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Friday, July 31, 2009

My Pizzeria takes on My Bank

On the way home this evening, I stopped at my local pizza parlor and local bank branch. Just for fun, I pitted the attributes of the two service experiences against one another.

Guess who won?

The pizza parlor is open when I want pizza. The bank is open when I’m at work, and mostly closed I have time to go to a bank.

When I’m ordering take-out or delivery, the pizza place answers the phone, even if they have to put me on hold. The bank periodically routes calls to a “hang-up-on-me” option I’ve never selected.

In the pizza parlor, I wait amongst the aroma of baking pies. Other customers are happy to be there. At the bank I wait, either in person while listening to other customers mostly complain about heir bank service, or on the phone with an IVR response that begins, “due to unusual call volumes…” (BTW, is it unusual if it happens constantly?)

Pizza parlor has a signature dish. They make an Italian pie with a spicy jardiniere. The place down the street’s signature dish is a cheeseburger pizza, complete with onions, pickles & mustard. The point is that they intentionally differentiate along at least one line. Every bank seems to “me-too” their offerings, to the point where I wonder whether it matters where I keep my money? (Should banks be worried that we see them as as undifferentiated as “The Detroit 3”?)

I bet your bank has a www.banknameheresucks.com website devoted to disgruntled customers’ commentary. And I bet your local pizza parlor doesn’t.

The pizza place is willing to bring their offering to me, and even guarantees that they won’t waste my time. The bank?

Service recovery at the pizza place usually means a free meal. At the bank, it might not even mean an apology.

The service employees at the pizzeria are not as highly compensated as their bank counterparts, but are almost universally more service oriented.

I’m not saying that every bank should recraft their service to act like a pizza parlor. I know that what you expect from a bank is orders of magnitude more than what you expect from a pizza place.

But I do think that your average bank could learn a thing or two from how the local pizzeria approaches service. Extending outward, what would Southwest look like if they were a bank instead of an airline?

When a pizza place doesn’t deliver on their promise, we’re merciless consumers. We drive places out of business almost overnight. Yet somehow, when a bank doesn’t deliver on a promise much more important, most of us let it slide. If ever there was an industry that was ripe for a new service model to take it by storm, retail banking is it.


Chris Haines said...

It's not fair to paint all banks with the same brush. TD Bank in Canada (and the US Notheast) has brought a retail store experience to their bank branches. Aside from being open evenings and Saturdays, the have even started hiring people with retail store management experience as branch managers. TD has become the most successful retail bank in Canada, so look for this strategy to be replicated.

Chris Reaburn said...

Agree, some are better than others, though I would say that they are incremental steps, variations on the same business model, and if they are successful, as you say, "look for this strategy to be replicated".

The problem as I see it is that no one is changing fundamental components of the business model, which I think would require a completely new entrant.

Chris Reaburn said...

My last comment was quick enough to seem dismissive. Unintentional. I think that some banks are making some strides on their experience. If you believe the most recent round of advertising, they at least acknowledge "fed up with my bank" as a condition that exists with a lot of consumers. I question though, whether banks are talking about real model change or whether they are satisfied with tweaking their model slightly in order to look like their changes are dramatic. The problem with that is that a) those small changes are easily replicable by the other banks that they are trying to differentiate themselves from, and so as soon as there is any difference, the others work to close the gap and b) the incremental changes are never as dramatic to the marketplace as they are to the companies making the changes percieve them to be, and so they usually fall short of their intended goals, and get relegated by management as "another one of those things we tried that didn't work".

Chris Haines said...

Don't get me wrong, as a former bank employee I admit that 90% of banking customer experiences are terrible. They are the most change-resisting institutions in a lot of countries. But lately I have noticed some that are really embracing the retail culture. TD Bank hiring people with retail experience to be branch managers (which is now a neutered position due to automatic credit decisioning and centralized processes) shows that they are serious about improving the customer experience.