A New Era of Customer Expectation_global Consumer Banking Survey

8/6/2019 A New Era of Customer Expectation_global Consumer Banking Survey

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A new eraof customerexpectation

GlobalConsumerBankingSurvey 2011



Introduction 02

Executive summary 05

Rebuilding brand perceptions 13

Preventing customer attrition 19

Enhancing the customer experience 24

The competitive landscape 29

Conclusions 31

How Ernst & Young can help 33

Methodology 34

At a glance and contacts 37



Since the start of the economic crisis allorganizations, and banks in particular, haveexperienced huge challenges in maintainingexisting customer relationships. The crisis hasdirectly affected customers’ perceptions of theirbanks and the way that they interact with theirproviders. We have seen the emergence of a newpost-crisis customer with a clear focus on brandintegrity, value for money, and quality of service.Banks now need to deliver a more efcient,customer-focused and innovative offering thanever before to reconnect with their customers.

At the end of 2010, Ernst & Young conductedour rst-ever global survey of customer behaviorin retail banking, the results of which are detailedin this report. Following up on previous researchconducted across six European countries and areport titled Retail banking in Asia Pacifc thatcovered Australia, mainland China, Hong Kong,New Zealand and Singapore, this is our mostcomprehensive study yet of customer behavioracross major markets.

We surveyed more than 20,500 individuals inEurope, the US, Canada, China, Japan, India,Latin America and South Africa. In line withour previous reports, which identied clearopportunities for banks to build increasedadvocacy and loyalty among their customers,we have once again asked our participants abouttheir relationships with their banks.

We specically asked respondents about theirlevel of satisfaction, what they are lookingfor from institutions, and their intentions anddemands going forward.

We conducted this research

with the objectives o:

• Highlighting the risks and opportunities facingthe retail banking sector today

• Analyzing what is relevant to a successfulbanking relationship, so that banks can achieveand maintain customer satisfaction in the new

climate

• Identifying and commenting on what we seeas the key actions that banks must take toretain and expand their customer base in thischallenging and increasingly sophisticatedmarket

We would like to thank the participants for theirvaluable time and insights, and we hope thatthese ndings will assist the banking sector tomanage change and drive growth as it embarkson a new era of bank-customer relations.

Please contact one of our countryrepresentatives for further details andinformation on what this means for yourorganization and region.

Ernst & Young Global Consumer Banking Survey10,021 Europeans | 4,018 Latin Americans 2,001 Americans | 1,008 Japanese1,003 Canadians | 1,000 Chinese1,000 Indians | 503 South Africans

Ernst & YoungGlobal ConsumerBanking SurveyA new eraof customerexpectation

02



03



Globally, retail banks areentering a new era. Thechallenge remains to keep thecustomer experience and widerbrand perceptions central to allstrategic thinking.

04



Retail banking is a regional business directlyinuenced by local cultural drivers, so globaltrends are few and far between. We have foundhuge differences between the customers ofthe developing world and those in the maturemarkets. Nevertheless, as consumer behaviorsbecome more homogenized and bankslook to new markets, we believe there areopportunities to learn from the experiencesof other economies. It is clear that as banksconsider ways to rebuild trust, improve serviceto meet customer expectations, and reduceattrition, their efforts will need to be carefullytailored to the unique requirements of eachdomestic and regional market in which theyoperate.

For banks to compete, differentiate and growin this new customer era, they must swiftlyaccelerate their innovation around bankingproducts and service offerings. Those thatdo so will enrich their brands and protectand increase market share at a time whencustomer loyalty is no longer guaranteed.

This report highlights some of the key issuesthat need to be addressed as the retail bankingindustry of the future takes shape.

Rebuilding customer confdence

and the power o the brand

Our ndings highlight the intense and ongoingimpact of the credit crisis on trust levels whiledemonstrating the dichotomy across localbanking markets in the mature and emergingcountries.

• Globally, 44% of customers say theircondence in the banking industry decreasedin 2010

• Within Europe, the UK (63%), Germany(61%) and Spain (58%) have seen thelargest falls in customer condence

• However, in emerging markets trust hasrisen, with 75% of respondents in India, forexample, saying their trust in banks increasedlast year

The banking industry in mature marketshas witnessed a wholesale and ongoingshift in condence, and never before hasloyalty management and personal customerattention been such an issue for the sector.In contrast, the emerging markets now offerhuge opportunities for banks looking to expand

internationally, as most have felt less of animpact from the credit crisis and instead havea growing middle class of customers looking todiversify their bank relationships.

Rebuilding trust is a challenge for individualbanks and for the industry as a whole, inparticular across mature markets. Negativecustomer perceptions of the disruption bankshave caused to the wider economy, throughthe under-capitalized and over-leveragedpractices that led to the credit crisis, continueto prevail. In recent years, we have seen thatbeing protable is not enough. The role that

banks play in supporting the wider economyhas been highlighted, and a wide variety ofstakeholders are now demanding a moreresponsible banking industry if there is to be arestoration of customer condence.

Executive summaryGlobally, retail banks are entering a new era. Setting outa clear strategy is becoming more difcult as regulatoryand political intervention changes the market structure,and banks are under enormous pressure to restore publiccondence in the role that they play in society. As banks

respond to these structural pressures across markets andstrive to obtain a competitive advantage, the challengeremains to keep the customer experience and widerbrand perceptions central to all strategic thinking.

05



World

44%

Europe

50%

US

55%

Brazil

18%

India

8%

China

30%

Since the fnancialcrisis, what has beenthe decrease in trustlevels toward fnancialinstitutions?

06



Executivesummary

At the same time, regulatory change atthe macroeconomic level is signicant, andconsumer protection laws and other legislativedevelopments are taking shape across major

jurisdictions, with implications for cross-borderproduct and service development. Addressingcustomer protection has been at the core ofthe G20 initiatives in the mature markets post-crisis, and the advent of consumer protectionagencies, proposed in countries such as theUS and the UK, might increase this evenfurther, with the potential to introduce productregulation.

These regulatory changes have been highlypublicized, and we are seeing customerstaking a much closer interest in the “values”of their bank, particularly around executivecompensation in some mature markets, whererestoring trust is a big issue. Our ndings showthat the banking industries of the UK and US inparticular witnessed a huge drop in condencelevels as a direct result of remunerationpolicies, with 80% and 69%, respectively, citing

this as one of their reasons for a loss of faith intheir banks.

Regardless of the impact of customer trustlevels across the globe, the importance of abank’s reputation and image is evident in allmarkets. Globally, brand strength was cited asthe main reason for choosing a bank by 39% ofthose surveyed. A strong brand is particularlyimportant in such markets as India, Brazil andSouth Africa, which are witnessing an inux offoreign institutions, and in certain Europeancountries such as the UK and Spain, whichhave seen consolidation in recent years.

With brand strength important globally andgiven that it is much easier to damage abrand than to repair one, it is increasinglyessential for banks to continue to develop andexecute comprehensive brand enhancementprograms. These initiatives need to reinforcecustomer values and deliver on obligationsto the “home” economy through pragmaticand measurable steps. Activities must beeffective at both a national and local level, forexample, fullling national customer charterswhile at the same time showing demonstrable

commitment to the local business community.

Tackling accelerated attrition

Attrition rates continue to rise following thenancial crisis, but it appears that withinmature markets attrition is set to slow, andindeed customers are holding an increasingnumber of products with their main bank. Theincrease in product holdings across maturemarkets is good news, as it implies that loyaltyto the main bank relationship has endured,despite the considerable decrease in marketcondence.

• Globally, 36% of customers have changedtheir main bank in the past, and 7% ofcustomers are planning to leave their bank

• Indian and Chinese customers are more likelyto move in the future, with 11% and 13%,respectively, thinking of switching their banks

• Attrition in mature markets is slightly lowerthan the global average, with 5% of UScustomers, 5% of German customers and 6%of UK customers saying they plan to leave

• Globally, 81% of customers hold two or moreproducts with their main bank, with moredoing so in Spain, Belgium, France, Canadaand South Africa

In this era of new expectations, we see 48%of customers around the world planning tochange banks because of general levels ofservice, and 43% because of price. Otherfactors include product offerings, the proximityof branches and a lack of trust in the existingbank relationship. Almost a quarter of

respondents (22%) who have moved theirmain bank attribute their decision to a loss oftrust.

In order to drive customer value and reduceattrition, much-improved leverage of customerdata and insight will be critical, as tailoredoffers and service propositions are likely tobe positively received by customers. Targetedswitching offers will still be a rich source ofnew customer acquisition, while setting anddelivering clear customer standards that aremarket-leading will pay dividends in terms ofcustomer acquisition and retention.

07



Customers whohave changedtheir main bank

World

36%

Europe

39%

US

38%

Brazil

40%

India

13%

China

27%

08



Executivesummary

Delivering a successul banking experience

Despite service quality being a key attritionlever, efforts by banks to improve the qualityof service they deliver have not yet resultedin improved customer perceptions. Mostcustomers continue to feel that they are notgetting the level of personalized service theywould like.

