Feb 25 2013
Linking Member Satisfaction to Share of Deposits: Applying the Wallet Allocation Rule in CUs
Drawing on a new tool—the Wallet Allocation Rule—this research investigates how credit union managers can do a better job of translating high member satisfaction levels into improved share of deposits.
The findings of the research by Dr. Aksoy and her coauthors with regard to the satisfaction and NPS metrics that credit union managers typically measure and manage are sobering. Satisfaction and Net Promoter explain less than 10% of the variation in members’ share of deposits. This in large part explains why, despite the fact that credit unions hold the highest satisfaction levels for any industry tracked by the American Customer Satisfaction Index (ACSI), the share of deposits held by credit unions substantially lags that of their bank competitors.
It’s not that satisfaction and Net Promoter levels are not important. Rather, it is the way these metrics are analyzed that is the overriding source of the problem. Analyzing member satisfaction using the Wallet Allocation Rule, Dr. Aksoy is able to explain 55% of the variation in members’ share of deposits.