Posted By Karen Licker, Financial Services Social Media & Marketing (Independent) at J.D. Power and Associates, on March 5, 2012, at 9:34 am
The 2012 U.S. Bank Customer Switching and Acquisition Study is based on multiple evaluations from 5,062 customers who shopped for a new banking account or new primary financial institution during the past 12 months. Below are some highlights from the study, as well as links to how the industry experts are reacting to the results:
- Acquisition of new customers by smaller banks and credit unions has increased by 2.2 percentage points to an average of 10.3 percent in 2012 (from 8.1 percent in 2011).
- Among big banks, regional banks and midsize banks, switching rates average between 10.0 and 11.3 percent, while the defection rate for small banks and credit unions averages only 0.9 percent, a significant drop from 8.8 percent in 2011.
- 9.6 percent of customers in 2012 indicate they switched their primary banking institution during the past year to a new provider. This is up from 8.7 percent in 2011 and 7.7 percent in 2010.
- Fees are the main reason customers shop for a new primary bank. In particular, one-third of customers of big and large regional banks cite fees as the main shopping trigger.
- Regardless of bank size, more than one-half of all customers who said fees were the main reason to shop for another bank also indicated that their prior bank provided poor service.
- In capturing customers who are shopping for a new bank, several of the more successful banks achieve higher acquisition rates through the use of promotions and cash incentives.
- At one of the highest-performing big banks, 19 percent of customers indicate promotions were the reason they selected their new bank.
How are the industry experts reacting to the results of the J.D. Power and Associates 2012 U.S. Bank Customer Switching and Acquisition Study?
USA Today
Los Angeles Times
CNN Money
Reuters
American Banker
Credit Union Times
WONKBLOG by The Washington Post
Forbes
The Financial Brand
Bank Marketing Strategy
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For more information regarding the J.D. Power and Associates 2012 U.S. Bank Customer Switching and Acquisition Study, please contact Holly Zagresky at Holly_Zagresky@jdpa.com
Posted By Karen Licker, Financial Services Social Media & Marketing (Independent) at J.D. Power and Associates, on February 12, 2012, at 9:51 am
This special 5-part “how to” blog series will detail the fundamentals of branch account sales and service delivery including:
- Greeting
- Needs Assessment
- Ensure products meet customer needs
- Cross-selling
- Follow-up
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#2 Needs Assessment
Completely understanding customer needs and recommending products that fully meet those needs!
Why:
- Increases customer satisfaction and the likelihood to purchase more products in the future
- Directly impacts product penetration at that first meeting
- Ensures stronger alignment with and better customer understanding of products’ overall value, pricing and features
- Penetration for credit cards and savings accounts—those most likely to be sold at the initial point of sale—is significantly higher when customers perceive their needs have been “completely” identified, however, only 52% of customers indicate having needs understood and appropriate recommendations made
 Source: J.D. Power and Associates 2011 Retail Bank New Account Study. ©2011 J.D. Power and Associates, The McGraw-Hill Companies, Inc. All Rights Reserved.
How: Ask the Right Questions to Find the Need and Build Value
Ask Open Ended Questions
- An open ended question is the chance to clarify the customer’s needs
- Includes general customer inquiry questions
- Keeps the conversation going because it forces an explanation
- Can’t be answered with a yes or a no
- As the level of trust is increases, the answer will get longer
- Sample open ended questions should include: What brought you into the bank today? Where are you currently banking now? What do you like best about your current bank? What do you like least about your current bank?
Be a Great Listener
- In a sales conversation, be careful not to start talking too soon
- Ask the questions people want to answer (listen and plan for the next question)
- Be a good listener, not a bad talker
- The customer should do most of the talking
- Be an active listener and take notes. It shows the customer you not only heard what they said, but also care about their needs enough to scribe them.
Features Tell & Benefits Sell Service
- Features are important and should be explained clearly. Brochures list features, but don’t simply read from the brochure all account features that exist. Explain the ones that are most important to the customer and speak to them in your own words.
