Posted By Karen Licker, Financial Services Social Media & Marketing (Independent) at J.D. Power and Associates, on December 6, 2012, at 7:07 am
Original post by Banking.com Staff on December 4, 2012
In a recent blog on Banking.com, we explored how small businesses don’t always get the respect they deserve from the banking world. There’s no question that this sector of the economy is always vital, and increasingly optimistic. In fact, the number of businesses that report being ‘better off’ jumped from 16 percent in 2009 to 33 percent in 2012. This is also a market rich with possibility: on average, small businesses hold deposits four times greater and loan balances 15 times greater than retail banking customers.
And yet, this market continues to rank near the bottom in banking satisfaction. So what’s going on—and what can the industry do to make thing better? The new J.D. Power and Associates 2012 US Small Business Banking Satisfaction Study, a comprehensive research report that identifies and highlights the situation described above, digs deeper into the problems and identifies many of the pain points.
As mentioned in the previous blog, credit is still the primary issue, but it’s not the only one. The J.D Power study lays out more fundamental problems too. In particular, while small businesses are sometimes lumped in with retail banking, there are major differences between the two. Continue reading ›
Posted By Karen Licker, Financial Services Social Media & Marketing (Independent) at J.D. Power and Associates, on November 9, 2012, at 11:22 am
Our J.D. Power and Associates 2012 U.S. Small Business Banking Satisfaction StudySM suggests that banks should focus on small business customers because of the value they represent, when compared to retail customers. On average, small businesses hold deposits four times greater and loan balances 15 times greater than retail banking customers.1 Small business customers also carry higher levels of personal banking business than the average consumer. In addition, the profit margins on small business customers are typically larger than those on larger corporate banking customers.
Yet, based on the results of the study, just released today, it appears that small businesses, like Rodney Dangerfield, get no respect. Despite overall satisfaction increasing by 19 index points year over year to 736 (on a 1,000-point scale) in this year’s study, it still represents one of the lowest-scoring financial services businesses that J.D. Power and Associates examines. Only mortgage servicing is lower. Even its perennial low-scoring counterpart, credit card, has surpassed small business banking in satisfaction to levels enjoyed in the retail banking sector.
Now in its seventh year, the study measures small business customer satisfaction with the overall banking experience by examining eight factors: product offerings; account manager; facility; account information; problem resolution; credit services; fees; and account activities.
The Small Stuff Matters
The study finds that when small business banking customers are greeted by name, the positive impact on overall satisfaction is 106 points. However, this occurs only 47 percent of the time, compared to 64 percent of the time among retail banking customers, representing a 17-percentage-point gap. This disparity occurs even though small business customers bank in person at the branch more than twice as often as retail customers (36 times vs. 16, respectively, on an annual basis). Continue reading ›
Posted By Karen Licker, Financial Services Social Media & Marketing (Independent) at J.D. Power and Associates, on November 1, 2012, at 8:58 am
In case you missed a few of our recent online events and complementary research reports, we’re including them for you here. We promise, just like the day after 1/2 price Halloween candy, it’s not a trick. Just a heartfelt way for us to treat you, our loyal banking fiends and fans for your continued support. Enjoy!
What Do Small Business Owners Expect From Their Bank?
This exclusive webcast provides an inside look into the results of our J.D. Power and Associates 2012 US and Canadian Small Business Banking Satisfaction Study that will be released next week. Below are only some of the many issues discussed during the webcast:
How customers’ perceptions have changed since 2011
The latest trends emerging in the small business banking industry
Which factors are having the biggest impact on customer satisfaction
The Dividends of Improving Best Practices for Social Media Research
In this whitepaper, we’ll show you that without well-established and proven guidelines on query construction and data extraction, very different results and conclusions can be obtained by different analysts attempting the same social media data search.
In extreme cases, analysts can create such highly divergent queries that the associated data leads to different answers to even simple questions, such as:
Which brand is my main competitor?
Is Product1 more of my brand’s conversation this month centered around product?
Is the sentiment expressed toward my brand this month more or less positive than the sentiment expressed toward my brand last month?
Using Voice of the Customer Information to Improve Business Performance: 5 Keys to Success
This presentation explores how clients use J.D. Power and Associates and other Voice of the Customer data with ROI or other business metrics to analyze under-performance to drive improvement.
