Why New Buying Decisions Are Bad

I currently have a bank account with a large national bank chain. I’ve been a customer for about ten years with a spotless banking record.

First, the background: they offer several flavors of personal checking accounts. I recently wanted to change from one type of individual account to another, so I e-mailed the bank to find out the process for making this change.

I was astonished when I got a reply that essentially said: You’ll have to drive to a branch bank and fill out a “new account application” from scratch. My immediate reaction was “Um, I don’t THINK so.”

This is what we call “forcing the customer to make a new buying decision.” It’s a bad, bad thing. Your wellness business should avoid it at all costs. Here’s the deal:

I originally never considered shopping around. After all, I have electronic payees already set up, I’ve got preprinted checks in my desk, I’m comfortable with their electronic statement process, they have ATMS all over the place – why would I want to go to the trouble of changing all that when it’s working?

But almost all of those barriers to my switching banks vanish if I have to go through the entire “new customer” process from scratch. If I’ve got to set everything up from scratch again, I might as well shop around at other banks. Maybe I can get a better deal (or just better service) at one of their competitors, or at a smaller regional or local bank.

By treating me as a brand-new customer, my bank has, ironically, forced me into reconsidering my original choice to use them. Now, I don’t know if this is just a bad process on their part, or the result of a regulatory concern. Regardless, I’m absolutely certain that they could facilitate the process of switching from one account type to another – if it were important to them.

Instead, they’ve presented me — very matter-of-factly — with a new buying decision that may well result in my choosing a competitor.

I see examples of this in our industry.

For example, individual outlets of some massage franchises offer punchcards that they stamp for every visit. After ten visits you get a free massage. However, each outlet only honors its own punchcards. They don’t care if I’ve visited ten other outlets in the same chain – to them, I’m a new customer. The greed of the individual outlet operator (“But I don’t want to redeem a card for someone who didn’t buy all ten massage sessions at my outlet”) overcomes what’s good for the customer and hurts everyone in the process.

One more example: my health club has several locations in the Metroplex. But I can only use them if I pay for a more expensive membership. Of course, at that point, I’m motivated to start looking at other options. It costs less to pay the day rate at any of the commercial or not-for-profit clubs than it does to buy the pricier all-DFW-club membership from my own gym. They essentially force me into making a new buying decision anytime I want to visit another location. It’s a very short-sighted business practice.

I always think about how much it annoys me as I drink my smoothie, munch my protein bar, and get a massage at my gym’s competition. They coulda had my extra cash if they had only made it easier for me to spend it with them!