Mike Todd, chief executive of Volkswagen Financial Services UK, says the automotive sector needs to ensure the Consumer Duty standard remains a driving force for continual improvement as it looks to meet the changing demands of customers.

The summer of 2023 saw the introduction of the Financial Conduct Authority’s landmark Consumer Duty standard which is viewed as the biggest overhaul for the UK’s financial services industry for over 20 years.

Its intentions are clear - improve consumer protection for financial services firms in the UK and ensure that the financial services sector strives to deliver good outcomes for retail customers.

Consumer duty acts as a regulatory-driven reminder of the central importance of customers and is helping to drive a renewed focus on the industry’s most important stakeholder.

And while everyone across the industry has been working hard to prepare plans, re-examine customer interactions, and investigate product outcomes in the lead up to the new standard’s implementation, the hard work is only just beginning.

Not a one off

As the Financial Conduct Authority has reinforced in subsequent communications, Consumer Duty is not just a ‘once and done’ exercise. It must be a living, breathing and continually developing approach that underpins a customer-centric strategy. It is therefore binding on all to ensure this remains the case, avoiding the potential for other business pressures and priorities to divert attention and resources away from this critical area.

At VWFS, we are making sure this is the case under our ‘Customer Promise.’

Our Customer Promise: To make mobility easy, simple and transparent for every customer in each moment.

Across the business, it is the overarching principle by which we interact with our customers, design our processes, and develop our products. Constantly championing the customer sits at the heart of our daily operations and the customer promise is enthusiastically embraced by our colleagues as they acknowledge its strategic importance to our business, our sector and, indeed, our industry.

Whether we’re dealing with our customers directly, or via one of our dealer partners, the ethos is the same. Are our products easy, simple, and transparent? Are we doing everything to ensure that the customer promise we make is acted upon and that our customers benefit from authentic, integrity-driven, and purposeful outcomes?

Look outwards

Embedding our Customer Promise as an active and measurable contribution to meeting the expectations of the Consumer Duty directive is touching all areas of our operations. Each area of our business has personalised the promise to their department to ensure they have a clear customer focus that aligns to what they do day in day out.

It can be easy to design solutions, products and services that complement internal systems, processes, and commercial targets, but they may not necessarily make it easier, simpler, or more transparent for the customer.  This is being turned on its head as we commit to a continual evolution that will only lead to sustained service excellence for customers.

Choice is king

For automotive brands out there it’s important that any customer-centric approach chimes with what customers are now demanding: the availability of true choice. The old days when choice in the industry was purely related to physical aspects such as vehicle size, model, brand etc, have been supplemented.

Today’s true choice demands that we embrace usership, as well as ownership. From two-day car hire to car loans covering multiple years, consumer needs are changing and whether they want short-term access to a vehicle or a longer-term solution, product development must be focussed on making sure true choice and customer empowerment is accessible.

It will be the companies that can marry continual product innovation to ensure choice demands are satisfied, with a service ethos that supports the transparency, ease and simplicity objectives enshrined in the FCA’s Consumer Duty regulations, who will succeed.

The standard signposts the direction of travel for the industry. It is up to all of us to ensure that the delivery of customer satisfaction becomes the tangible destination.

Author: Mike Todd, chief executive, Volkswagen Financial Services UK

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