- The customer will not buy bank services because of the features alone like min balance to open account or fees.
- Translate account features into benefits, specifically ones that are most important to them.
- Use figures and perform demonstrations to help translate abstract claims (features) into concrete understandable service points (benefits). For example, demonstrate online banking or calculate for the customer an actual cost savings benefit using real rates.
This is post #2 of a special 5-part “how to” blog series on the fundamentals of branch account sales and service delivery. If you missed it, click here to read post #1 on Greeting Customers.
Posted By Karen Licker, Financial Services Social Media & Marketing (Independent) at J.D. Power and Associates, on January 24, 2012, at 12:31 pm
The use of the internet and mobile devices to monitor account information and conduct routine transactions continues to rise across all the consumer financial services businesses that J.D. Power and Associates measures, from bank to brokerage accounts, from credit cards to mortgages. However, customers overwhelmingly still prefer an in-branch, in-person setting to open new accounts and establish new banking relationships. Both satisfaction with the account opening process and likelihood to use for future products are significantly higher when accounts are opened in person.
This special 5-part “how to” blog series will detail the fundamentals of branch account sales and service delivery including:
- Greeting
- Needs Assessment
- Ensure products meet customer needs
- Cross-selling
- Follow-up
#1 Branch Greeting
Why:
- Greeting customers upon entrance to the branch has a significant impact on overall satisfaction and satisfaction declines by 95 points when customers are not greeted.
- Financial institutions need to encourage all branch employees to take responsibility for ensuring that customers feel welcome and acknowledged, as this not only impacts overall satisfaction but also minimizes the impact of longer wait times customers may experience in the branch.
- Interestingly, overall satisfaction is higher among customers who were greeted upon entrance yet waited 10 minutes or longer in line to see a teller, compared with customers who waited 1 minute or less in line but were not greeted upon entrance (736 vs. 733, respectively, on a 1,000-point scale).
- Mitigating dissatisfaction with long wait times is particularly important for Large banks2, as average wait times are significantly higher (3.5 minutes), compared with Medium and Small banks (2.4 and 1.9, respectively).
- Instituting best practices around branch greeting, since they are behavioral, can be implemented with minimal cost beyond training and coaching. Also consider including these elements within incentive programs.
How:
Follow the five second rule: ALWAYS Acknowledge a customer within 5 seconds of entering the lobby
Stand Up if You Are Sitting!
- Shows respect
- Projects professionalism
- Ask for customer name and use it
Anyone Can and Should Greet a Customer
- Do it before they ask a question
- Make eye contact
- SMILE
- Be sincere
If available, engage the customer in conversation
Service Inquiry
- Customer will tell you why he/she is in the bank
- Customer will typically ask the first question
Thank You
- Thank the customer by name
- Ask the customer if there is anything more you can assist them with (other than the reason for the visit)
The Hand-Off to Another Employee (if applicable)
- Escort the customer to the appropriate branch employee
- Do not shout out to another employee across the branch to direct the customer
- Give a brief intro including customer name and needs
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U.S. Financial Services Study Release Dates for 2013 JANUARY
Social Media Benchmarking Study
APRIL
Retail Banking Satisfaction
Financial Advisor Satisfaction
MAY
Customer Switching & Acquisition
Full-Service Investor Satisfaction
JUNE
Self-Directed Investor Satisfaction
JULY
Primary Mtg Servicer Satisfaction
Dealer Finance Satisfaction
AUGUST
Credit Card Satisfaction
OCTOBER
Credit Card Website Evaluation
NOVEMBER
Small Bus Banking Satisfaction
Mtg Originination Satisfaction
Consumer Auto FI Satisfaction
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FOR MORE INFO regarding these studies, please contact: Holly Zagresky at (248) 680-6319 or via email at Holly_Zagresky@jdpa.com
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