• 43% of customers say they get no, or onlyoccasional, personal attention from theirmain bank

• The personal attention received in emergingmarkets seems to be signicantly better,with 81% of Indian respondents saying theyreceive good or very good personalizedservice

Customers are open to greater communication,provided it is relevant and pertinent to theirpersonal circumstances. When it comes tochannels, customers are responding positivelyto the convenience, accessibility and reliabilityprovided by digital channels, and particularlythe internet and ATMs.

• Internet banking (83%), ATMs (79%) andbranches (79%) are the channels with thehighest levels of customer satisfaction

• Globally, 42% of customers never use mobilebanking

• Call centers are not popular, with only 52% ofcustomers satised with their services and30% never using them

When dissatised customers are asked howthey would like to see channels improved, 40%want branches to deliver better service and39% want them to be more available. We found43% of disaffected customers want betteraccess to ATMs, a third want websites that areeasier to use, and 46% are demanding higher-quality service from call centers.

Customers are expecting the technologiesbehind the convenience and reliability ofdigital channels to deliver the same qualityand personalization they have come to expectacross other channels. Practical innovationsacross channels that leverage technology todeliver a more seamless and personalizedexperience will therefore be a majorcompetitive battleground in all retail bankingmarkets. This means building on existinginternet applications to drive enhanced callcenter and branch fulllment, which willin turn enable a fresh look at segmentedcustomer communications. This will allowthe deployment of new customer treatment

strategies – using mobile, email and socialmedia – to drive appropriate cross sales andretention outcomes.

Services and applications that allowcustomers to better manage their nanceswill be signicant customer satisfactiondifferentiators, and will simultaneouslyreinforce a bank’s commitment to moreresponsible banking.

Q. What channels are you most satised with?

Internet banking

Satisied

83%

ATMs

Satisied

79%

Branches

Satisied

79%

World

09



An agile approach

Our ndings highlight the signicantdifferences that exist between customers indifferent markets and the difculties facingbanks as they expand across borders. Inmany cases, the difference between customerexpectations in emerging markets and those inmature markets is particularly stark. Globally,

however, we see consumer demands rising andorganizations the world over having to adapttheir business models to be more exible tokeep up with the pace of change.

Our ndings identify some key areas of focusfor banks in an increasingly complex customerenvironment, with clear priorities emergingaround:

• Rebuilding trust

• Focusing on brand-building

• Segmenting the customer base to furtherpersonalize the product offering

• Making enhancements to service quality,particularly through the use of remote

channels The industry needs to be agile to meet ever-increasing and ever more demanding customerneeds. It may be that attrition and low levelsof loyalty are a fact of life, but at a time whenit is widely expected that banking returns willfall, the industry clearly needs to reshapeif it is to bring service in line with customerexpectations against such a challengingmacroeconomic backdrop.

Executivesummary

Banking trends:

Mature and emerging markets

In the emerging markets, trust in nancialinstitutions has endured, and customers arediversifying their portfolios, accessing moreproducts and banking with more providers.We are seeing some major banks in maturecountries putting growth in the emergingmarkets high on their agenda, while othersremain focused on restoring their balancesheets to meet stricter capital requirementsand repay government bailouts in home

markets.

Providers that can offer the growing ranks ofdiscerning customers in emerging marketsa combination of low-cost banking, brandstrength and personal attention will benetfrom considerable expansion opportunities inthese new economies.

Mature markets

• The effects of the credit crisis have had alarge impact on the reputation of banks

• Customers are largely dissatised with theremuneration policies of banks

• Customers are more likely to bank with asingle provider

• Customers put channel efciency and

personalization ahead of price as a driver ofsatisfaction

• Attrition levels have been high but look set toslow

• Uptake of mobile banking is small

Emerging markets

• The credit crisis has had a limited impact onthe reputation of banks

• Customers are making investments in bondsand pension contributions as opposed tosavings

• Price, brand strength and personal attentiondrive satisfaction

• Customers bank with a large number ofinstitutions

• In some emerging markets, there is awillingness to pay for independent nancialadvice

• Mobile banking is more popular

10



11



With the economic environmentstill challenging in many localbanking markets, it is morecritical than ever that institutionsmaintain strong relationshipswith their customers.

12



55% 9% 36%

India

8%

75% 17%

Rebuilding brand perceptions With the economic environment still challenging inmany local banking markets, it is more critical thanever that institutions maintain strong relationships withtheir customers. However, across the world, 44% ofrespondents tell us that their condence in the banking

industry has declined further in the past 12 months, withthe western markets of Europe and the US the most badlydamaged. With the power of the brand also emerging asa key factor when customers choose their main bank, itis clear that institutions need to invest in restoring theirreputations and repairing their brand images.

13

World

Decrease

44%

Increase

13%

43%

Impact o the crisis on trust levels in fnancial institutions

Q. How has your condence toward the banking industry changed over the past 12 months?

No impact

Decrease Increase No impact




Rebuilding brandperceptions

Confdence correlations

Our research shows a correlation betweenthe depth of the recessionary pressure placedon local economies and the resulting impacton customer condence in local banks: forexample, in the US 55% of customers haveless condence in banks than they did a yearearlier, while 75% of respondents in India saytheir trust in the banking industry in theircountry has grown during 2010. Emergingmarket economies have suffered less from thecredit crisis than some of their more maturecounterparts, and so their banks have seentrust endure.

This dichotomy in trust levels across localbanking markets in mature and emergingeconomies may in part be attributed to theemerging markets enjoying huge investmentsin their banking sectors as global institutionsidentify opportunities for growth, at a timewhen large government bailouts have beennecessary in some of the mature markets. It

could also be inuenced by banks in emergingmarkets still being strongly associated withentrepreneurial endeavor, because they areoften seen to be nurturing and supportingwealth creation in the wider economy.The background to the economic crisis and

the remuneration policies that exist withinthe banks are the key reasons why customershave lost condence in the industry in maturemarkets. Across the world, more than halfsay their faith in banks has been dented formacroeconomic reasons, with a further 49%pointing to dissatisfaction with the bonusculture at the banks as the reason for theirdecrease in trust. Customers in the US and theUK in particular point to bonuses as the reasonfor loss of condence in their banks.

Where trust in emerging countries has beennegatively impacted, a signicant numberof respondents cite the level of service andproduct offerings from the banks as the reasonfor their dissatisfaction.

A healthy, efcient and well-managedbanking sector is vital for economic recovery,yet it is clear from our research that evenwhen the current negative perception hassubsided, banks in mature markets willneed to continue to rebuild the trust that

they once took for granted. Whether thisinvolves greater transparency around bonuscompensation, increased efforts to supportentrepreneurial activity, or other initiatives,brand enhancement programs that reinforcecustomer values will certainly be necessary.

Canada

25% 12% 63%

Brazil

18% 33%

China

30% 23% 47%

Japan

32% 3% 65%

South Africa

47% 22% 31%

14

Europe

50% 7%

aLatin Americ

31% 27% 42%

43%

We have included data forBrazil in addition to the

Latin American data so

comparisons can be made

across the key emerging

countries of Brazil, India

and China.


Decrease Increase No impact Decrease Increase No impact Decrease Increase No impact

Decrease Increase No impact Decrease Increase No impact Decrease Increase No impact

49%



Customers withonly one main bank

World

41%

Europe

46%

US

51%

Brazil

34%

India

12%

China

4%

15



The “main bank” relationship

Our results also highlight the differences in“main bank” relationship behavior betweencustomers in Europe, the US and Canada andcustomers in emerging markets, with Westerncustomers having a much higher tendencyto bank with a single provider than theiremerging markets counterparts.

Despite the declining trust in the bankingsector of mature markets, more than half ofUS customers source all their banking productsfrom one institution, while in Europe 46% ofcustomers do so. The difference in behaviorin emerging markets is stark. In China, 96% ofcustomers bank with two or more providers;in India, 88% use two or more banks, while inBrazil 66% do.

This trend in emerging economies may beattributable to the arrival of new providers inthese markets, both Western and domestic,while consolidation in the banking industries of

more mature economies could be restricting

customer choice. Our respondents may alsobe reacting to a more challenging lendingenvironment by attempting to build a strongerrelationship with a single provider in order togain credit.

Customers in some emerging markets aremore willing to pay for independent nancialadvice than customers in other geographies.For example, 60% of Chinese and 55% ofIndians would pay for advice, while in Europeonly 23% of customers are willing to do so.We believe it is the expanding middle classes inemerging markets that are driving this trend,while the evolving premium banking services inmature markets mean that such advice is nowconsidered part of the basic bank offering thatcustomers have come to expect. This raisesan interesting dilemma for banks, because asmargins increasingly come under pressureacross many local markets, banks need to nda way to offer transmission, savings, borrowingand nancial guidance to customers eventhough they appear unwilling to pay for the

personalized advice they receive.

