Customer Service Evaluation Results from Canadian Discount Brokerages in 2012
Dalbar Canada has exclusively provided SparxTrading.com with the average score from their 2012 evaluation along with where all Canadian discount brokerages tested landed relative to this industry average. The following graphic describes the results obtained:
The winner from the past year was HSBC Invest Direct scoring 78.54 out of 100. Interestingly, RBC Direct Investing, which had won this award for 5 consecutive years prior to HSBC Invest Direct, was a close second at 77.17. Both BMO InvestorLine and TD Waterhouse Discount Brokerage also managed to score above average.
As the diagram illustrates, the majority of discount brokerages covered here are subsidiaries of larger Canadian financial institutions. Interestingly, in terms of service experience two independent discount brokerages (Qtrade and Questrade) as well as several major bank-owned brands scored under the average, suggesting that size doesn’t necessarily translate into better service.
Does Dalbar’s Customer Service Evaluation Measure What it Claims to?
For the most part, the components that constitute the Direct Brokerage Sales Effectiveness program reasonably approximate the kinds of things one would expect to happen when calling up a discount brokerage and interacting with a staff member on the other end.
It is reasonable to expect that most clients would want to have their issue(s) properly understood and addressed. It also seems reasonable that being treated as a customer (i.e. being addressed by name) rather than a number would make for a more pleasant interaction. Exactly how important each of these components might be likely varies between people, however the criteria and the method (multiple measurements conducted throughout the year) to measure them seem appropriate.
Conflicting Opinions on Discount Brokerage Service
While the process used to sample and measure customer service experience is highly structured, there are conflicting data points from evaluations conducted by Surviscor, another organization which conducts Canadian discount brokerage rankings, which bear mentioning. For example, RBC Direct Investing had been the winner of the Dalbar Direct Brokerage Service Award for five years straight (from 2007 to 2011) however in the 2012 Surviscor evaluation of direct brokerage response times, RBC Direct Investing had response times by email of greater than 16 hours. Differences in methodology, scoring and definitions of what a “complete” answer from a customer service agent means could explain the discrepancy. Also, while email response times and telephone customer experience aren’t necessarily related, they do reflect two different means by which customers interact with their discount brokerage.
The fact that there is such a large discrepancy between evaluations highlights why it is important to find out how measurements are conducted and ask what exactly is being measured. As a case in point, according to Dalbar’s research, individuals sometimes don’t mind waiting a bit longer to get an answer so long as the answer that they are getting actually addresses their needs satisfactorily. Thus, how long a response takes may not trump the value of having the desired outcome from the interaction.