How Short Term Greed Trumps Long Term Business Sense
from the how-to-lose-customers-and-piss-off-people dept
Online banking has been an interesting area to watch over the years. It was slow to take off originally — often because of poor design and high fees. However, after a few years, it finally did catch on, helped along by a lack of fees and the overall convenience it provided. Banks also saved money by automating many tasks that it took a human to perform before online banking was used. The banks who had been so keen to charge initially, also saw an unintended consequence of not charging: it increased loyalty and decreased churn. Users who had gone through the trouble of setting up their online banking systems didn’t want to go through the hassle of changing it. Of course, rather than recognizing a good thing for what it is, it appears that some banks can’t keep the greed away. Down in Australia, the Commonwealth Bank has decided to pull the rug out from under many happy online bankers and is adding plenty of fees for doing just about anything beyond the most basic online bill paying. Of course, all this really does is take away much of the incentive for customers to stick with this bank. This is, of course, the standard bank response — to look for more places where fees can be added. However, it’s a short term strategy, ignoring the value of having a loyal, long-term customer.