A Simple Tool to Help Your Bank Assess and Create Customer Value

It’s a universally accepted concept: The bank that delivers what customers really want ultimately wins the competitive advantage. At a minimum, a bank must understand what customers value and how to create, communicate and deliver that value to them. Otherwise, customers will simply go somewhere else.

But before you as a marketer can improve the delivery of value to your customers, you first have to know what your customers value and how well your bank can create that value. One way to find out is by designing a feedback tool and then plotting the results on a value importance-performance grid.

I first read of this idea in James G. Barnes’ insightful book, Secrets of Customer Relationship Management: It’s All About How You Make Them Feel (McGraw Hill © 2000). Here, Barnes discusses how customer feedback can help you add value to increase retention, differentiate your bank and gain a competitive advantage.

Customers’ answers from a survey, for example, are plotted on a grid. Values that land in the upper-right quadrant represent high importance to the customers and where the bank is perceived to be performing well. Those in the upper-left quadrant are also of high importance to the customer, but ones the bank is falling short on delivering—and, subsequently, a high priority for improvement.

The grid in Figure 1 illustrates that Bank ABC isn’t effectively and consistently communicating with its customers in a personalized way. Based on the values in the upper-left quadrant, this bank should develop a marketing strategy that allows them to make regular contact with its customers. Each message should be personalized, build upon the last message and encourage the development of a dialogue between the customer and the bank.

The results that fall below the median, in the lower-left quadrant, are those things that customers say they don’t consider very important in delivering overall value. Equally as helpful in determining an effective strategy, these results show where the bank shouldn’t have to spend additional marketing resources.

The lower-right grid shows the things that customers feel aren’t very important, but that the bank is seen to be delivering well—areas where they’re possibly over-delivering. Here, the bank can infer that it may be wasting its marketing resources and should redirect its efforts to the upper-left quadrant where they would be better used to create stronger, lasting customer relationships.