Measure How Loyal Your Members Are

People who are pleased with your credit union's service will promote it to others and increase their wallet share with you.

Even companies with significant research budgets like eBay, Apple and Zappos rely on the simple Net Promoter Score to increase wallet share and generate positive word-of-mouth, said Michelle Bloedorn at the American Credit Union Mortgage Association conference recently.

Everyone knows if you have a great experience, you’ll have a good outcome, Bloedorn says. Promoters are people who buy more from you, who’ll share feedback with you so you can get better. Detractors aren’t buying from you. They’re calling your call center and complaining a lot.

Net Promoters Scores, which range from -100 to +100, reflect how likely customers are to recommend your credit union based on how pleased they are with your service. In the financial services industry, USAA ranks the highest with a score of +83, with the next highest institution scoring +43. Credit union leaders who know their Net Promoter Score can use it as a management tool to determine how loyal its member base is. In general, younger members are less satisfied because they expect more convenience and newer members are less satsified because they are still forging a connection with you.

In Las Vegas, Zappos, an online retail company that prides itself on over-the-top friendly service, uses five questions to gauge its Net Promoter Scores, then it posts the scores on a dry erase board each week to encourage employees to strive for stellar service. When ACUMA attendees toured the Zappos headquarters, last month, the company was landing Net Promoter Scores of more than +93.

Zappos tracks how its service
is connected to consumer satisfaction.

The Net Promoter Score may be more useful than other customer satisfaction indexes, which are weighted, and can serve as an easy operational measure that can help hold staff accountable. Credit unions can measure both relationship feedback, which is a periodic pulse check of your whole membership, and transactional experience feedback, which is daily monitoring of a particular new product like mortgages. Many credit union executives at ACUMA said they are indeed regularly measuring their transaction satisfaction, which tends to be higher than relationship scores.

Member satisfaction does not necessarily equate to member loyalty. Credit unions must also differentiate by creating a wow factor by either delivering ordinary services and products delivered exceptionally or exceptional services and products delivered well. Few credit unions have exceptional products, so they must focus on exceptional service to achieve a high Net Promoter Score, Bloedorn says.

Credit union members with mortgages tend to generate much higher Net Promoter Scores and have deeper ties to the credit union. Members who have a mortgage generate an average Net Promoter Score of +71, while those without a mortgage generate an average Net Promoter Score of +62, according to the Member Loyalty Group. About 85% of members with a mortgage have a checking account with their credit union, compared with only 70% of members who have checking accounts overall.

When it comes to the mortgage application process, however, credit union members report that this is one of the least satisfying service experiences, mainly because members expect a faster service and ongoing communication, oftentimes more than the credit unions can deliver.

They only have a mortgage experience once or twice in their life, Bloedorn says, explaining why members may expect more. And they’re comparing your service to Amazon, Google, even Dominos. Promoters can still be promoters and be mad.

One credit union in attendance said her credit union recognized that members do expect more out of the mortgage process so the credit union created a document called What to Expect, When You’re Expecting a Mortgage. Credit union members feel more valued if you to tell them in detail what’s going on in the process, so if you can’t process a mortgage quickly, try to keep members posted on where you are in the process.

May 28, 2014

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