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It’s also the key to providing better products and services for customers. Unfortunately, for many companies, the strategy to attract, nurture and retain customers is often left to chance. It shouldn’t be.
Importance of a customer-centric approach
According to a Harvard Business Review report, brands that excel in customer service consistently report 2.5 times higher revenue growth and this was true across all industries.
In many cases, successful word-of-mouth marketing was a critical part of a successful customer service strategy — along with clear procedures of how a company interacts with its customers, both during regular transactions and when addressing problems. Turns out this focus on the customer pays off. According to the McKinsey & Company: Word of Mouth Marketing report, generating positive word-of-mouth referrals plays a substantial role in influencing 20% to 50% of consumer purchasing decisions.
A customer-centric business model is not a new concept but choosing this approach is often much harder in practice. This is particularly true for the Canadian personal loan marketplace where a large portion of the process is done completely online.
“Almost all of our daily financial transactions are electronic,” explains Tyler Thielmann, President of Spring Financial. “Why shouldn’t financial services offer the same access and convenience?”
Thielmann used this desire — for a better, faster and more user-friendly service for finding and getting personal loans — and launched Spring Financial in 2015, a 100% online alternative personal loan lender that provides different types of loans to people with fair to bad credit, across Canada.
“You shouldn’t have to take time off work or away from family just to access financial solutions,” he explains. “These days with all the technology at our fingertips, it only makes sense to offer personal loan application and approval using online and interactive technology.”
Why technology matters for personal loan clients
While the experience of COVID restrictions may have prompted more companies to adopt text-messaging technology and online chats, Thielmann insists that these options were a core feature of Spring Financial when the company first launched.
Canadians have used their phone to regularly text for more than 20 years, he explains, but big banks and large financial companies still require a telephone call or an in-person appointment if anyone requires help with financial solutions.
“We chose to give Canadians access to financial solutions — such as credit builder and personal loans — using the technology and processes they favoured.”
For Canadians that means the ability to apply, ask questions and confirm loan approval through text message, online chat, or by phone — or a combination of all of the above.
“It’s about giving customers the ability to find a debt solution on their terms, at their pace,” says Thielmann.
“This is the basis behind the Pareto principle,” explains Romana King, Group Editor at Finder, “where 80% of results come from 20% of the effort. While companies competing in the personal loan marketplace may spend a lot of effort attracting new customers, it’s how you service those clients pre- and post-approval that builds customer loyalty.
“Customer loyalty is critical in an industry where customers are searching for a solution to the stress of financial strain,” says King, “and the reason we launched the Finder: Personal Loans Customer Satisfaction awards. By measuring customer satisfaction and personal recommendation scores, we developed a list of the top brands in Canada that offer exceptional customer service in the personal loan marketplace.”
This year, Spring Financial earned a Most Recommended score of 91.30% and a Best-Rated customer satisfaction score of 76.52%.
Customer service matters when shopping for a personal loan
Every year thousands of Canadians turn to personal loans to help manage their expenses. While the current lending marketplace offers plenty of options — often with promises of easy application and fast approvals — finding the right loan can be an overwhelming process.
Quite often, it’s a stressful time and having to run around, schedule appointments and fill out paperwork — only to find out you’re not approved — adds to the stress.
“We aim to give our customers quick, easy access to the right loan for their needs,” says Theilmann. “The goal is to offer a frictionless process that doesn’t add to their stress. Instead, we focus on quick, efficient and secure communication and a simple application process with ongoing support. Our goal is to turn a customer into a repeat client — and part of that is to proactively help our clients to get better rates for better products.”
Giving the customer the best loan options is part of Spring Financial’s customer-first approach.
“We built our business with the customer’s needs in mind,” says Thielmann. “We took the time to understand what prevented people from getting the absolute best loan product in the marketplace and then worked hard at removing those barriers.”
He adds that a large part of their role, as a personal loan alternative lender, is helping to educate customers on how to manage debt and the advantages of loan repayment strategies.
This approach is a game-changer in an industry where scams can mean financial ruin.
“Using machine-learning models and the best online experience in Canada, we make sure our clients get the best options,” says Thielmann.
“When companies listen to customer feedback and use that feedback to improve their products or service, it shows,” explains King.
Sources
- Harvard Business Review, https://hbr.org/2020/01/are-you-undervaluing-your-customers
- McKinsey & Company, https://www.mckinsey.com/capabilities/growth-marketing-and-sales/our-insights/experience-led-growth-a-new-way-to-create-value