One

51%Two

33%Three

12%Three +

4%4%

South Africa

One

44%Two

43%Three

11%Three +

2%

Latin America

One

34%Two

46%Three

15%Three +

5%

Japan

One

7%Two

25%Three

38%Three +

30%

India

One

12%Two

46%Three Three +

13%

Canada

One

48%Two

37%Three

11%Three +

4%

China

One

4%Two

23%Three

42%Three +

31%

Brazil

One

34%Two

47%Three

14%Three +

5%

World

One

41%Two

38%Three

14%Three +

7%

Europe

One

46%Two

38%Three

12%Three +

Number o banks

Q. How many banks do you bank with?


16

29%



Strong brand, low cost

Across the world, respondents rated brandstrength and low cost as the most importantcharacteristics of their main bank. Globally,brand strength was the most powerful, with39% of respondents identifying it as thenumber one characteristic of their main bank,closely followed by low cost (36%).

Brand strength is particularly important tocustomers in the emerging markets of India,Brazil and South Africa. All of these retailbanking markets are witnessing an inux offoreign brands going into competition with

domestic incumbents. In Brazil, two-thirds ofrespondents (66%) say their main bank has astrong brand, while more than half of Indian,Chinese and South African respondents saythe same thing.

In Europe, brand strength is particularlyimportant in the UK (45%), which was hithard by the credit crisis, and in Spain (44%),where there has been a lot of consolidation inthe banking sector. As a result, we are seeingthe current market turmoil in these countriesdriving customers toward big, well-knownbrands.

29%

39%

11%

22%

26%

36%

24%

36%

9%

21%

23%

36%

22%

61%

18%

23%

32%

32%

31%

36%

12%

22%

31%

47%

World Europe Latin AmericaCanada

32%

41%

12%

23%

35%

37%

Main bank descriptionQ. Which characteristics best describe your main bank?


= Low cost

= Excellent productknowledge

= Independentadvice

= High rate of

return knowledge

= Strong brand

= Strong focus onsustainability

17



Restoring brand confdence

• Brand enhancement programs – Allelements of the customer experience, atboth the national and local level, need tobe reassessed with continued investmentsmade in customer charters and innovativeapproaches to marketing the bank’s ethosand service offering.

• Personalizing banking – Personalization

is a vital element of a successful customerrelationship, and a cohesive approachto the development of tailored productsand services will help to improve brandperception.

• Brand ambassadors – To ensure that thesales force represents the bank’s brand, thereneeds to be a continued focus on transparentand sustainable incentive models and on anadequate customer relationship model.

• Online innovation – Adopting a coherentsocial media approach will help improvebrand perceptions and leverage the benets

of online advocacy.

25%

66%

15%

25%

33%

46%

46%

52%

41%

43%

53%

34%

51%

50%

39%

21%

48%

26%

62%

18%

7%

13%

11%

20%

23%

51%

8%

17%

23%

27%

Brazil India China Japan South Africa

18



Preventing customer attritionGlobally, attrition levels are signicant, with 7% ofcustomers worldwide planning to change their main bankand the number of Europeans who have ever changed theirmain bank up 15% compared with a year earlier. It is clearthat customers are increasingly willing to move if they are

dissatised with their current banking provider. Financialinstitutions that can deliver a service that is of high quality,while being personalized and competitively priced, will bethe ones that succeed in the new post-crisis world.

Attrition in banking

Q. Have you ever changed your main bank?

Latin America

Yes

33%

Planning

9%

No

58%

Canada

Yes

38%Planning

5%No

57%Yes

38%Planning

5%No

57%

Japan South Africa

Yes

34%Planning

10%No

56%Yes

24%Planning

4%No

72%

Brazil India

Yes

40%

Planning

7%

No

53%

Yes

13%

Planning

11%

No

76%

Yes

27%

Planning

13%

No

60%

World

No

57%

Planning

7%

Yes

36%

39%Planning

7%NosYe

Europe

Time or a change

We asked our participants if they have everchanged their main bank, and 36% said thatthey had, with a further 7% of worldwiderespondents saying they are planning to change

their main banking relationship. Countries inemerging markets benet from the lowestattrition rates to date, with the majority ofcustomers in India, Japan and China sayingthey have never changed their main bank. Yetin India and China, more than 1 in 10 customersare now planning to move their main banking

relationship, suggesting increased futuremobility among the customer base. In contrast,

just 5% of customers in the US and Canada areplanning on switching their main bank.

In Europe, attrition rates have risen in the past

12 months, but the percentage of customerswho now plan to leave has reduced. Today,39% of Europeans say they have changed theirmain bank in the past, and there are signicantincreases in attrition in Spain, the UK, theNetherlands and Germany when comparedwith the results of our survey a year earlier.

China

19

54%



Preventingcustomer attrition

Reasons or attrition

Q. What are the main reasons for attrition for those who have changed their bank or are planning to change?

However, while attrition rates have continuedto rise since the nancial crisis, it appearsthat within mature markets attrition ratesare set to slow with, for example, a reductionin the number of customers who now plan toleave their main bank in Italy, Spain and theUK. This could be attributed to the fact thatthese markets have witnessed considerableconsolidation and change of ownershipamong nancial institutions in the past year,with many small and local banks acquired bylarger brands.

Reasons to switch

Service quality is the biggest cause ofcustomer attrition, with 48% of worldwidecustomers who are planning to changetheir main bank citing this as the reason.Customers were able to give more thanone reason for leaving or planning to leavetheir main bank, and 96% of South African,83% of Indian, 80% of Chinese, 79% of LatinAmerican and 60% of European customers

cite general levels of service quality or aspecic service failing as the reason for theirdissatisfaction.

Price is the second major factor inuencingattrition rates, with 43% of those planningto change banks citing it as the main reasonand 36% who have already changed saying itwas the reason that they switched. Other keyreasons are product and service offerings,the proximity of branches, and a lack of trustin the existing bank.

South African customers are the mostsensitive to price, with 57% citing it as amain reason for a change of bank. AcrossEurope, the majority of customers inemerging Eastern European markets likeHungary and Poland say price is the reasonfor attrition, while in the UK, France andSpain service quality is the key reason.

French, British and Dutch customers arethe least sensitive to price and, indeed,for Europe as a whole, more than half ofcustomers move for reasons other thanprice. We see a demand from customers formore clarity and transparency on charges,

and with the potential for new consumerprotection agencies across both the US andEurope, we may be about to witness evenmore regulation on pricing and chargesacross the mature markets.

Havechanged bank

22%Planningto change

25%

General levels

of service quality

A specific

service failing

Havechanged bank

41%

Planningto change

48%

Havechanged bank


22%

Lack of trust

Price

Havechanged bank

36%

Planningto change

43%

Products and services

on offer

Havechanged bank

31%

Planningto change

36%

Havechanged bank


20%

Proximity

of branches

20




Increasing fdelity

Generally, customers who hold more productswith their main bank are likely to be the mostloyal and unlikely to leave. We asked ourparticipants how many products they holdwith their main banking provider, and 81%of respondents globally say they hold two ormore.

More customers in the US, the UK and Japanhold just one product with their main bank, at23%, 25% and 34% of respondents respectively,perhaps because they feel little incentive tobuy more products from their banks. Bankscould adjust their value propositions through acombination of product bundling, pricing andaccess to value-added services so as to makemultiple product holdings more valuable totheir customers. However, any such innovationwould need to be undertaken in the context ofregulatory developments, which are leading adrive toward clarity and simplicity in productofferings.

Within Europe, product holdings with the mainbank have increased since our survey last year,perhaps driven by consolidation in the marketand the disappearance of certain banks fromthe high street. This shift is particularly obviousin Italy, where we have seen the number ofcustomers holding two or more products withtheir main bank rise from 75% to 85% in the

past 12 months, and in Spain, where the gurehas risen from 86% to 93%.

This increase in product holdings is good newsfor bank loyalty, as it encourages strongerlinks with the main bank. To build on it,banks should continue to improve the salesforce effectiveness within their organizationby addressing transparent and sustainableincentive models, implementing lean andtargeted customer relationship managementand developing new sales channels usinginnovative technologies. Bank employeesshould be better equipped with the knowledge,skills, technology and motivation to turncustomers into advocates and increase theirdelity and loyalty.

The product mix

To help prevent attrition, banks need to refocuson whether they are offering customersproducts that meet their individual needs andreect the changing economic landscape. That

said, it is clear from our research that the crisis,and the resultant loss of consumer condence,does not appear to have impacted the productportfolio decisions of customers around theworld. We asked our respondents whether theyare moving to more secure products, such asbonds and increased pension contributions, and

just a third said they were moving to this morecautious product mix.

World

61%

39%

73%

27%

South Africa

52%

48%

Latin America

69%

31%

Japan

54%

46%

India

27%

73%

Europe

64%

36%

China

21%

79%

Canada

69%

31%

Brazil

58%

42%

Move to more secure products and investmentsQ. Are you moving to more secure products, such as bonds and increased pension contributions, than in the past? = Yes = No

21



It is interesting to note that in the emergingmarkets of India and China, the uptake of moresecure products is much higher, with 73% ofIndian respondents and 79% of Chinese sayingthey are moving toward a more stable productportfolio. It is impossible to know whether thisshift is a direct result of the credit crisis, asit could also be a response to the increasedsophistication of wealth accumulation productson offer to retail customers in these bankingmarkets.

