Digital & Social Media

Banking on Customer Frustration

Banking on Customer Frustration
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CAMPAIGN

First National Bank (FNB), the retail arm of South Africa’s largest banking group, First Rand, lost customers in both 2013 and 2014 – the only one of the country’s big five banks to do so.

To reverse this trend, the bank turned to its extensive network of ATMs – a costly service for any bank to run – and decided to use them as a way to secure new customers. Working with Ogilvy SA and Gloo Digital Design, the bank timed tactical ads to appear on screen as customers from other banks put their cards into FNB’s ATMs.

Usually in South Africa, customers using ATMs from other banks are charged fees. Most of the time, as there’s no immediate alternative, customers take these charges on the chin and put up with the frustration of extra costs. FNB decided to take advantage of that pressure point by offering non-FNB customers the chance to switch their accounts on the spot.

Tactical copy flagged up FNB rewards, the bank’s commitment to innovation and the fact that switching to FNB would take just 10 minutes. ATM users who wanted to switch could input their contact number directly into the ATM, triggering a call to their mobile phones.

As a result of the ATM advertising efforts, the agency claims that 34,224 people switched to FNB over 11 months, with an approximate customer lifetime value of approximately R 220 million ($17.6 million).

CONTAGIOUS, FLEISHMANHILLARD’S STEPHEN HUNTON WEIGHS IN

Contagious:

Timing is everything. FNB is targeting people at exactly the right moment: When they’re annoyed with their banks for incurring additional charges for using FNB’s ATM. So why not convert this anger into action by converting these people into FNB customers? FNB is showing it’s on the side of the customer by providing a service which their existing banks failed to do.

Overcoming fear of switching. In some countries, it’s becoming more common to switch banks. This year’s Millennial Disruption Index, for instance, showed that one in three US millennials were open to switching banks over the next 90 days. However, switching banks can still be regarded as a daunting prospect in other territories. FNB confirming that it takes just ten minutes to switch accounts – and that you can do it at the ATM rather than visiting a branch – makes it a more appealing, straightforward task.

Long-term loyalty. A survey commissioned by Spanish bank Santander found the average bank account tenure lasts just over 16 years, and that 58 percent of people keep their current account for more than 10 years. If FNB can acquire customers at that frustrating, painful point, when they realize they’re going to be charged by their existing bank just for using an FNB ATM, the long-term benefit to the bank’s bottom line is considerable.

Stephen Hunton:

In an international financial firm’s most recent global banking survey, customer experience was found to be the number one driver in increasing customer loyalty. In today’s age, customers in developed countries have come to expect convenience and security from their financial service providers as basic and minimum requirements. Much of the customer focus now has shifted to how well banks can integrate technology to improve transactions and create a seamless banking experience across a variety of platforms. FNB already has a mobile banking app that ranks among best in the world, but the focus of this particular campaign wasn’t just on improving customer experience, it was driving consideration with potential customers by enhancing their experience on FNB’s home turf.

From a marketing standpoint, FNB’s “ATM Switch” campaign is successful because it is addressing multiple key improvement areas for banks outlined in the aforementioned survey. First and foremost, FNB is being clear about what it offers, the fees it charges and how to avoid paying those fees – one of the most sought-after traits of a financial services provider, according to the survey.

Secondly, FNB is enhancing the problem-resolution experience by solving issues in a way that leaves customers feeling very satisfied. Its approach removes many of the barriers that exist when customers get frustrated enough to consider switching. The survey results revealed that customers often remain with their current financial services provider simply because they feel it is too difficult or time consuming to switch. For this reason, customers are constantly vulnerable to competitive threats, and may switch providers at any time – even if they haven’t articulated definite plans to do so in the past.

Finally, FNB’s campaign demonstrates the power of personalizing customer experience and creating a mutual exchange of value during what is normally viewed as a time of significant frustration. In essence, FNB has turned a point of frustration into a point-of-sale where it can engage potential customers on a one-to-one level. The survey clearly states that it often doesn’t take much for a customer to switch providers at the drop of a hat – or a transaction fee. Simply feeling acknowledged and appreciated at a FNB ATM could very well be the tipping point for a lot of customers from other banks.

Personally, I find the simplicity and relatability of FNP’s ATM campaign to be a thing of beauty. FNB has essentially turned an Automated Teller Machine into an Automated Engagement Platform. Like any successful campaign, its foundation is in sound market research. But practically speaking, it’s amazing what you can accomplish by working with customers and empowering them. I honestly think I would be in complete shock if a representative from my bank proactively sought me out to resolve an issue I was having with their services. Usually, I’m the one seeking out a representative by yelling “Manager!” repeatedly into the phone in order to bypass the automated response system. By offering clear and simple solutions in real-time, FNB is doing something very profound, and I’m not surprised by the success it is experiencing.

*This article was contributed to by Mike Dellaquila (FleishmanHillard).