Shouldn’t loyalty work both ways?

It’s coming up to the end of the tax year in UK so banks and other financial institutions are encouraging their customers to take advantage of products with tax breaks.

I got a letter from the Building Society  have been a customer of for approaching 40 years suggesting that I use my ISA [tax-free saving scheme] allowances before the end of the tax year. They highlighted the returns that I am getting on my scheme and enclosed a brochure with details of their current schemes. I was shocked to find that the rate of interest for new customers was almost 6 times that I was getting – so much for loyalty.

Obviously I can transfer but it needs me to take action – surely a customer focused organisation would ensure that their most loyal customers always get the best possible deal. I know I do that for my customers.

It seems to be becoming more prevalent to treat loyal customers badly – the best customers get the worst deal.

I’ve noticed similar issues with:

  • Utilities
  • Communications providers
  • Insurance companies
  • Mobile phone companies

This flies in the face of the advice I give my customers on developing their businesses – focus on the 3Rs:

  1. Repeat Business
  2. Referrals
  3. References

I strongly recommend that you treat your most loyal customers well – especially in the good times: if you want them around in the tough times!

What do you think?

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Comments

  • Ian  On February 17, 2011 at 6:31 pm

    Jim, that’s so true. That’s been the point of the nationwide (I think) adverts of late. They guy goes in after seeing a high interest rate being offered, but is told that’s only for new customers, to get them hooked.

    I had the same problem recently with car insurance and I think they rely on complacency to keep their customer base.

    • Jim Yates - Fulcrum UK  On February 17, 2011 at 10:46 pm

      Thanks Ian

      They are better than most in that they allow existing customers on to the best deal but they are still not as good as they should be because they don’t tell you when your account is being superseded by a better one. They wait for you to find out yourself. I’d contend that this still is not looking after your loyal customers.

      My last car insurance renewal would have been three times the cost with my then insurer than the one I ended up with!

  • Lindsey Harrison  On May 6, 2011 at 4:57 pm

    Not to mention in these straightened times it’s so much more expensive to recruit new customers than to keep the old ones.

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