Loyalty

Are you loyal to your bank or your cellphone provider? In fact, can a consumer ever be “loyal” to a supplier? Can anyone be loyal to a company that makes money from the relationship?

Most large commercial companies, particularly banks, cellphone providers and supermarkets talk a lot about loyalty. In fact many of them have explicitly named “loyalty schemes” that reward customers for using their services rather than those of the competition. You can probably think of local companies that have such schemes that allow you to earn points, prizes and treats the more you use their products and services.

What they are trying to do is form some sort of relationship in your mind, in the same way that you might support a local football team. However, let’s face it, that loyalty only works one way. It’s loyalty to the company they are trying to create in your head, not loyalty to you from the company that’s uppermost in their minds. There’s nothing inherently wrong with that of course, it’s just the way the free market works. Companies are free to mess with your head, just as you are free to take your money wherever you feel like.

However, I often wonder whether this is loyalty at all. I sometimes wonder if it isn’t just familiarity or some days just apathy.

Maybe it depends on how you define loyalty. My dictionary says “loyalty” is “a strong feeling of support or allegiance” and “loyal” means “giving or showing firm and constant support or allegiance to a person or institution”.

But is there any customer loyalty in Botswana? Are customers loyal, for instance, to their bank or cellphone provider? How could we possibly know? We don’t have access to the internal data collected by banks and cellphone providers so how can we tell?

Consumer Watchdog comes to the rescue, yet again!

Rather than just wonder how loyal bank and cellphone customers are, we decided to find out. We hit the shopping centres and actually asked people how loyal they were. In total we questioned 200 random people while they were out shopping. As far as we can tell this was a reasonably representative sample of people. Some old, some young, men, women, tall, short, as far as we could tell a cross-section of people like you and me. We asked them a couple of key questions. Who did they bank with, which cellphone company did they use and did they think their bank and cellphone company were the best?

I’m not going to give the exact figures for each company because such a small sample isn’t big enough to come to any valid conclusions but the overall figures about loyalty were interesting.

Let’s begin with the cellphone companies. The first big finding is that one in three people were in fact with more than one network provider. However an impressive 92% of all the people we surveyed thought that their main provider, the one they used the most, was the best in the country. It’s clearly an industry where loyalty can be obtained but also one where people can afford to shop around and be with more than one provider. We even met 5 people who carry three SIM cards around with them to get the best of each provider.

The there’s the banks. In the league table one bank clearly came First. One of the larger banks, an impressive 95% of it’s customers thought it was the best. At the other end of the spectrum was perhaps the largest bank we have in Botswana. Only 58% of their customers think they’re the best. Overall the average “loyalty” figure for banks was 80%. Clearly some banks command much greater loyalty than others. What can the difference be?

I’m not yet sure, but we did ask another question that I think might give us a clue. We asked people which of three things were most important to them about banking: speed of service, appearance of the branch and quality of service.

Top of the list was service quality. 45% of people think this is what matters most in a bank. Running a very close second came speed. 43% of people thought this was the most important thing. A mere 12% thought the appearance of the branch was what mattered most. I think that gives us a clue about what creates the loyalty I’m thinking about. As a community of customers we don’t give a damn about how glossy and shiny a bank is, what we want is swift, friendly, efficient service. It may be that those things create a “loyal” community of customers, the sort of customers who will extol the virtues of “their” bank to their friends, neighbours and family.

I can’t also help think that the loyalty of customers to a bank and to a cellphone network provider are very different. If a prepaid phone customer gets irritated with their current provider they can be with the competition 15 minutes later. It’s not nearly so simple with a bank. Imagine, if you can, how much time and effort it would take to move banks. A month if you’re lucky.

Here’s a final question for Mmegi readers. What do you think we should ask consumers about in our next survey? What do you want to know?

Finally a quote from Maurice R. Franks who I believe is a law professor in the USA and is clearly very smart:

"Loyalty cannot be blueprinted. It cannot be produced on an assembly line. In fact, it cannot be manufactured at all, for its origin is the human heart - the center of self-respect and human dignity. It is a force which leaps into being only when conditions are exactly right for it-and it is a force very sensitive to betrayal."

This week’s stars

• Nametso at Standard Chartered Bank. Our readers says she “has been transferred to Lobatse branch and will be sorely missed by her Game City branch customers”.