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| New Survey Documents Toll of Economic Crisis on Customer Relationships With Banks, Outlines Steps To Rebuild Trust and Confidence |
S1 Enterprise Establishes 'Banking Relationship Score,' New Benchmark for Strength of Customer-Bank Relationships NORCROSS, Ga. and The crisis in the financial sector is also driving a sea change in the top driver for consumer banking relationships. Historically, consumers have selected 'Convenience' as their top reason for choosing a bank.* The new survey found that for U.S. consumers, this perennial 'number one' has been pushed to third place behind 'Financial Stability' (65 percent) and 'Trust' (54 percent) and only a few percentage points higher than 'Customer Focused' (47 percent). This data underscores the need for banks to draw closer to their customers in terms of communicating the institution's financial health as well as demonstrating an understanding of customer needs and expectations. Titled 'Banking Relationships: An Era of Change,' the survey was conducted
by third-party research firm, 'Banking Relationship Score' Shows Relationships At Risk The survey also establishes a new benchmark for tracking the strength of the relationship between banks and customers. The Banking Relationship Score (BRS) is a multi-dimensional measurement that combines three stated and emotional factors: trust in one's current bank; likelihood to continue with one's current bank; and likelihood to recommend one's current bank to others. The overall Banking Relationship Score for U.S. financial institutions came in at just over 55, well into the 'at risk' zone and 20 points below the target range of 75 or above which designates strong relationships. European financial institutions scored even lower, with a BRS below 28. A proxy for the health of the overall banking relationship, BRS scores
fall into one of three ranges developed by
-- Strong Relationship = a score of 75 or higher
-- Neutral Relationship = a score of 60 to 74
-- At-Risk Relationship = a score below 60
"The severity of the downturn for financial institutions has clearly
eroded key components of the banking relationship, while increasing the
importance of emotional drivers like trust," said Read Ziegler, president and
CEO of "Banking relationships are clearly at a crossroads," said The results highlight the growing importance of banks building back trust and confidence through a greater focus on customer intimacy across all banking channels (online, mobile, branch/teller and call center). For example, when asked their preference for interacting with their banks, a majority of consumer respondents (41 percent) said 'in person at the branch,' followed by a more even split between a combination of in person and online (28 percent) and online only (23 percent). The survey results suggest specific steps that banks can take to build stronger customer relationships. These include tailoring communications, services and the overall banking experience to individual customer segments across all delivery channels. This means banks will need to better harness data and analytics for deeper insight in order to provide advice about how customers can better manage their financial lives. "The research suggests banks should strive to create a culture of customer advocacy, one that promotes proactive service, honesty and greater transparency into a bank's financial health," added Moore.
Other top findings from the survey include:
-- Overall, only 16 percent of U.S. consumers indicated they were feeling
positive about an economic recovery within the next 12 months.
-- While 70 percent of U.S. consumers say they're likely to stay with
their current bank, only 50 percent would actually recommend their
current bank to someone else. Another 25 percent say they'd be more
likely to dissuade someone from becoming a customer.
-- When broken down by demographic factors, the Bank Relationship Score
model revealed that young, affluent males with less than three
accounts with their primary bank represent the customer group at
greatest risk for defecting.
-- The survey of corporate banking customers found 'Trust' to be the
number one factor in building valuable banking relationships (70
percent of corporate respondents). As the financial landscape
continues to shift, 50 percent of corporate respondents noted that
they intend to keep their banking relationships limited to a small
group of less than five institutions (the smallest option available on
the survey questionnaire).
-- Only 41 percent of large corporations indicated they would be likely
to recommend their financial institution to a friend or colleague, and
only 46 percent noted that they are likely to continue a relationship
with their bank.
* Source: Compete About S1 Enterprise More than 100 banks and three million consumer, small business, and
corporate users worldwide rely on S1 Enterprise solutions to access and manage
their financial information. A division of About
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