Senior Research Analyst,
Cornerstone Credit Union League
Are Member defections, internal growth, and increases in new Members where you want them to be? For too many credit unions, the answer to the question is, “No.” Some credit unions decided to innovate and do things differently. You can too!
One of the tools to consider is the Member Effort Score (MES), a system which uses Member feedback to improve service and modify internal policies and procedures. Yes, this research really pays off. And, it is a straightforward approach that will have all of your employees on board with improving your bottom line on a continuous basis.
More Reasons to Use MES
Did you know that credit union Members are more likely to defect due to poor service than they are to stay for great service – or even great rates. Think about these statistics.
- One-in-four customers are likely to say something positive about their customer experience, while 63% are likely to speak negatively about a bad service experience.
- Among customers experiencing a positive service transaction, 23% told 10 or more people about it, while 48% of those with a negative experience told 10 or more people about it.
The “word” on your credit union gets out because about six-in-10 people run into problems when they contact customer service. For example, they:
- Had to re-explain things.
- Had to use multiple channels (e.g., had to switch from the web to phone).
- Were transferred.
- Put out moderate/high effort to resolve their issue.
- Had to contact the company multiple times to resolve their issue.
Think about Members or potential Members asking themselves: “Where should I do my banking?” or “Where should I get my Mortgage?” Your service reputation and your Members’ past service experiences matter.
Recent research is confirming that reducing a Member’s effort to the point that you are making it easy to resolve issues/accomplish transactions does more to retain customers than exceeding their service satisfaction expectations. Acting on the insights that expose how to resolve Members’ problems not only improves customer service, but it also reduces customer service costs (e.g., getting it right the first time) and reduces Member defections.
Reducing Member effort makes you a stronger competitor. This method can help in many areas such as new Member application, Member defection, requesting a mortgage loan, setting up bill-pay, and transferring funds. So, get started eliminating obstacles and make it easy for Members to contact you and use your products/services.
Basic Steps of the Member Effort Score (MES)
The Member Effort Score (MES) is measured using two questions: (1) an “Agreement” question that measures how easy it was for the Member to handle their issue/request; and, (2) a question about expectations being met or not met (designed to put the first answer into a frame of reference). Expectations matter. If a Member expects giving low effort and has to give high effort, you may be at risk of losing him/her. If a Member expects high effort, then meeting this expectation is far less risky than the first scenario.
The size of the gap between actual performance and expected performance indicate areas where your service is viewed as exceptional and/or needs to improve. The other questions in the survey (diagnostics) will pinpoint the specific actions that need to be improved and those that are delighting your Members.
Engage your Members and staff and remove obstacles (e.g., a Member has to call back multiple times or has to call customer service after several attempts to solve a problem online). You might learn not only how to solve that particular problem, but you might get a bonus – you will learn how to head off additional problems!