A Moment of Truth?

Felix Thomson

Content Executive

The Financial Services Forum

Influencing customers’ perception of a bank is crucial to the development of loyalty and good relationships. Doug Wilson looks at how this can be achieved.
In recent years, considerable focus has been given to the concept of Moments of Truth. Whilst there are different interpretations of what this means, a Moment of Truth can be described as, “an interaction with the customer that can cause a significant impact (positive or negative) on the attitudes of the customer to the bank.”
If Moments of Truth are understood and managed correctly, the result will be an increase in satisfaction, loyalty and, hopefully, increased business with the customer. Equally, poor handling of the interaction is likely to lead to dissatisfaction and defection.
For many banks the concept has primarily been applied to unique interactions of high emotional impact to the customer – how the bank handles fraudulent transactions, lost or stolen cards or breavement, for example. However, a number of banks have moved the concept further.
First, the research of many banks has indicated the importance of key sales and advisory transactions in the development of the relationship with the customer. The customer feeling that her needs have been understood and met by a meeting with a bank advisor has a different perception of the bank than the one that feels the advice given has been for the purpose of increasing the bank’s fees and commissions.
Secondly, it has been noted that whilst events such as excessive queuing for counter service are not individually significant, if it happens frequently the cumulative impact can cause an equally negative reaction as the poor handling of a single major issue. The last time it happens can be the straw that breaks the camel’s back.
Banks have moved to recognise that for different customers many different types of interaction can have a major impact on their relationship with the bank. This leads to the problem that if any interaction may have a serious consequence for the customer, what should a bank focus on improving? Is it possible to ensure that any interaction will be dealt with effectively and will lead to increased satisfaction, or should banks play the percentage game and concentrate on certain types of interaction or, indeed, certain customer groups?
The purpose of this article is to understand the use of the Moments of Truth concept within banks today. It is based upon specific interviews with 14 banks supplemented by Finalta’s ongoing work on retail management best practices with over 30 banks across Europe.
To read the full article, please download the PDF above. 

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