Sudam Chandima Kaluarachchi, Union Bank of Colombo Ltd

Two decades ago, the branch manager of a bank was a king. He was in a room with a closed door and only a few customers had seen him for their life. The manager's room was separated from the customer services area and located most probably in the first or second floor of the bank building. He hardly smiled and always expected worship from the customers. He was a man who had never realised that he was paid out from customer's money.

By the time banks grew fast, customers grew faster than the banks. Today the branch manager has become a beggar before the customer. Customer has become the 'King'. As a banker, I believe that 5 per cent of these kings are 'gods'.

Who are these 'gods'? What do they expect from the bank? Why are they important to banks?

Most of the customers of a bank are neutral customers. We, as bankers, call them kings. They satisfy themselves with the products and services offered by the bank. A particular bank is selected by them as their own bank for fulfilling their financial needs.

The attitude of these customers towards their own bank is always positive. Whatever the service, whatever the product, whatever the banks; pricing strategy is accepted by these customers without questioning. I have a strong feeling that these customers are less informed and have a little knowledge on the financial world and competitors who provide the same product and services which customers need. Due to this reason they do not question about, for instance, the interest rate for deposits, lending rate or time taken to complete a transaction etc.

They might think that whatever the service they get from their own bank is the best available service in the market. Bankers view them as cool customers and like them very much. 95% of the bank customers easily come under this category. So I can say that 95% of the customers of a bank are kings. This is true even for corporate customers except for multinationals or blue chip companies which are always seeking a better service and pricing.

What about the balance 5 per cent. They are the customers who always have a question to ask. I believe that these customers are the 'gods' of a bank. They are well-informed customers. They always inquire things and argue on things. They always suspect the banker. They might think that they are not given the best interest rate in the market, are charged exorbitantly with higher lending rates etc. They are the people who always assume that other competitors (banks) provide a better service than their own bank. Unfortunately most of the bankers view at these customers as problematic or nuisance customers.

I personally believe that this attitude is not good and acceptable. It must change if the bank wants to survive in the long run in this competitive market.

Expectations of bank customers

The future of banks will be based on expectations of this 5 per cent of customers. Today, bankers' main responsibility should be keeping these customers delighted in the same way they do for 'kings'. Not like 'kings' these 'gods' do not satisfy themselves or they cannot be satisfied easily since their expectations are higher than the 'kings'.

It is a difficult task which all bankers should clearly understand. It is important to study the expectations of these customers in deep. Since these customers always have a question to ask, they can only be satisfied by providing:

1. Unquestionable financial products

2. Unquestionable pricing

3. Unquestionable delivery system

4. Unquestionable service

Products are not questionable if they are designed with features which provide desired benefits to the target market. Products are beneficial and accepted if they are produced to satisfy customer wants and needs. Customer wants and needs could be identified through a marketing research. Price is not questionable if it is reasonable and competitive. Delivery system or distribution is unquestionable if the customers can easily reach the points of sales (POSs) and get the things done.

Two important elements can be identified by analysing the above factors.

1. Product, Distribution or Service is a cost which should be borne by banks. Price is the only thing which brings revenue to banks.

2. Product, Price or Distribution (Place) is something which is not involved with common sense. Customer service is the only thing which ties up the customer with the bank since the customer service is done by people. It is a matter of common sense which is not common in the society.

Importance of customer service

Features of products, prices and pricing strategies and distribution patterns and structures can be copied, changed or matched easily by competitors. But customer service is something unique to the people who deliver it. If the customer service is unbelievably good, customers will easily forget the other set backs. Promising less and delivering more will delight customers. Bank staff must have the knowledge, talent and skill for this task. These skills can be acquired through learning.

The subsequent example will illustrate how a staff member bounced back a customer who was frustrated due to an incorrect entry in his monthly Credit Card statement.

The customer started his banking relationship with the bank by opening a savings account (S/A). Then he opened a current account (C/A). After which he was offered a Credit Card (C/C) by the bank. Finally he got a loan from the bank to purchase some home appliances.

At this stage the customer was very happy about the products and services offered by the bank. Then he saw the incorrect entry in the statement and because of this, his perception on the bank changed. But a staff member who visited this customer personally and handled him professionally to re-change the perception of the customer.

Here the customer service has recovered the bank from the damage. Service recovery has increased the customer loyalty level. By offering something unexpected (eg. a gift) to the customer, the satisfaction level can be enhanced even above the old level of satisfaction. This clearly shows the importance of good customer service.

I will take a cash withdrawal made by a customer from his account to give same to his son as an example to explain this concept. The basic of this transaction is the customer goes to the bank branch in the city 2 km away from his home to withdraw money and gives same to his son. He expects this bank branch to be located in near by road since it is easy for him to get there without much effort or wasting much time. He desires to withdraw money from a nearby ATM without walking into a branch.

He will be surprised when he hears that he can transfer money from his account to his son's account through Internet, telebanking or wireless banking at his residence while listening to music. He will not believe that bank officer visits his place with money and hands it over to him and gets his signature on the withdrawal slip and talks about his other needs and wants.

This is the positive unbelievable service which will delight customers and retain the customer with the bank.

On the other hand, if he has to travel 10 km all the way from his home to a bank branch and stand in the queue for 30 minutes to withdraw money or he often experiences that nearby ATM is out of order, that is the negative unbelievable service which will cause customer dissatisfaction and he will then decide to leave the bank and tie up with another bank.

Customer demands

More emphasis on people, process and physical evidence of banks. Well educated and skillful people, reliable and quick process and attractive and trouble free surrounding will increase the quality of service.

Each and every Department of the bank to take part in customer satisfaction process. Well blended marketing mix i.e. product, price, place and promotion.

Be competitive in the market and maintain consistent quality of all the transactions.

Safety of deposits, freedom and convenience.

Importance to banks

It is my experience that the percentage of 'Gods' is drastically increasing every day in the bank's customer base. So we should understand how important this type of customers are to the bank.

They are important to a bank because:

They are, in general, valued customers who give business to the bank.

They are information sources with valuable information on the competitive market, micro and macro environment.

Their complaints will lead the bank to re-think of the strategies and policies. This will help banks to improve their goods and services more and more. Because of their inquiries bank staff also can learn different issues and they always try to gather information through additional reading, doing information surveys etc.

As the result of the pressure created by these customers the best possible customer service is always available for customers to enjoy.

Bank can get feedback about their products and services.

Feedback will help to rectify any mistakes (if any) and areas need improvements.

Therefore all banks should try to keep their customers delighted by providing unbelievable customer service which will improve the customer loyalty.

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