Credit unions thrive on creating great banking experiences for their members. In a highly competitive landscape of financial institutions, credit unions should continue to focus on their strength of delivering exceptional member experiences to differentiate themselves and attract and retain members. Credit unions should better understand member satisfaction and loyalty levels by evaluating Customer Satisfaction (CSAT) and Net Promoter Scores (NPS).
By measuring and analyzing these scores, they can gain valuable insights into member experience, identify areas for improvement, and ultimately enhance their overall service levels.
In this blog post, we will explore the importance of CSAT and NPS scores for credit unions, highlight the differences between the two, learn how to calculate these scores, explore the benefits of good scores, examine common reasons for low scores, and discover actionable strategies to improve member satisfaction with a seamless collections experience.
The Difference Between CSAT and NPS Scores
What is a CSAT score
CSAT (Customer Satisfaction) score and NPS (Net Promoter Score) are two distinct metrics that credit unions can utilize to assess member experience. The CSAT score primarily focuses on measuring the satisfaction level of members based on specific transactions or interactions within the credit union. It provides insights into how well you meet member expectations and deliver on requests.
What is a NPS Score
On the other hand, the NPS score goes beyond satisfaction and aims to gauge member loyalty by asking a simple question: "How likely are you to recommend our credit union to others?"
- Promoters (score between 9 and 10) - happy, loyal members, scoring between 9 and 10
- Passives (score of 7 or 8) - content with services but are not pleased enough to refer someone, scoring a 7 or 8.
- Detractors (Score 0-6) - unhappy members who may even discourage other interested members from banking with your credit union.
Segmenting members based on feedback helps credit unions identify overall member satisfaction and the potential for organic growth through positive word-of-mouth referrals. While both scores offer valuable insights, combining CSAT and NPS scores provides a more comprehensive understanding of member experience, enabling credit unions to make data-driven decisions and improve service delivery.
How to Calculate CSAT and NPS Scores
Calculating CSAT scores for credit unions involves surveying a representative sample of members to gauge their satisfaction levels. The credit union designs a survey with specific questions and a rating scale, such as 1-3, 1-5, or 1-10, allowing for some flexibility in capturing feedback. According to the ACSI, 77% is the total CSAT score benchmark for credit unions. Monitoring benchmarks over time allows your credit union to track progress, gain a competitive advantage and enhance the member experience.
Next, to calculate NPS scores you can ask your members the following two questions:1) On a 0-10 scale, how likely is it that you would recommend our credit union to a friend or colleague
2) What is the primary reason for your score?
Respondents are then categorized as Promoters, Passives, or Detractors, based on the ratings provided above. The Net Promoter Score is calculated by subtracting the percentage of detractors from the percentage of promoters, yielding a score between -100 to 100. Most credit unions average +50 or higher overall for NPS scores.
Common Reasons for Low CSAT and NPS Scores
A study by Galileo showed that of the 65% of consumers who primarily use a traditional bank account, only about two-thirds are satisfied with their bank. Credit unions should look at the factors that can contribute to lower CSAT and NPS scores. By identifying these common pain points, you can proactively address and rectify them, ultimately improving member satisfaction and loyalty.
Some key contributing factors to low scores could be:1) Poor communication - inadequate communication with members, such as delays in responding to queries or longer hold times to get to the appropriate person to resolve issues.
2) Lack of personalization - not personalizing member interactions and delivering tailored experiences.
3) Limited digital services - if members need to call or visit the branch to resolve issues, this could lead to frustration among members who seek convenience and self-service options.
4) Poor issue resolution - ineffective handling of member complaints or issues often leads to lower satisfaction and referrals.
Improve CSAT and NPS Scores With a Seamless Collections Experience
Leveraging technology to reduce friction at every interaction point can significantly improve the member experience, resulting in better scores. Prioritize providing the same level of service - from onboarding to collections. The collections stage is even more critical as it could be the most recent interaction to impact satisfaction.
Here are some strategies to consider to improve the member experience:1) Invest in user-friendly digital tools, like mobile apps and self-service payment options, to provide members with convenient, seamless digital experiences. Ensure that the technology is accessible, secure, and meets member expectations. Offering a more convenient payment resolution process requiring fewer steps from members helps for a much more positive experience.
2) Leverage data and analytics to understand individual member preferences and tailor communication and payment plans to meet their needs.
3) Proactive communication strategies can help keep members informed about upcoming bills and can help prevent defaults and improve member satisfaction. A simple, friendly nudge will yield a better experience than more urgent outreach with later delinquencies.
If your credit union's CSAT and NPS scores have gone up after implementing changes to the process, this is a good indication that it was worth the investment.
In the age of heightened consumer expectations, credit unions must pay attention to the significance of measuring member experience through CSAT and NPS scores. These metrics give credit unions valuable insights, enabling them to make data-driven decisions, deliver exceptional service, and build solid and lasting relationships with their members. By recognizing the benefits of good scores, addressing common reasons for low scores, and implementing strategies for improvement, credit unions can create a member-centric environment that drives satisfaction, loyalty, and long-term success.