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TheStreet Open House

How Bank of America Can Win Back Customers

Stocks in this article: BAC

NEW YORK (MainStreet) -- Netflix (NFLX) hasn't exactly been a model of consumer friendliness during the past several months, but there was at least one thing the company did right during the price hike and aborted Qwikster experiment: clear communication. As customers raged against the now-infamous 60% price hike, CEO Reed Hastings emailed Netflix's customers in an attempt to placate them.

"I messed up. I owe everyone an explanation," he wrote in September. "I offer my sincere apology."

Bank of America has been quiet in defeat after the debit card fee debacle, but there are some things the bank should be saying.

Bank of America (BAC), of course, recently found itself dealing with similar customer revolt after it announced in September a planned $5 per month debit card usage fee starting in 2012. Unlike Wells Fargo (WFC), which tested a $3 monthly debit card fee in several states to gauge customer reaction, Bank of America did not test the fees before the plans were announced, and after weeks of relentless criticism and customer defections, abruptly reversed course Tuesday, announcing it would kill the proposed fee and had no plans to resurrect it. In contrast to Netflix's correspondence with its customers, the announcement was terse and to the point, with the bank's co-chief operating officer David Darnell noting that "We have listened to our customers very closely over the last few weeks and recognize their concern."

For some consumers, simply killing the fee won't be enough to repair the relationship.

"They have a long way to go to build back that trust," says Ira Rheingold, executive director of the National Association of Consumer Advocates. "They need to say, 'We're sorry, we need to listen better, and we're interested in establishing a long-term relationship with you.'"

For Rheingold, the proposed fee was just the most public manifestation of what he sees as a worrying trend among the large banks, in which deposit customers and mortgage holders are treated as profit engines -- "their own version of cash machines," in his words -- rather than as partners in a relationship. It's a trend that's manifested itself in the form of shady mortgage servicing practices, but it wasn't until this latest move that the majority of customers began to take notice.

Perhaps it's unreasonable to expect Bank of America to apologize for a fee it never wound up implementing. But Bank of America customers will be acutely sensitive to any attempts to turn a profit at their expense in the future.

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