Loyal Clients: The True Acquisition Magnets in Business

Competition is exceptionally strong in the banking sector, as it is a service where the range and products are relatively similar amongst market participants looking from an average client’s perspective. This statement is especially true in the Hungarian banking market, where state-supported loan products are the most popular on the market, such as the Baby expecting loan in Retail or the Széchenyi Card Program’s product’ in SME segment. These are available in almost every bank in a standard form as these are not a given commercial banks’ own products, but state-related products. As the competition is fierce, a bank cannot afford to have unsatisfied clients. It is a well-known fact that it is much more difficult and expensive to acquire a new customer than to keep an existing one, and in parallel you may earn much more on a loyal client already in your books than on a newly acquired one. An unsatisfied client can easily switch banks, which can be prevented if we make sure that we have a customer base with a high NPS (net promoter score). I strongly believe that nurturing existing customers is way more important than acquiring new ones. A loyal customer generates more profit by typically using more of our services, and they are less sensitive to our costs or possible interest rate changes if they are satisfied with our services and the way they are taken care of. We can’t lose by valuing our customers, listening to their feedback and always paying close attention on proper NPS score measurement.

However, acquisition and client portfolio management are not two completely independent things, there is a rather strong connection between them, which is absolutely not negligible: a loyal client is more likely to bring us new customers through referrals, and they also strongly contribute to a positive brand image, which helps to acquire new customers. Word-of-mouth plays a particularly important role in the SME sector, business owners are likely to talk to each other about their banking experiences and if our clients speak positively about us, it contributes to the growth of our customer base.

A loyal customer is one of our biggest assets in the market competition, not only in the banking sector, but in any other industries, so we always recommend measuring the satisfaction of your customers in some way. To do so, the NPS bar is just one simple but effective way. There are multiple other ways to do so:

1. Questionnaires, online surveys: online questionnaires are great opportunities to assess how satisfied our customers are, and the typical NPS question is often included: „how likely would you recommend our company on a scale of 1-0?”

2. Telephone surveys: questions about customer satisfaction measurement or NPS score measurement can also be easily included in customer service conversations.

3. Customer service, network feedback: our employees, who are in contact with our customers every day definitely have some useful experience or knowledge, they know why customers are dissatisfied, where our potential weak points are, and it is definitely worth making use of this information.

4. Analysing customer feedback, online platforms and app reviews: the opinions left on our website, social media or mobile application should not be ignored either, and it’s also good to track what people are talking about on other media sites or forums. We know that dissatisfied customers comment more often than satisfied ones, so we will not determine our NPS score based on this, but these platforms also give feedback on where we need to improve.

If we invest energy into a deeper understanding of customer satisfaction, it not only contributes to our development, but also supports us to maintaining market competitiveness in the long term. In addition to quality products and service, the customer’s positive emotional attachment to our brand can also be the base of their loyalty.