Uncertainty about the economic outlook in theWestern world appears to be a major driver

preventing customers from changing theirportfolios: less than a quarter of Europeansare doing so. However, there are some extremedifferences among European countries, withonly 8% of customers in the Netherlandschoosing investment products over savings,while in Belgium, France and Hungary thisgure is in excess of 50% of respondents.

It could be that customers’ desire to haveaccess to their money is responsible for thisreluctance to take it out of savings accounts,while the availability of money in emergingmarkets is driving the opposite move.

Minimizing attrition

• Invest in customer analysis – Capturing andsuccessfully leveraging customer informationand insight to optimize offer development,pricing decisions and rewarding loyalty will bea major competitive differentiator.

• Identiy advocates – Make it easy forcustomers to provide feedback at all touchpoints with the bank. This will allow a betterunderstanding of which customers are likelyto promote, detract or be passive. This willallow banks to more proactively engage thosecustomers at risk of attrition.

• Target switching oers – Maximize theopportunity to acquire new customers andprevent the most damaging impacts ofattrition.

• Review employee key perormanceindicators – Setting and consistentlydelivering clear customer standards thatare demonstrably market-leading will paydividends in terms of customer acquisitionand retention.

World

71%

29%

Europe

76%

24%

Latin America

62%

38%

US

73%

27%

Canada

69%

31%

India

41%

59%

South Africa

53%

47%

Japan

71%

29%

China

60%

40%

Brazil

54%

46%

Move to more secure products and investmentsQ. Have you moved to investment products over savings given the low interest rates? = Yes = No


22



Customers who expressed

a high degree of satisfaction

with their main bank

World

63%

Europe

59%

US

77%

Brazil

68%

India

68%

China

67%

23



Enhancing the customer experience Banks need to reconnect with their customer base byimproving the customer experience. There is a clear demandfor greater personal attention among our respondents, andit is also evident that banks need to invest in channels andbecome more customer-centric across their operations.

There is considerable room for improvement in the levelsof channel efciency, personalization and integration thatbanks offer their customers.

Brazil

India

Latin America

China

JapanCanada

South Africa

World

One or two

13%

Three

24%

Four or five

63%

Degree o satisaction with the main bank

Q. What is your degree of satisfaction with your main bank?

24

Rated on a scale of one to ve, with ve representing the highest degree of satisfaction

One or two Three Four or fve

15% 17% 68%


7% 26% 67%


7% 38% 55%


14% 32% 54%One or two Three Four or fve

10% 22% 68%


9% 18% 73%


7% 16% 77%


9% 23% 68%


13% 24% 63%



Building on satisaction

Despite an ever-increasing array of sophisticateddemands, the good news for banks is that asignicant number of customers around the

globe – 63% – are satised with their main bank.However, this means that more than a third ofglobal customers are not currently satised with

the service they are receiving from their banks.

Customers in the US, Canada, China, India and

Brazil are the most satised – an interesting mixof countries incorporating those that have beenseverely affected by a decrease in trust and those

that have not. It is apparent that customers canremain satised with their individual bankingprovider regardless of the impact the credit crisis

has had on their condence and trust in theindustry at a macro level.

Across Europe, Polish, Hungarian and Dutch

customers are the most satised. The leastsatised with their main bank are customers fromGermany, where 54% give their bank a low score

of just one or two out of ve.

These levels of satisfaction suggest that efforts by

banks to improve customer satisfaction have hadonly limited success and that much more needsto be done to reward loyalty among customers

and to focus on getting to know customers’ needsto ensure that their satisfaction prevails. Banksshould incentivize satised customers to access

more products, and tailor their product offeringsto create further customer advocates. Bankscan also learn from their satised customers’

experience through feedback to gain insights withthe view toward increasing satisfaction acrossthe entire customer base.

Enhancingthe customerexperience

Europe

One or two

15%

Three

26%

Four or five

59%

Belgium

France

Germany

Hungary

Italy

Netherlands

Poland

Scandinavia

Spain

United Kingdom

Degree o satisaction with the main bank

Q. What is your degree of satisfaction with your main bank?

25


54% 24% 22%


12% 34% 54%


10% 28% 62%


12% 18% 70%One or two Three Four or fve

11% 25% 64%


16% 28% 56%


9% 22% 69%


6% 21% 73%


7% 24% 69%


12% 32% 56%


15% 26% 59%



A personalized service

Globally, 43% of customers say they get no, oronly occasional, personal attention from theirmain bank. Our results show that across theglobe, Indian (81%), US (67%) and Canadian(66%) respondents rate the personalizedservice they receive the highest, while only11% of Japanese customers say their receive agood or very personalized service and 45% saythey receive absolutely no attention.

Across Europe, 56% of respondents receivegood or very personalized service withthe highest satisfaction levels evident inBelgium (66%) and Spain (65%). But notall customers believe that they are receivingpersonalized service: the highest levels ofEuropean customers who say they receiveabsolutely no attention or only occasionalcontact are in Italy (55%), Germany (53%)and the UK (53%).

Given the signicance of personal attention

in the bank-customer relationship, banksneed to review how this personalized servicecan be delivered at a competitive cost. While

branch closures have been a feature of matureWestern European banking markets for sometime, our ndings suggest that branchesremain an important part of the future ofbanking, as more customers are satisedwith their branch experiences than any otherchannel. Branches are usually the channelsused by customers for their most complextransactions, so these should be invested inand process simplication, staff training andcustomer knowledge should all be improvedto fully leverage investment in the branchchannel.

Banks also need to combine their knowledgeof the customer base with the technologyavailable to improve their service offerings.Internet technologies can be employed togive a better customer experience online, butwhile internet banking is reducing the needfor call centers, customers are still demandinggreater access and availability to advisors onthe phone, and it is the call center channel thatmost respondents want to see improved in

terms of service quality.

Enhancingthe customerexperience

Personalized attention

Q. How do you value the personalized attentionprovided by your main bank?

11% 33% 42% 14%

Europe

13% 27% 40% 20%

lBrazi India

5% 14% 57% 24%

6% 33% 40% 21% 45% 44% 6% 5%

China Japan South Arica

14% 33% 39% 14%

World

Absolutely

no attention

12%

Occasional

contact

31%

Good

service

41%

16%

6% 27% 48% 19%

5% 27% 45% 22% 7% 27% 44% 22%

Canada

26

personalizedVery

Latin America





We take from these ndings not only aconclusion about the signicance of the branchnetwork for relationships, but also a beliefthat the future success of banks will dependon increasingly personalized services acrossall channels. Whether delivering servicesvia mobile, email, call center or internet,

the nature of the contact is the key. Banksshould consider offering customers the abilityto email named individual advisors directlywith questions, and look at deploying moresophisticated call center services where staffcan provide more personalized attention andtailored advice.

Improving the customer experience• Measure and reduce customer eort –

Simplify branch processes and improveonline capabilities using methods such asdigital banking to help create a consistentand integrated personalized service withoutthe need for extensive manual interventionfor time-poor customers. This, in turn,demonstrates the banks’ visible commitmentto a more responsible banking approach.

• Improve personalization across channels –Make better use of customer information andleverage new technology capabilities such as

Web 2.0 to increase the level of context andpersonalization in customer interactions.

• Create dierentiated customer value

propositions – Increase customer loyalty byoffering individuals a combination of productbundling, pricing and access to value-addedservices to make multiple product holdingsmore attractive and rewarding.

• Invest in traditional and uture distribution

channels – Branch investment should includestaff training and knowledge, while a strongmobile strategy will help meet the need forpersonalized services at a low cost.

3%

11%

39%

20%

25%

40%

25%

2%

19%

27%

28%

15%

27%

20%

4%

9%

31%

25%

22%

46%

14%

4%

16%

22%

21%

21%

33%

8%

8%

14%

15%

14%

18%

33%

16%

7%

9%

11%

11%

16%

21%

17%

4%

18%

43%

23%

11%

23%

22%

3%

24%

24%

33%

19%

28%

16%

Ways o improvement

Q. For each banking channel, what are the main areas in which you would like to see improvements?

= Personalization

= Service quality

= Price

= Ease of use

= Access andavailability

= Security

= Other

28

Call center

Branches

World

ATMs Internet Mobile banking

Email Mail Other



Hearing the customer’s voice

Banks have recognized that there are some

customers who want the touch and feel of branch-based banking relationships, and there are otherswho demand efcient, faster direct services,

whether those are delivered over the internet oron a mobile phone. While it is clearly different

across markets, generally providers are investing

in opening new branches, staying open laterand increasing stafng, while at the same timedeveloping new technologies to serve customers

more efciently. There is a recognition that banksneed to identify exactly who their customers are,segment that population, understand what those

customers want, and then provide it.

The competitive landscapeIt is clear from our research that enhancing individualcustomer relationships is critically important to futurecompetitive success. In the wake of the credit crisis,retail banks need to continually review their strategies,business models and routes to market to ensure that

they are responding to customer expectations. Acrossthe local retail banking markets, regardless of thediffering challenges, banks will need to adopt an agileapproach to meet the pace of change.

