As we respond to the ebb and flow of the changing circumstances under which businesses operate, we know that much effort is put into understanding the impact these changes have had upon measures such as employee engagement, customer satisfaction and P&L. I would also argue that seeking to understand how well vulnerable customers have fared should be central to the measures by which organisations judge how successfully they have responded to 2020’s unique challenges.
The FCA has produced some excellent collaborative work over the years to help business identify those who are in need of additional attention and support. These are customers who ‘due to their personal circumstances, are especially susceptible to harm, particularly when a firm is not acting with appropriate levels of care.‘
The FCA, quite rightly, have the protection of vulnerable customers as a key priority. As they say, vulnerable customers may be significantly less able to represent their own interests, they may have different needs and may be more prone to behavioural biases that negatively impact their decision making. The impact of nonstandard needs together with behavioural biases could be further exacerbated by firms’ behaviour. All of which adds up to a significant responsibility for business to act appropriately.
Covid has significantly increased both the number and severity of issues affecting customers, especially for those who were already vulnerable. So, now more than ever the needs of this cohort of customers should be a major consideration.
In the pre-Covid world, it was estimated that just under half of adults over the age of 18 displayed one or more of these characteristics. Just under half and that was pre-Covid.
Now, which of us can say that we, and almost everyone we know, hasn’t been impacted by issues arising from any of this list in 2020? Does that mean that companies must now face the possibility of having to deal with every customer contact as being with a vulnerable customer? How would that work in practice? What consideration has been given to the additional strain which this puts upon staff, who by sheer dint of also experiencing 2020 are likely to be vulnerable themselves? At one point nearly 23% of UK workers were either furloughed, had lost their jobs or were on reduced hours due to Covid.
Clearly, with the speed of change (infection rates, lockdown, tiers and the rollout of vaccines) there is a great deal of uncertainty in play which means rapid reaction and flexibility are key to keeping on top of this issue.
It’s incumbent for business to act quickly- and act well. There have been plenty of lessons learnt no doubt within H1 of 2020, but have those experiences equipped us for what we are facing now, or in 2021?
In July 2020 the FCA reported, ‘while many firms have made significant progress in how they treat vulnerable consumers, there is still room for improvement and more consistency across the sectors we regulate. Evidence from consumer organisations and our own regulatory work shows that some firms are failing to think about vulnerability or ensure the fair treatment of vulnerable consumers is fully embedded into their business. As a result, there is inconsistency in the way vulnerable consumers are treated‘.
So, what is it that firms are expected to do exactly? The FCA states that ‘firms can expect us to ask them to demonstrate the actions they have taken to:
- understand the needs of their target market/customer base
- ensure their staff have the right skills and capability to respond to the needs of vulnerable customers
- respond to consumer needs through product design, flexible customer service provision and communications
- monitor that the needs of their vulnerable customers are being met and responded to, collect information on the impact of their policies and processes, and assess how they are resulting in good outcomes for vulnerable consumers‘
So, continued staff training and support, raising awareness, systems capability, policy and process review, data analytics and insight all play a part in ensuring that business is doing the right thing. Critically, the first step is to be able to clearly identify vulnerability in the first place. There are a few ways of getting this process off on the right footing-
- Empathetic, well-trained staff who are given the time and encouragement to treat every customer as an individual.
- Call analysis to identify verbal clues within the conversation can be a strong indicator of potential vulnerability.
- Web analytics to completely understand the digital customer experience and challenges.
- Customers themselves may identify their own vulnerability through completion of surveys through a robust and comprehensive Voice of the Customer program. (we often find that customers will report things in surveys, which they may have been reluctant to discuss with the call agent).
In the next instalment of these blogs, I’ll be taking a look specifically at how VoC can help to identify and flag customer vulnerability for you – enabling you to either validate and document what you’re doing already or perhaps getting one step closer to providing the right care and consideration as identified by the FCA.
In the meantime, if you want to know more about Davies and our VoC programmes, please get in touch.