NAB's image takes hit from pay woes

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This was published 12 years ago

NAB's image takes hit from pay woes

By Chris Zappone

National Australia Bank’s recent payment troubles threaten to cause an exodus of customers and stymie the bank’s efforts to win market share through its aggressive “break-up” advertising campaign, according to a social media expert.

The set back for NAB comes after a technical problem on April 15 prevented thousands of its customers and customers at other banks from temporarily receiving their pay.

Melbourne-based social media analysis group Online 1984 said that in the two weeks to April 20, there had been 6500 mentions – overwhelmingly negative - of NAB's glitch on social media sites like Twitter and Facebook. About 80 per cent of 4500 of the comments that occurred in the week ending April 16 happened on that day and the previous day when the problem emerged.

“The recent ‘We’re breaking up with you’ ad campaign launched by NAB several months ago looks to be backfiring on the NAB”, said Online 1984's chief executive Jeff Richardson.

NAB launched a “break-up” campaign in February to emphasise the contrast between its services and fees and those of its rivals ANZ, Commonwealth Bank, and Westpac. When the most recent troubles emerged, the language of the campaign was copied by consumers to express their frustration in the wake of the most recent payment fiasco.

One customer wrote on Facebook that their payment came through after "not being there all day" while payments from other parties were deducted. "I am still p****d off and considering a full scale break-up with NAB..."

Another customer tweeted on April 16, "Today I broke up with NAB. It was a nice feeling. Too little too late. Bye NAB sorry it had to end like this."

NAB said that customers understood that the problems at the end of 2010 were isolated. "Any delays or inconvenience to customers caused by the technology incidents we have experienced in recent months are of course regrettable," said a spokeswoman for the bank.

The bank had delivered on its promise that no customer would be left out of pocket as a result of the November incident, she said.

"Our experience is that the vast majority of customers recognise that while unfortunate, these are isolated incidents."

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However, Mr Richardson, said sentiment toward the bank remained negative on social media sites.

“After reviewing hundreds of the mentions regarding NAB the issue is still present, and although the volume of mentions is back to normal almost all mentions the NAB is currently receiving are negative,” said Mr Richardson.

“If this pay glitch was to occur again in the future, or another issue was to happen in the coming months, those customers that have chosen to yet again forgive, and remain with NAB throughout this current issue, may find it impossible to continue to forgive and forget, as many already seem on the brink of leaving the NAB,” said Mr Richardson.

Australian National University branding and marketing lecturer Andrew Hughes said after this month’s payment troubles, “that entire (break-up) campaign is seen as nothing more than advertising of the brand itself”.

The problems for the bank were exacerbated because they hit the bank’s core product, transaction and savings accounts, rather than a secondary offering such as an added on insurance or financial product, said Mr Hughes.

“The bank needs to come out and be clear about how it’s going to prevent it from happening in the future and the procedure for it if it does happen in the future.”

Although NAB said its April problem was unrelated to a bigger payments failure in November and December 2010, the result was similar for customer.

NAB was forced to throw open branches on a weekend to accommodate customers and assure them they would be compensated for any fees incurred as a result of depleted accounts.

czappone@fairfax.com.au


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