The most critical actors to being competitive over the next two years

% most critical

= High performers

= Low performers

= All respondents69% 43% 51% 55% 48% 52% 55% 43% 52% 39% 57% 48% 28% 36% 32% 26% 41% 27% 14% 18% 19%

Product and

(or) service

innovation

Brand and

reputation

Becoming more

organizationally

agile to respond

aster to market

change

Becoming more

cost-

competitive

in sales,

distribution

and service

Increasing

stakeholder

confdence to

retain access to

capital at a low

and competitive

cost

Becoming more

cost-

competitive

in production

Geographic

reach

29

Source: Ernst & Young – Competing for growth



We are seeing innovations in channels worldwide,

with mobile banking initiatives proving successfulin emerging markets, and banks are continuingthe development of applications to help customers

manage their money more intelligently on theirmobile phones. We are also seeing the increasingintegration of channels, so that customers who

begin transactions online can seamlessly switchto speaking to call center staff midway throughthe process if they want a more personalized

interaction.

As well as adopting multichannel strategies, many

banks are also investing in loyalty programs toreward delity, with offerings such as discountedmortgage rates for customers who already hold

current accounts with them. We are also seeingmany banks investing in complaint handlingprocedures with a view to responding quickly,

addressing issues, and capitalizing on intelligencegained in the process.

Banks have recognized that customers want to bein control and bank when and where it suits them,

so future success will come through combiningcustomer knowledge with technology to makebanking easier and more accessible. Such anapproach relies on customer analytics, and banks

are also investing in more precise measurementof customer satisfaction, the number of productsthey hold, the reasons for attrition and complaints.

Investing in service

Even though we have seen consolidation acrossmany local markets, customers still have a

choice of provider, and service quality is akey differentiator between banks. The adventof customer charters that promise to make

banking simpler and commit to minimum servicestandards, and a move away from a product-pushapproach toward a customer-centric attitude, will

gather pace.

In a recent Ernst & Young report titled Competing

or Growth, high-performing bank respondentsidentied product and service innovation as themost critical factor to competitive advantage

over the next two years, closely followed by brandand reputation. They told us they are introducingnew products and services and increasing their

focus on marketing, and said that innovation wasbecoming increasingly important for survival in themarket.

We see a clear message emerging that customer-

focused innovation will drive success in retailbanking in the years ahead. Banks cannot takethe customer relationship for granted but mustidentify and respond proactively and innovatively

to their customers’ needs.

Leading banks’ perormance dierentiatorsThere are many examples of ways in whichthe leading performers are responding to thechanging environment. Banks across the globeare:

• Reinorcing their brands and reputation –by investing in the customer experience

• Reocusing on their segment – by increasingthe focus on marketing and developing newdistribution channels

• Tailoring their product range – bysimplifying products and developing products

that are more aligned with customer needs

• Focusing on key markets – by executinginnovative market entry strategies andfocusing on their regional strengths

Banks need to be mindful of this competitiveenvironment as they strive to differentiatetheir offering while carefully managingreputational risk.

30



ConclusionsCustomer behavior in retail banking has changeddramatically over the past few years. This survey hastouched on some of the key changes in customerexpectations, and the ways in which these changingdemands can be met by banks that offer customer–

focused innovative services. Those that do so will be ableto differentiate their organization and drive growth.

Our research has reinforced that there are fewglobal trends in retail banking, as customerperceptions are driven by a range of things,including many cultural differences, varyinglevels of overall market maturity and signicant

differentials in the impact of the credit crisis ondifferent markets.

Customer strategies will need to becarefully tailored to different markets andthe developing needs of customers in eachdiscrete market. Banks that can adopt an agileapproach and react to rapidly shifting customerdemands within the markets they operate inand the markets they wish to enter will emergeas stronger institutions.

The keys to success will be brand management,

personalized services and efcient pricing.Those that can deliver on all three will prosperin a highly regulated and constantly changingglobal nancial services market.

We suggest that banks embrace thefollowing action points tocapitalize on these opportunities:

• Rebuild trust – by refocusing on thecustomer relationship, paying particularattention to clarity of language,transparency of pricing and simplicity ofinteraction

• Focus on loyalty – by building customerinsights, tailoring offerings, incentivizingcustomers to access more products andeffectively responding to complaints

• Enhance the customer experience – byinvesting in branches, delivering personalattention across channels and combiningcustomer insights with technology toimprove offerings

31



Customerswho eel theyget little or nopersonalizedattention romtheir main bank

World

43%

Europe

44%

US

32%

Brazil

40%

India

19%

China

39%

32



To capture and satisfy customers, nancialservices organizations need to commit fullyto being customer-focused organizations.Expanding into new markets, developingnew propositions to enable a differentiatedcustomer offering and maximizingcustomer protability all require a thoroughunderstanding of customer needs.

Ernst & Young’s integrated nancial services

team works without boundaries betweenpeople, disciplines and geographies. We candeliver solutions and opinions to help you workto address:

Customer and market strategy

• Creating differentiated customer valuepropositions

• Transforming operating models to be morecustomer-focused and lower-cost

• Optimizing and aligning distribution to bettermeet customer needs

Customer analytics and economics

• Identifying untapped customer needs andvalue creation opportunities

• Improving cross-selling effectiveness

• Diagnosing and resolving customer retentionissues

Sales and channel management

• Improving customer experiences acrosschannels

• Increasing the efciency and effectiveness ofcontact centers

• Reducing sales and service performancevariation across channels

Customer service management

• Helping to create and manage customersystems transformations to deliver improvedcustomer experiences

• Improving internet security to build customertrust

• Leveraging Web 2.0 to innovate aroundcustomer experiences

How Ernst & Young can helpA clearly articulated customer strategy should be atthe core of all banking organizations. Enhancing thecustomer experience is now a crucial component ofattracting and retaining customers in order to growand protect a protable business.

33



1%

6%

18%

23%

40%

7%

16%

7%

38%

8%

3%

2%

4%

8%

15%

23%

24%18–24 years old

25–34 years old

35–54 years old

55–64 years old

65–74 years old

75 years or older

Employee

Executive

Inactive

Intermediate

professional

Retired

Student

Tradesman

No response

< €18,000

€18,000 – €36,000

€36,000 – €54,000

€54,000 – €72,000

€72,000 – €90,000

€90,000 – €120,000

> €120,000

Methodology

This research was conducted using an internetquestionnaire in November and December2010. A total of 20,556 participants weresurveyed, including 10,021 Europeans; 4,018Latin Americans; 2,001 US residents; 1,008Japanese; 1,003 Canadians; 1,002 Chinese;1,000 Indians; and 503 South Africans.

Participants’ gender, place of residence, age,occupation and income are detailed below.

34

Gender Population (place of residence)

Age Occupation Income

<2,000 2,000 to 100,000 >100,000

12% 36% 52%Female Male

49% 51%

21%

12%

12%

12%



35



20,500 banking customersacross 23 mature andemerging markets.

36



1. Trust and satisaction

Finding: In Belgium, customer condence inthe banking industry has been, unsurprisingly,negatively affected by the credit crisis, butcustomers’ satisfaction with their main bankremains high.

Statistic: 51% say that their trust in banks hasfallen in the past 12 months, but 62% scoretheir bank four or ve out of ve when askedabout their degree of satisfaction.

2. Main bank relationship

Finding: The majority of Belgian customersbank with one bank.

Statistic: 42% of Belgian customers bank withone bank, and four out of ve customers bankwith fewer than three banks.

3. Product holdings

Finding: Belgian customers’ delity to theirmain bank has grown in the past year.

Statistic: 8% of customers hold only oneproduct with their main bank, compared with13% last year, and the number of customersholding 2–4 products has grown from 55% to73% in the past 12 months.

4. Reasons or attrition

Finding: Belgian customers have left their mainbanks due to service quality.

Statistic: 39% of Belgian customers that havechanged their main bank cite service quality,and a further 16% cite a specic service failing

for their switch.

5. Personalized service

Finding: Belgian customers are the mostsatised customers in Europe in relation to thelevel of personalized attention they receivefrom their main bank, and are not willing to payextra for independent nancial advice.

Statistic: 66% consider the level ofpersonalized attention their bank offers to beeither good or excellent, which was the highestscore in Europe, compared with a European

average of 56%. Only 3% are willing to payfor independent advice for all investments,and a further 13% will pay for it for high-endinvestments. The rest believe it should be partof the regular service they receive.

6. Channel experience

Finding: While Belgian customers indicate thatthey are generally satised with branch, ATMand internet channels, they are much lesssatised with call centers and mobile bankingchannels.

Statistic: 88% are satised with internetbanking, but only 36% are satised with callcenter offerings.

Key Belgian fndings

3%Only 3% are willing to pay or

independent advice or all

investments

At a glance

Regional contact

Philippe Desombere

Tel: +32 2 774 9553Email: [email protected]

37




Finding: In Canada, trust in banks hasremained largely unchanged in the past year.Canadian customers ranked a joint secondas the most satised customers out of all thecountries we surveyed.