Posted By Karen Licker, Financial Services Social Media & Marketing (Independent) at J.D. Power and Associates, on October 18, 2012, at 11:46 am
With the fluctuating economy and new banking regulations continuing to affect the expectations that small business owners have of their banking experiences, financial institutions need to be armed with the insights that can help them meet and exceed these expectations. They need to know:
How customers’ perceptions have changed since 2011
The latest trends emerging in the small business banking industry
Which factors are having the biggest impact on customer satisfaction
Our J.D. Power and Associates 2012 US and Canadian Small Business Banking Satisfaction Studies will provide these insights and much more!
Join us for an exclusive webcast during which we will give you an insider’s look into the results of these studies!
Webcast Details:
DATE: Tuesday, October 30
TIME: 2:00 – 3:00 PM ET
SPEAKER: Jim Miller, Senior Director, Banking Practice at J.D. Power and Associates
Posted By Michael Beird, Director of Banking Services Practice at J.D. Power and Associates, on November 5, 2011, at 3:31 pm
I have the distinct honor of presenting the J.D. Power trophy to M&I Bank for the closing session at the Small Business Banking Conferencenext week in Scottsdale, AZ. I have been asked by a number of bankers and media alike what Small Businesses found most satisfying this year in their banking relationships with M&I Bank. From our research, here is a brief summary of what stood out most in contributing to their achievement.
Account Management: 77% of M&I Bank small business customers reported they had someone assigned to their relationship. Our research shows that small companies, particularly those under $1 million in annual sales, appreciate having a name of someone who is knowledgeable and caring. Ironically, frontline Customer Service Representatives score just as well as Business Bankers in satisfaction for these smaller firms. As needs grow more complex, of course, the role of a Business Banker or Branch Manager becomes the more likely contact.
Problem Incidence: Problems are a fact of life and no one knows that more than small business owners. However, avoiding problems is key to satisfying customers and M&I Bank had the lowest reported problem incidence rate for the 24 banks in the study, 25% versus the industry average of 37%. In many cases, banks with fewer problems demonstrate the ability to answer questions and resolve issues at the point of contact, before a concern becomes a problem in the customer’s mind.
In-person Performance: M&I Bank had strong performance this year in both the efficiency associated with servicing branch customers, as well as the knowledge demonstrated by frontline personnel. While Online continues to grow in importance as a primary channel for information and routine transactions, Small Businesses are still dependent on branches for many day-to-day activities. Focusing on branch fundamentals such as peak time staffing, courtesy, product knowledge and proactive communication remains an important priority in achieving customer satisfaction for these customers.
These are just a few of the performance elements from this year’s research that made a difference to the customers of top performing banks and demonstrate just how important personal service is to the Small Business owner.
Congratulations again to M&I Bank on this year’s achievement in J.D. Power and Associates 2011 Small Business Banking Study!
Posted By Karen Licker, Financial Services Social Media & Marketing (Independent) at J.D. Power and Associates, on November 2, 2011, at 1:49 pm
The study, now in its sixth year, measures small business customer satisfaction with the overall banking experience by examining eight factors: product offerings; account manager; facility; account information; problem resolution; credit services; fees; and account activities.
Drivers of Satisfaction Among the Highest Performers Include:
Relationship management and the quality of assigned contacts
Positive in-person experience
Expedited problem resolution
*Effective July 2011, BMO Financial Group, the parent company of BMO Financial Corp., acquired Marshall & Ilsley Corporation (M&I). As a result, M&I Marshall Ilsley Bank, M&I Bank N.A. and The Harris Bank N.A. have since merged into Harris N.A.
Source: J.D. Power and Associates 2011 U.S. Small Business Banking Satisfaction Study
Charts and graphs extracted from this post must be accompanied by a statement identifying J.D. Power and Associates as the publisher and the J.D. Power and Associates 2011 U.S. Small Business Banking Satisfaction Study SM. No advertising or other promotional use can be made of the information in this post or J.D. Power and Associates survey results without the express prior written consent of J.D. Power and Associates.
