The Top 3 Drivers of Member Loyalty

By Michelle Bloedorn, CEO of Member Loyalty Group

People often ask us what really drives member loyalty. After collecting 3 million member feedback surveys on behalf of our participating credit unions, we’ve learned that there are three key factors that help drive loyalty.

As you can see in the chart below, the three key drivers that our data has helped pinpoint as the most highly correlated to member loyalty include:

  • Ease of Conducting Business
  • Quality Service
  • Acting in the Best Interest of Members

drivers-of-loyalty

Member Effort Score – One Way to Measure Ease of Conducting Business

When you look further at each of these areas, it becomes apparent that not all of them drive loyalty in the same way – or even in the way you might expect. Members tell us a lot of things, but what they don’t talk about is sometimes of equal (or even greater) importance.

For example, Ease of Conducting Business (which can be measured by Customer Effort Score or Member Effort Score) can help credit unions understand how easy it is for members to do business with them.

This is good information to gather, but an adequately easy process doesn’t necessarily translate into higher loyalty. In today’s digital world, an easy experience is quite simply expected. If your experience or process is relatively painless for members, you probably won’t hear about it. And no news is good news in this scenario. However, if it’s not easy or a member is frustrated that can begin to erode loyalty and impact your overall financial relationship.

What does “Ease of Use” Mean?

Making Processes Seamless

  • User-friendly, feature-rich technology
  • Omni-channel
  • Consistent experience
  • Convenience (Hours/locations)
  • Valuing member’s time

Not only are members expecting an easy process, but staff members that are not constantly called upon to make heroic saves will be freed up to focus on the next key driver of loyalty for every member they encounter: delivering quality service.

Quality Service – An Evolving Concept in a Digital Age

With more members interacting with you online or via mobile, the idea of quality service today encompasses much more than just a friendly teller in a branch. It may indeed end up involving a branch or call center rep after an electronic transaction doesn’t go smoothly. But it may also be the availability of a genuine and helpful representative to chat with you and walk you through a complex financial decision.

Credit unions’ most frequently identified differentiator is service and as we continue to gather feedback from members we’re able to expand our own views of this key loyalty driver.

What is Quality Service?

  • Genuine Caring
  • Helpful, knowledgeable staff
  • Follow-through
  • Professionalism
  • Effective problem resolution

Quality service is a key driver that members are more than willing to talk about. You can see this easily by reading member comments describing phenomenal experiences and their favorite staff members, who often make them feel like family. But not all loyalty drivers are this visible.

Credit Unions’ Secret Loyalty Weapon: Acting in Members Best Interests

A member is probably not going to tell you outright that they don’t trust your credit union or that you aren’t honest. After all, the concept of an organization “acting in my best interest” is not always clear to the members themselves as it is an emotional response. However, it is critically important to your relationship and is one area that we’ve found all of our top performing credit unions have in common. If members believe that you are truly acting in their best interests, they are much more likely to be loyal to your organization.

The fact that as a financial cooperative, the credit union business model at its core was created to align with the best interests of its members is probably the biggest secret loyalty weapon we have as an industry. As Jeff Bezos, CEO of Amazon said, “If we can arrange things in such a way that our interests are aligned with our customers, then in the long term that will work out really well for customers and it will work out really well for Amazon.”

What does “Acts in my best interests” mean?

  • Trustworthiness
  • Security
  • Fair Decisions
  • Value Pricing
  • Member-Friendly Policies
  • Transparency

These three key drivers represent only a portion of the feedback we’ve collected from members to help our credit unions shape the member experience. However, we hope you can use this insight as a starting point to discuss your own organization’s goals for 2017.

Learn more about the Link between Member Loyalty and Financial Performance.

If you’ve enjoyed this article, we invite you to download our report on Loyalty, Member Relationships and Financial Linkage. This more in-depth resource explores why loyalty matters and how it is tied to bottom-line financial results.

You can also learn more about Member Loyalty Group’s Member Experience programs by contacting us at [email protected].

Net Promoter, Net Promoter Score, and NPS are trademarks of Satmetrix Systems, Inc., Bain & Company, Inc., and Fred Reichheld. Copyright © 2016 by Member Loyalty Group.