Statistic: 63% say their trust in banks has notchanged in the past 12 months. 73% scoretheir bank four or ve out of ve when askedabout their degree of satisfaction.


Finding: Canadian customers tend to bank withone or two banks.

Statistic: 48% of Canadian customers bankwith just one bank, and 37% bank with twobanks.

3. Product holdings

Finding: Canadian customers tend to have ahigh delity to their main bank.

Statistic: The average customer holds 3.1products with the main bank, comparedwith a global average of 2.9. The number ofcustomers holding one product with the mainbank is just 10%, and 74% hold 2-4 products.


Finding: Canadian customers cite poor servicequality as the main reason for leaving theirmain bank.

Statistic: 38% of customers who decided tochange their main bank did so because of

general levels of service quality, while 26%cited specic service failing for their switch.


Finding: The majority of Canadian customersare very satised with the level of personalizedattention they receive from their bank, and areunwilling to pay extra for independent nancialadvice.

Statistic: 66% consider the level ofpersonalized attention their bank offers tobe good or very good. 73% would not pay for

independent nancial advice, but 20% woulddo so for high-end investments.


Finding: Customers in Canada are verysatised with branches, internet banking andATMs, and are much less satised with mobilebanking.

Statistic: 85% are satised with the branchexperience, 88% are satised with ATMs and84% are satised with internet banking. Only29% are satised with mobile banking.

Key Canadian fndings

85%85% are satisfed with the branch

experience

At a glance

Regional contact

Paul Battista

Tel +1 416 943 3820Email: [email protected]

38



Key Chinese fndings

96%96% bank with more than

one bank


Finding: In China, the global credit crisis hashad a largely neutral impact on customercondence in the banking industry. Customersin China are also largely satised with theservice they get from their banks.

Statistic: 47% say their trust in banks has notchanged in the past 12 months, while 23% saytheir condence has increased. 67% score theirbank four or ve out of ve when asked abouttheir degree of satisfaction.


Finding: Chinese customers tend to bank withmultiple providers.

Statistic: 96% of Chinese customers bank withmore than one bank, and 73% bank with threeor more providers.

3. Product holdings

Finding: Chinese customers are on par withthe global average in terms of the number ofproducts they hold with their main bank.

Statistic: The average Chinese customer holds2.9 products with the main bank, in line withthe global average. The number of customersholding one product with the main bank is 17%,and 14% hold ve or more.


Finding: Chinese customers who have changedtheir main bank state poor service quality asthe key factor.

Statistic: 55% of customers who decided tochange their main bank did so because of

general levels of service quality; 36% statedproduct and service offerings as their reason,and 25% cited a specic service failing for theirswitch.


Finding: Customers in China are very satisedwith the level of personalized attention theyreceive from their bank, and more than half arewilling to pay extra for independent nancialadvice.

Statistic: 61% say that the level of

personalized attention they receive is eithergood or very good. 49% would pay forindependent nancial advice for high-endinvestments, and a further 11% would pay foradvice on all of their investments.


Finding: Customers in China are very satisedwith branches, internet banking and ATMs, andare less satised with mobile banking. Theyare satised with the services provided by callcenters.

Statistic: 81% are satised with the branchexperience, 87% are satised with ATMs and85% are satised with internet banking. 54%are satised with mobile banking and 66% withcall centers.

At a glance

39

Regional contact

Jack Chan

Tel: +852 2629 3508Email: [email protected]



Key French fndings

84%84% would not pay or independent

fnancial advice, believing it should be

part o the service their bank oers


Finding: In France, customer condence inthe banking industry has decreased in thepast 12 months, even though the majority ofcustomers are satised with their own mainbank.

Statistic: 54% say that their trust in bankshas fallen in the past 12 months, but thesame proportion scores their bank four or veout of ve when asked about their degree ofsatisfaction.


Finding: While trust in banks has beennegatively affected, the level of delity to acustomer’s main bank has endured.

Statistic: 50% of French respondents bankwith only one bank, and just 4% bank with more

than three providers.

3. Product holdings

Finding: French customers’ delity to theirmain bank is higher than the Europeanaverage.

Statistic: 17% of French customers hold veor more products with their main bank,compared with 40% a year ago. The numberholding between 2-4 products has grown from49% to 75%.


Finding: Service quality is the leading factor forattrition.

Statistic: 40% of French customers who optedto change their main bank did so becauseof general service quality issues, 37% cited

nancial advisor competency, 28% citedproduct and service offerings and 27% citedprice.


Finding: The majority of French customers aresatised with the level of personal attentionthey receive from their bank and would not payfor independent nancial advice.

Statistic: 59% rate the level of personalizedattention they receive as either good or verygood. 84% would not pay for independent

nancial advice, believing it should be part ofthe service their bank offers.


Finding: While French customers are generallysatised with branch, ATM and internetchannels, they are much less satised with callcenters and mobile banking channels.

Statistic: 88% are satised with ATMs and 82%with internet and branch services, but only 28%are satised with mobile banking offerings.

At a glance

40

Regional contact

Pierre Pilorge

Tel: +33 1 46 93 59 79Email: [email protected]



Key German fndings

53%53% say they receive absolutely

no attention rom their bank or

only occasional contact


Finding: Consumer condence in Germany hasdecreased considerably in the past year, andthe majority of German customers are alsodissatised with their main bank.

Statistic: 61% say that their trust in banks

has fallen in the past 12 months, and 66% ofcustomers said this was due to lack of trust intheir bank’s ability to protect their assets anddata. 54% of German customers score theirbank just one or two out of ve when askedabout their degree of satisfaction.


Finding: German customers tend to bank withone or two banks.

Statistic: 41% of German customers bankwith one bank, and nearly four out of ve

customers bank with fewer than three banks.

3. Product holdings

Finding: German customers’ delity to theirmain bank has fallen.

Statistic: 23% of customers hold one productwith their main bank, the same as last year, butthe number holding ve or more products hasdropped from 19% to 9% in the past year.


Finding: German customers who left their mainbanks moved due to price and levels of servicequality.

Statistic: Price was given as a reason by 58%of respondents, while 45% cited service quality

as a factor.


Finding: The majority of German customersare dissatised with the level of personalizedattention they receive from their bank, andbelieve that independent nancial adviceshould be part of the service.

Statistic: 53% say they receive absolutely noattention from their bank or only occasionalcontact. Four out of ve would not be willing topay for independent nancial advice.


Finding: While German customers indicate thatthey are generally satised with branch andinternet channels, they are much less satisedwith ATMs, call centers and mobile bankingchannels.

Statistic: 80% are satised with internetbanking, but only 22% are satised with ATMsand 36% are satised with call centers.

At a glance

41

Regional contact

Robert Melnyk




Key Hungarian fndings

72%72% o customers who decided to

leave their main bank cited price

as a actor


Finding: In Hungary, customer condencein the banking industry has been negativelyaffected by the credit crisis, but customersatisfaction remains high.

Statistic: 54% say that their trust in banks has

fallen in the past 12 months, but 70% scoretheir bank four or ve out of ve when askedabout their degree of satisfaction.


Finding: Hungarian customers tend to bankwith one bank.

Statistic: 44% of Hungarian customers bankwith one bank, and more than four out of vecustomers bank with fewer than three banks.

3. Product holdingsFinding: Hungarian customers have lower-than-average delity to their main bank,compared with the European average.

Statistic: Customers hold an average of 2.4products with their bank, compared with aEuropean average of 2.9.


Finding: Price and dissatisfaction with servicequality have been the largest drivers ofattrition for Hungarian customers.

Statistic: 72% of customers who decided toleave their main bank cited price as a factor.

45% cited service quality.


Finding: Hungarian customers are generallysatised with the level of personalizedattention they receive from their bank,but very few are willing to pay extra forindependent nancial advice.

Statistic: 59% consider the level ofpersonalized attention their bank offers to beeither good or excellent. Only 4% are willing topay for independent advice for all investments,

while a further 22% will pay for it for high-endinvestments. The rest believe it should be partof the regular service they receive.


Finding: While Hungarian customers indicatethat they are generally satised with branch,ATM and internet channels, they are lesssatised with call centers, email and mobilebanking channels.

Statistic: 81% are satised with branches andinternet banking, and 53% are satised with

mobile banking.

At a glance

42

Regional contact

Istvan Nagy




Key Indian fndings


Finding: In India, the credit crisis has hadminimal impact on customer condence in thebanking industry, and customers’ condence inthe industry appears to have grown in the past12 months. The majority of customers are alsovery satised with the service they get fromtheir banks.

Statistic: 75% say their trust in banks hasincreased in the past 12 months, and 17% saytheir condence has not changed. 68% scoretheir bank four or ve out of ve when askedabout their degree of satisfaction.


Finding: Indian customers tend to bank withmultiple providers.

Statistic: 88% of Indian customers bank with

more than one bank, and 42% bank with threeor more providers.

3. Product holdings

Finding: Indian customers tend to hold a highnumber of products with their main bank.

