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Consumers demand more personalised experience from bank
Consumers are increasingly demanding greater recognition and personalised experiences from their bank, according to a new study by Collinson Group .
The findings of the loyalty scheme provider’s international survey revealed changing attitudes and expectations among consumers in respect of their bank, with 64 per cent expecting more in return for their loyalty, and more personalised communications and services, while 83 per cent of UK consumers felt their bank did not know or understand them.
The study gauged the opinions of affluent middle class consumers (those within the top 10 to 15 per cent income bracket) in the UK, US, Italy, Brazil, China, India, Singapore and the United Arab Emirates. Over 50 per cent of UK respondents expressed dissatisfaction with their bank, and are considering switching provider (or have already in the last two years). Only half trust their bank to act in their best interests. Results from the UK current account switching report in July showed 1.1 million customers switched their bank accounts, a four per cent increase on the same period last year.
Less than a third of affluent middle class consumers in the UK are currently members of bank loyalty initiatives, and this group are more likely to be members of a supermarket, airline, credit card and/or retailer loyalty programme rather than a bank’s.
Many consumers feel current account offers are too similar. UK consumers who feel loyal to a brand are 73 per cent more likely to purchase a product from them in the future, and 61 per cent would be prepared to recommend a banking brand to their friends and family.
The findings also suggest banks are losing their position as a ‘one-stop shop’ for financial services, with savvy consumers instead choosing a range of financial service providers. Customers increasingly look elsewhere for additional services, regularly comparing providers of products such as insurance, finding the best deal and purchasing direct.
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Personalised and consistent communications, rewards and service regardless of how customers choose to interact with a bank are also important for consumers. The study suggests customer engagement improves by a third among individuals who ‘feel known’ by their bank and a further third among those who feel they receive a consistent multichannel service – whether in person, by phone or via digital channels.
Christopher Evans, director of Collinson Group, said: “While today the percentage of customers switching their current accounts is low, it is rising year-on-year. Increased competition and the popularity of easy to use comparison websites and switching services are providing greater choice, and creating higher expectation.
“Not being rewarded for loyalty is the biggest frustration for consumers, ahead of poor interest rates and charging unnecessary fees. Many banks offer standardised, transactional loyalty programmes which rely on traditional points-based rewards. With increased competition in the sector, encouraging the most valuable customers to become active members of loyalty programmes can be a powerful tool in improving satisfaction, retention and achieving repeat business.
“Banks need to act now to stop their customers switching and to protect their current revenue. Consumers are increasingly mobile and demand more from their banks.”
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