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Does good customer service matter? Not really …

I just had one of those really frustrating experiences with
an airline.

It’s a cheap airline that charges for an extra €10 for a
large cabin bag (over 42 x 32 x 25cm) to be taken on board, as well as a fee
per checked bag. 

So I pay to put a bag in the hold during my online booking
and turn up at the airport with two cases – a briefcase and a suitcase – whilst
my colleague has a heavy cabin bag and a suitcase.

At the airport, they check sizes of all cabin bags and it
turns out my briefcase is 1 centimetre too wide. It’s very light and thin, but
that 1 centimetre turns into a €40 fine for not pre-booking a large cabin bag
for a €10 fee.  Meanwhile, my colleague's bag which is twice as wide and heavy, but within limits, is no charge.  To be honest, it was
clear that this is just a method of catching out the customer in order to raise
extra income from nefarious fees and means, and it left me livid.

Fuming from the moment of before check-in at the airport, I
spent the whole flight cursing and hating the airline every minute of the way.

It wasn’t the fine that bugged me, but the we’ll catch you if we can way in which
it is used.

So, in order to avoid a fee on the flight back, I went
online and changed my booking to include one large cabin bag, for a fee of €10.

Arriving at the airport, the experience was very different
and, as I queued at the Gate, the airline staff came round and, without checking
my ticket or asking, stamped a ‘small cabin bag’ sticker on my large cabin bag

They didn’t measure it or question it, just waived it

Now I was livid for paying the €10 fee before boarding when
I needn’t have.

What this demonstrates, if you put yourself in my shoes, is
how really annoying stupid rules are, particularly if they are applied inconsistently.

I now intensely dislike this airline because, if I ever
travel with them again, I will need to carry a tape measure with me to see if I’m
going to make or break their rules.

Now think of this in a bank.

In a bank, there are many stupid rules but one of the most
irritating is the practice of clearing all debits from an account before applying
any credits.

This is a common practice and tries to push the accountholder
into overdraft, so fees apply, before applying any credit offsets to the account
to avoid such overdrawn issues.

This is why some people are happy to pay more for flexible
accounts that do not apply stupid rules or fees.

So you then say: what
you pay for is what you get.


But then take note of a certain airline leader’s humiliation
and change of view recently:*

Earlier this month
Ryanair decided that being horrid to customers was not a great business
strategy and declared it would be a bit nicer. This was pretty remarkable and
has, indeed, been much remarked upon.

Yet even more
remarkable was what caused chief executive Michael O’Leary to make this U-turn.
It was not market research. It was not social networks. It certainly was not
anything to do with management consultants, whom Mr O’Leary once said he would
shoot if they ever darkened his doorstep. Nor was it due to pressure from the

Instead, the trigger
was people who periodically accost him in McDonald’s to moan about his airline
while he sits trying to enjoy a meal with his kids. As he said to shareholders
at last week’s annual meeting, he is sick and tired of it.

So never mind big
data. When it comes to bringing about change it is criticism delivered in
person by random strangers that counts.

Customers do count, even if we don’t think their opinions

Take it another way, here’s a view from Manu Sporny, who
blogged about his SIBOS experience this year:

Many people are under
the false impression that the most valuable customer a bank can have is the one
that walks into one of their branches and opens an account. This impression was
shattered when I heard the head of an international bank utter the following
with respect to banking branches: “80% of our customers add nothing but sand to
our bottom line.” The banker was alluding to the perception that the most
significant thing that customers bring into the banking branch is the sand on the
bottom of their shoes … most of a bank’s revenue comes from activities like
short-term lending, utilizing leverage against deposits, float-based
leveraging, high-frequency trading, derivatives trading, and other financial
exercises that are far removed with what most people in the world think of when
they think of the type of activities one does at a bank.

So do customers count? 
Should we care about their feelings?

Even a ‘millionaire’ cannot expect good
service at the bank

Banks for the rich are not always better than banks for the rest of us,
according to a mystery shopping exercise that revealed shortcomings at some of
the most illustrious private banks.

UBS, the biggest private bank in the world, was portrayed as impersonal,
indifferent and offering a distinctly off-the-peg service, in spite of its
promise of being bespoke.

Coutts, which serves the Queen as well as dozens of professional
footballers, was criticised for its lack of empathy and could not even jot down
cusotmes email details correctly.

Rothschild Bank failed to call prospective clients back after promising to
do so, while Mirabaud made a gaffe about their nationality.


* take note that Ryanair are speaking at the Financial
Services Club Ireland on 16th October

Ryanair, Europe's
Leading Airline
 with Howard Millar, Deputy Chief Executive and Chief Financial Officer, Ryanair

Ryanair has grown from small beginnings to rank as one of
the leading airlines of the World and is a huge financial success story.

Publicly associated with its flamboyant Chief Executive,
Michael O’Leary, we have asked his deputy Howard Millar, Chief Financial
Officer to talk to us.  He is intimately
associated with the success of the business and his presentation will share the
current state of the airline and provide insights to the factors that make
Ryanair such a force in the highly competitive international airline business.

With a current fleet of over 300 aircraft and 80 million
passengers a year the aim is to grow that to over 400 aircraft and 110 million
passengers by 2019.  The financial
highlights include a reported net profit to March 2013 of €569 million on
revenues of €4.8 billion, not to mention a balance sheet carrying €3.5 billion
of cash!

This is a success story worth hearing.

The session will be followed by drinks, canapés and


About Chris M Skinner

Chris M Skinner
Chris Skinner is best known as an independent commentator on the financial markets through his blog, TheFinanser.com, as author of the bestselling book Digital Bank, and Chair of the European networking forum the Financial Services Club. He has been voted one of the most influential people in banking by The Financial Brand (as well as one of the best blogs), a FinTech Titan (Next Bank), one of the Fintech Leaders you need to follow (City AM, Deluxe and Jax Finance), as well as one of the Top 40 most influential people in financial technology by the Wall Street Journal’s Financial News. To learn more click here...

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