In 1988 my oldest stepdaughter was attending university, paying rent, working part-time and pursuing a singing career. Money was tight, to say the least, and it was definitely time for her to have her first credit card. My advice? The same card I was using which, at the time, was called a Value Visa. Created by Scotiabank, it had no annual fees and it offered the lowest interest rate if she ever ran a balance. This year, as she celebrated her 48th birthday, she was still using that card, until last week when the bank informed her they didn’t want her business anymore.
Why did the bank end this 30-year relationship? What does it say about the value of customer loyalty?
My stepdaughter (and dearest friend) is voice actor, Natasha Marchewka. She and her family have lived a lot of places in the last 30 years – New York, Grand Cayman, Toronto, Halifax and, for the past three years, Los Angeles. When in Canada, she’s continued to use her Scotiabank Visa, tucking it away for safekeeping when living outside the country.
So when Natasha received an email about the Visa at the end of July, she didn’t rush to open it. She believed there was no balance and with work, life, summer vacation, etc., the message wasn’t on her priority list.
Last week, with her children settled back in school, Natasha was diligently clearing out her inbox and discovered that the credit card does now have an annual fee of $29. The payment due date was August 27; she was two weeks late. Going online to make the payment, she was not able to access her account. A phone conversation with customer service revealed that the bank had made the decision to cancel her card. Astonished, she explained that she was a 30-year customer and wanted to keep the card. The response?
She would have to re-apply!
For an overdue amount of $29, Scotiabank dismissed a 30-year customer. The only proactive communication was one email. No phone call. No regular mail. And no one at the call centre had the power or authority to change the situation. The only suggestion was that she visit her branch … a bit of a challenge when you live in LA.
It’s possible this happened due to automation. The lack of activity on the card combined with a late payment signalled some system somewhere to close the account. In doing so, the bank has lost any possibility of having Natasha as a customer again … or of having her recommend Scotiabank to her children when the time comes to organize their first credit card.
Loyalty is precious. We spend years diligently building our brands and reputations with this as the pinnacle of success – loyal customers that continue to work with us, speak well of us, generate referrals. How do we honour them? How do we acknowledge their value?