Posted By Michael Beird, Director of Banking Services Practice at J.D. Power and Associates, on October 25, 2011, at 1:50 pm
Everyone probably remembers that one kid in school who just never fit in or was not accepted by the other kids in the class. Maybe he was too smart…or shy…or short…or tall. But whatever the reason, he just didn’t fit in. Gym class was the worst, of course. When it came time to choose up teams, the kids would fight over who would have to take him onto their team. For the last kid chosen, the gym teacher would often have to assign him to one team or the other while the other kids groaned or complained how unfair it was. Childhood is a painful time and not knowing how or where you fit in can be a troubling feeling that creates stress, sadness, confusion and frustration.
That situation is typical of what Small Business owners go through with their banks. It often starts off well enough, with the Customer Service Rep making the customer feel like the bank values his business. He gets introduced to the staff and even has a wonderful bank calendar for the office! Life seems great, at least until something goes wrong, or questions arise….maybe the first statement arrives with a few surprise fees. He calls the 800 number on the statement but gets transferred around because it’s ‘a business account’ and the agent cannot access those accounts. After several frustrated calls, the customer soon discovers that Small Businesses often get lost in the banking ‘abyss’.
What’s going on? Many banks lack a strategy on how to handle the Small Business owner. He may be assigned to the Mid-Market or Commercial Division, in which case his $2M annual sales is a rounding error compared to average accounts in Corporate. Or he is assigned to the branch, but his needs are more complex than the average consumer and the branch staff lacks the focus, time or capacity to take the time to understand his needs. In other words, no one wants to choose the Small Business owner for their team and the gym teacher ends up assigning him to a team by default. Continue reading ›
With a lackluster economy continuing to discourage small businesses from hiring and taking risks to grow their companies, bankers have a vested interest in supporting their small business customers. Few small businesses have the cash flow, in-house expertise or human capital required to expand through long rough patches in the economy, so they must rely on support from the greater business community, including their banking partner.
Having worked with thousands of entrepreneurs in the past 20+ years, I have discovered that it’s simply not enough to work hard. Small business owners have to work smart and perform key growth activities that impact their business’s success. What are those growth activities that make a real impact? My newest book, Lucky By Design: Navigating Your Path to Success, focuses on this very topic. In a study of entrepreneurs from around the world, I discovered that business owners who considered themselves to be lucky in business were 2 to 3 times more heavily engaged in specific business growth activities than entrepreneurs who thought luck had no impact on their business. These key success activities, or levers as I refer to them in the book, include: market research, business planning, product development and sales expansion. I found clear evidence that there are ways you can design your own luck (no four leaf clovers or horseshoes required). Perseverance, a great attitude and confidence are important ingredients. However it’s essential to be prepared for inevitable encounters with growth opportunities because a business owner’s ability to recognize these lucky breaks is significantly hampered without a solid roadmap (business plan) and the financial resources required to seize these opportunities.
It is in a banker’s best interest to partner with their small business customers to help them create a Lucky Roadmap. What should you be looking for? Continue reading ›
Posted By Karen Licker, Financial Services Social Media & Marketing (Independent) at J.D. Power and Associates, on October 18, 2011, at 9:28 am
With the fluctuating economy and new banking regulations continuing to affect the expectations that small business owners have of their banking experiences, financial institutions need to be armed with the insights that can help them meet and exceed these expectations. Tell us what you think small business owners care about most! We’ll compare poll results with our research findings next Monday, October 24th at 2:00pm EST during our 2011 Small Business Banking Satisfaction Webcast. Poll participant info is anonymous, but results are not. Register Now to receive an insider’s look into the study results!
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U.S. Financial Services Study Release Dates for 2013
The 2011 Small Business Banking webcast recording is now available!
I have the distinct honor of presenting the J.D. Power trophy to 
Everyone probably remembers that one kid in school who just never fit in or was not accepted by the other kids in the class. Maybe he was too smart…or shy…or short…or tall. But whatever the reason, he just didn’t fit in. Gym class was the worst, of course. When it came time to choose up teams, the kids would fight over who would have to take him onto their team. For the last kid chosen, the gym teacher would often have to assign him to one team or the other while the other kids groaned or complained how unfair it was. Childhood is a painful time and not knowing how or where you fit in can be a troubling feeling that creates stress, sadness, confusion and frustration.
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