Statistic: The average customer holds 3.1products with the main bank, compared with aglobal average of 2.9. 15% of customers holdone product with the main bank, and 20% holdve or more.


Finding: Despite generally high levels ofsatisfaction with banks, Indian customers aregenerally leaving their main bank because ofpoor service.

Statistic: 50% of customers who decided to

leave their main bank did so because of generallevels of service quality, while 38% citedproduct and service offerings.


Finding: Out of all the countries we surveyed,Indian customers are the most satised withthe level of personalized attention they receivefrom their main bank, and the majority arewilling to pay extra for independent nancialadvice.

Statistic: 81% consider the level of

personalized attention their bank offers tobe good or very good. 45% would not pay forindependent nancial advice, but 43% woulddo so for high-end investments, and a further12% would pay for independent advice on alltheir investments.


Finding: Customers in India are very satisedwith branches, internet banking and ATMs,and are more satised than most with mobilebanking.

Statistic: 84% are satised with the branchexperience, 81% are satised with ATMs and79% are satised with internet banking. 59%are satised with mobile banking – the highestpercentage in our survey.

At a glance

75%75% say their trust in banks has

increased in the past 12 months

43

Regional contact

Manek Fitter




Key Italian fndings

62%62% bank with one bank, and

more than 90% o customers

bank with ewer than three banks


Finding: In Italy, customers’ condence in thebanking industry has been negatively affectedby the credit crisis, but customer satisfactionwith their main bank remains high.


fallen in the past 12 months, but 56% scoretheir bank four or ve out of ve when askedabout their degree of satisfaction.


Finding: The majority of Italian customers bankwith one bank.

Statistic: 62% of Italian customers bank withone bank, and more than 90% of customersbank with fewer than three banks.

3. Product holdingsFinding: Italian customers are generallyholding more products with their main bank.

Statistic: 15% of customers hold only oneproduct with their main bank, compared with25% last year. However, the percentage holdingve or more products has fallen from 34% to10% in the past 12 months.


Finding: The majority of Italian customers citedprice as the main reason they left their mainbank.

Statistic: 52% of Italian customers whochanged main banks cited price as a factor.

37% moved due to service quality, while 10%cited a specic service failing for their switch.


Finding: Italian customers are the mostdissatised with the personal attention theyreceive from their main bank across Europe,with almost a fth of Italian customersreceiving no attention from their mainbank. They are not willing to pay extra forindependent nancial advice.

Statistic: 19% of customers receive no

attention and a further 36% said they receiveoccasional attention from their main bank. 70%say they would not pay for independent advice,believing it should be part of the service theirbank offers.


Finding: While Italian customers indicate thatthey are generally satised with branch, ATMand internet channels, they are less satisedwith call centers and mobile banking channels.

Statistic: 86% are satised with ATMs, 76%

with the branch and 81% with internet banking,but only 48% are satised with call centers and54% with mobile banking.

At a glance

44

Regional contact

Fabio Gasperini




Key Japanese fndings


Finding: In Japan, the credit crisis has had alargely neutral impact on customer condencein the banking industry. Nevertheless, a largeproportion of customers are not satised withthe service they get from their banks.

Statistic: 65% say their trust in banks has notchanged in the past 12 months, while 32% saytheir condence has fallen. But 45% score theirbank three or less out of ve when asked abouttheir degree of satisfaction.


Finding: Japanese customers are likely to bankwith multiple providers.

Statistic: 93% of Japanese customers bankwith more than one bank, and 68% bank withthree or more providers.

3. Product holdings

Finding: Japan’s bank customers have lowdelity to their main bank.

Statistic: The average customer holds 2.1products with the main bank, comparedwith a global average of 2.9. The number ofcustomers holding one product with the mainbank is 34%, and only 5% hold ve or more.


Finding: With generally low levels ofsatisfaction with banks, Japanese customersstate poor service and the proximity ofbranches as their main reasons for leavingtheir main bank.

Statistic: 36% of customers who decidedto change their main bank cited the lack ofproximity of branches. 23% blamed generallevels of service quality.


Finding: Japanese customers receive thelowest level of personalized attention out of allthe countries we surveyed.

Statistic: 45% say that they receive absolutelyno personalized attention from their bank, anda further 44% get only occasional contact. 70%

would not pay for independent nancial advice,but 27% would do so for high-end investments.


Finding: Customers in Japan are very satisedwith branches, internet banking and ATMs, andare less satised with mobile banking and callcenters.

Statistic: 78% are satised with the branchexperience, 80% are satised with ATMs and67% are satised with internet banking. 40%are satised with mobile banking and 35% with

call centers.

At a glance

93%93% bank with more than one bank

45

Regional contact

Tad Matsushige




Key Latin American fndings

47%47% o customers who decided

to change their main bank did

so because o general levels o

service quality


Finding: In Latin America, the impact of thecredit crisis on customer condence in thebanking industry has been largely neutral. Themajority of customers are largely satised withtheir main bank.

Statistic: 42% say their trust in banks has notchanged in the past 12 months, and 27% saytheir trust has increased. 68% score their bankfour or ve out of ve when asked about theirdegree of satisfaction.


Finding: Two-thirds of Latin Americancustomers bank with more than one bank.

Statistic: 66% of Latin American customersbank with two or three banks, and 34% bankwith just one.

3. Product holdings

Finding: Latin American customers have ahigher than average delity to their mainbanks.

Statistic: The average customer holds 3.0products with the main bank, comparedwith a global average of 2.9. The number ofcustomers holding one product with the mainbank is 17%, and two-thirds hold between twoand four.


Finding: Service quality is the most commonreason for Latin American customers to haveleft their bank.

Statistic: 47% of customers who decided tochange their main bank cited general levels of

service quality, 39% cited product and serviceofferings, and 35% cited price.


Finding: Latin American customersare generally satised with the level ofpersonalized attention they receive from theirbank, and are perhaps more willing to payextra for independent nancial advice.

Statistic: 67% consider the level ofpersonalized attention their bank offers tobe good or very good. 58% would not pay for

independent nancial advice, but 34% woulddo so for high-end investments.


Finding: Customers in Latin America are verysatised with internet banking and ATMs, andrate other channels much higher than theircounterparts around the world.

Statistic: 79% are satised with ATMs and 77%are satised with internet banking, but only66% are satised with the branch experience.54% are satised with mobile banking and 59%

with call center offerings.

At a glance

46

Regional contact

Paul Gruppo




95%95% are satisfed with internet

banking


Finding: In the Netherlands, it is no surprisethat customer condence in the bankingindustry has been negatively affected by thecredit crisis, but customers’ satisfaction withtheir own main bank remains high.

Statistic: 51% say that their trust in banks hasfallen in the past 12 months, but 69% scoretheir bank four or ve out of ve when askedabout their degree of satisfaction.


Finding: Dutch customers tend to bank with nomore than three banks.

Statistic: 46% of Dutch customers bank withone bank, and 39% bank with two banks.

3. Product holdingsFinding: Dutch customers have increased thenumber of products held with their main bankin the past year.

Statistic: 16% of customers hold only oneproduct with their main bank, compared with15% last year. The percentage holding between2-4 products has grown from 66% to 76% inthe past 12 months.


Finding: Quality of service is the main reasonfor Dutch customers leaving their main bank.

Statistic: 33% of Dutch customers who havechanged their main bank cite service quality,while 25% cited specic service failing.


Finding: Over a fth of Dutch customersreceive no attention from their main bank,which was the highest score in Europe,and they are not willing to pay extra forindependent nancial advice.

Statistic: 21% of Dutch customers said theyreceive no attention from their main bank,and a further 29% said they receive occasionalcontact. 91% say they would not pay forindependent advice, believing it should be part

of the service their bank offers.


Finding: Dutch customers indicate that theyare very satised with internet banking, butthey are less satised with branches thancustomers across Europe, and are unsatisedwith call centres and mobile banking channels.

Statistic: 95% are satised with internetbanking and 72% are satised with branches,but only 45% are satised with call centerofferings and 48% with mobile banking.

Key Dutch fndingsAt a glance

47

Regional contact

Andrew Barstow




Key Polish fndings

59%59% say that their trust in banks

has not changed in the past 12

months


Finding: In Poland, customer condence in thebanking industry has been largely unaffectedby the credit crisis, and customers’ satisfactionwith their main bank is the highest in Europe.

Statistic: 59% say that their trust in banks

has not changed in the past 12 months, and73% score their bank four or ve out of vewhen asked about their degree of satisfaction,which was ranked a joint second out of all thecountries we surveyed.


Finding: The majority of Polish customers bankwith one or two banks.

Statistic: 47% of Polish customers bank withone bank, and more than 80% of customersbank with fewer than three banks.

3. Product holdings

Finding: Polish customers have a slightly lower-than-average level of delity to their mainbank when compared with customers in otherEuropean countries.

Statistic: The average customer holds 2.6products with his or her main bank, comparedto a European average of 2.9 products.


Finding: Attrition has been drivenpredominantly by price, followed by servicequality.

Statistic: 60% of customers who decided tochange their main bank cited price; 48% cited

service quality and 43% cited product andservice offerings.


Finding: The majority of Polish customersare satised with the level of personalizedattention they receive from their bank, butalmost a third of customers are willing to payextra for independent nancial advice for high-end investments.

Statistic: 60% consider the level ofpersonalized attention their bank offers to

be good or very good. 68% would not pay forindependent nancial advice, but 30% woulddo so for high-end investments, which was thehighest score across all of Europe.


Finding: Polish customers indicate that theyare very satised with internet banking,branches and ATMs, but they are less satisedwith call centers and mobile banking channels.

Statistic: 89% are satised with internetbanking, 82% are satised with ATMs and 80%

are satised with branches, but only 50% aresatised with call center offerings and 53%with mobile banking.

At a glance

48

Regional contact

Piotr Frankowski




Key Scandinavian fndings

74%74% would not pay or

independent fnancial advice


Finding: In Scandinavia, customer condencein the banking industry has been largelyunaffected by the credit crisis, and customersatisfaction with banks remains high.


not changed in the past 12 months, and 69%score their bank four or ve out of ve whenasked about their degree of satisfaction.


Finding: Scandinavian customers tend to bankwith one or two banks.

Statistic: 43% of Scandinavian customersbank with one bank, and more than 80% ofcustomers bank with fewer than three banks.

3. Product holdingsFinding: Scandinavian customers have ahigher-than-average level of delity to theirmain bank than customers elsewhere inEurope.

Statistic: The average customer holds 3.4products with his or her main bank, comparedwith a European average of 2.9 products.


Finding: Price is the most common reason forattrition, followed by service quality.

Statistic: 44% of customers who decided tochange their main bank cited price, 35% citedservice quality, and 28% cited product and

service offerings.


Finding: Scandinavian customers are satisedwith the level of personalized attention theyreceive from their bank, and most are notwilling to pay extra for independent nancialadvice.

Statistic: 61% consider the level ofpersonalized attention their bank offers tobe good or very good. 74% would not pay forindependent nancial advice, but 23% would

do so for high-end investments.


Finding: Scandinavian customers indicate thatthey are very satised with internet banking,and also rate branches and ATMs highly. Theyare less satised with call centers and mobilebanking channels.

Statistic: 93% are satised with internetbanking, and 74% are satised with branchesand ATMs. 51% are satised with call centerofferings and mobile banking.

At a glance

49

Regional contact

Fredrik Andrén

Tel: +46 8520 5 9112Email: fredrik.andré[email protected]



Key South Arican fndings

44%44% bank with only one bank


Finding: In South Africa, the credit crisis hashad a negative impact on customer condencein the banking industry. Almost half of thecustomers in South Africa are not satisedwith the service they get from their banks.

Statistic: 47% say their trust in banks hasfallen in the past 12 months, while 31% saytheir condence has not changed. 46% scoretheir bank three or less out of ve when askedabout their degree of satisfaction.


Finding: South African customers tend to bankwith no more than two banks.

Statistic: 44% of South African customersbank with one bank, and only 13% bank withthree or more providers.

3. Product holdings

Finding: South African customers’ delityto their main bank is higher than the globalaverage.

Statistic: The average customer holds 3.1products with the main bank, compared withthe global average of 2.9. The number ofcustomers holding one product with the mainbank is 11%, and 74% hold 2–4 products.


Finding: Poor service quality and price arethe main factors for South African customersleaving their main bank.

Statistic: 59% of customers who decided tochange their main bank cited general levels of

service quality, while 57% cited price.


Finding: The majority of customers inSouth Africa are satised with the level ofpersonalized attention they receive fromtheir bank and are not willing to pay extra forindependent nancial advice.

Statistic: 53% say that the level ofpersonalized attention they receive is eithergood or very good. 64% would not pay forindependent nancial advice, but 26% would



Finding: Customers in South Africa are verysatised with internet banking, branches andATMs, and are more satised than most withmobile banking. They are satised with theservices provided by call centers.

Statistic: 87% are satised with Internetbanking, 83% are satised with ATMs and 82%are satised with branch banking. 52% aresatised with mobile banking and 62% with call

centers.

At a glance

50

Regional contact

Colin Daley

Tel: +27 11 77 2 3396Email: [email protected]



Key Spanish fndings:

65%65% consider the level o

personalized attention their bank

oers to be good or very good


Finding: In Spain, customer condence in thebanking industry has fallen since the creditcrisis, but customer satisfaction with banksremains high.


fallen in the past 12 months, and 56% scoretheir bank four or ve out of ve when askedabout their degree of satisfaction.


Finding: Spanish customers have a highertendency to bank with two or more banks.

Statistic: 32% of Spanish customers bank withone bank, and 23% bank with three or moreproviders.

3. Product holdingsFinding: Spanish customers have the highestdelity rate to their main bank across all ofEurope.

Statistic: The average Spanish customer holds3.7 products with the main bank, comparedwith a European average of 2.9. The numberof customers holding 2–4 products with theirmain bank has increased from 42% in 2009to 61% in 2010, whereas the number ofcustomers holding one product with their mainbank in Spain has fallen from 14% to 7% in thepast year.


Finding: Product and service offerings are themain factor for customers leaving their mainbank, followed by service quality and price.

Statistic: 45% moved due to the product andservice offerings, 42% cited general levels of

service quality, and 28% cited a specic servicefailing as a factor.


Finding: Spanish customers are satised withthe level of personalized attention they receivefrom their bank, and most are not willing topay extra for independent nancial advice.




Finding: Spanish customers indicate that theyare very satised with internet banking andATMs, but are less satised with branches, callcenters and mobile banking channels.

Statistic: 84% are satised with ATMs and 83%are satised with internet banking, but only56% are satised with the branch experience.57% are satised with call center offerings and52% with mobile banking.

At a glance

51

Regional contact

Alberto Placencia




Key UK fndings

63%63% say that their trust in banks

has allen in the past 12 months


Finding: In the UK, customer condence in thebanking industry has been the most negativelyaffected out of all the countries we surveyed.

Statistic: 63% say that their trust in bankshas fallen in the past 12 months, and 36% of

UK customers are dissatised with their mainbank.


Finding: While trust in banks has beennegatively affected, the level of loyalty to acustomer’s main bank has endured.

Statistic: 50% of UK customers bank with onebank, and 84% bank with no more than twobanks.

3. Product holdingsFinding: The number of products held with themain bank has increased in the past year.

Statistic: 96% of UK respondents now holdup to four products with their main provider,compared with 89% last year.


Finding: Attrition has been driven by servicequality issues for UK customers; however, UKcustomers are the least price-sensitive acrossEurope.

Statistic: 42% of UK customers who have

changed their main bank cite service quality,and 27% cite a specic service failing. Only 15%left due to price, compared with the Europeanaverage of 44%.


Finding: The majority of UK customers aredissatised with the personalized attentionthey receive from their main bank, and are notwilling to pay extra for independent nancialadvice.

Statistic: 53% of UK customers report that

they receive no or only occasional contact fromtheir main bank. 77% are not willing to pay forindependent advice and believe it should bepart of the regular service they receive.


Finding: While UK customers indicate that theyare generally satised with branch, ATM andinternet channels, they are much less satisedwith call centers and mobile banking channels.

Statistic: 82% are satised with internetbanking, 80% with branch banking, but only

29% are satised with mobile banking and 49%with call center banking.

At a glance

52

Regional contact

Mark Dynes




55%55% say their trust in banks has

decreased in the past 12 months


Finding: In the US, customer condence in thebanking industry has fallen considerably in thepast 12 months, but surprisingly, out of all thecountries we surveyed, US customers were themost satised with the service they receivefrom their main bank.

Statistic: 55% say their trust in banks hasdecreased in the past 12 months. 77% scoretheir bank four or ve out of ve when askedabout their degree of satisfaction – the highestgure in our survey.


Finding: More than half of US customers bankwith a single provider.

Statistic: 51% of US customers bank with justone bank, and only 16% bank with three or

more banks.

3. Product holdings

Finding: US customers tend to have lower-than-average delity to their main bank thancustomers globally.

Statistic: The average customer holds 2.4products with the main bank, comparedwith a global average of 2.9. The number ofcustomers holding one product with the mainbank is 23%, and only 7% hold ve or more.


Finding: Poor service quality is the key factorfor US customers leaving their main bank.

Statistic: 31% of customers who decidedto move their main bank did so because ofgeneral levels of service quality, while 23%

cited product and service offerings.


Finding: The majority of US customers arevery satised with the level of personalizedattention they receive from their bank, and areunwilling to pay extra for independent nancialadvice.




Finding: Customers in the US are very satisedwith branches, internet banking and ATMs, andare much less satised with mobile banking.

Statistic: 86% are satised with the branchexperience and 83% are satised with internetbanking. Only 34% are satised with mobilebanking, but 60% are satised with call centers.

Key US fndingsAt a glance

53

Regional contact

Clayton Baker




D e s i g n : w w w . h o m e – a s s o c i a t e s . c o m



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Documents

A New Era of Customer Expectation_global Consumer Banking Survey