Looking Ahead: Retail Banking in 2014

As the retail banking landscape continues to evolve, banking organizations need to always be tuned in to what customers expect from their bank and how they can provide them with a more satisfying banking experience.

As our J.D. Power Retail Banking Satisfaction Study moves to quarterly fielding and reporting for the 2014 study, banks are . . . Continue Reading Looking Ahead: Retail Banking in 2014

Big Banks Make Big Gains in Customer Satisfaction

Overall customer satisfaction with retail banks improved significantly from 2012, largely a result of improvements made by big banks,(1) according to our J.D. Power and Associates 2013 U.S. Retail Banking Satisfaction StudySM released today.

“Many of the big banks have made great strides in listening to what their customers are asking for: reducing the number . . . Continue Reading Big Banks Make Big Gains in Customer Satisfaction

Will You Bank On Us?

Best Banking Blogs of 2012

The Financial Brand, the premier online publication for bank and credit union marketers is conducting the second most important election this week; Best Banking Blog “2012 Readers’ Choice” awards.

Our J.D. Power and Associates Banking Blog, as part of having received the prestigious “Editor’s Choice” award,  is now nominated for the “Reader’s Choice” . . . Continue Reading Will You Bank On Us?

How Banks Charge Fees Without Jeopardizing Customer Satisfaction

As banks continue to explore ways to manage the sensitivity around charging fees while minimizing the impact associated with charging those fees, it’s important to focus on the following three areas:

1.  Stability

The data from our 2012 U.S. Retail Banking Satisfaction Study shows that fee structure changes not only have a significant impact on customer satisfaction, but they also lead to an increase in problem incidence and intended attrition.  The following are some best practices banks should consider when making changes to fee structures:

  • When changes are necessary, focus on limiting the number of changes customers are forces to accept. For example, making two or three changes to fee structures per year may be more confusing and less satisfying than making multiple changes at one time.
  • When fee changes are necessary, it is critical to communicate the changes well in advance so that customers are not caught by surprise.
  • While communication of fees is mandatory, there are some other ways for financial institutions to help ensure customers are aware of changes—e.g., communicating changes more than once and preferably via multiple channels, such as mailed letter and online notification.
Source:  J.D. Power and Associates 2012 U.S. Banking Satisfaction Study

2.  Communication

The impact of communication on the fee experience goes far beyond simply providing advance notice of any changes to the fee structure. There are other best practices that banks can follow to provide their customers with more information regarding fees or information on other product pricing options available:

Account initiation: Starting with account initiation, it’s vital that representatives perform a detailed needs assessment and identify the products that meets customers’ needs. Performing a detailed needs assessment during account initiation provides a big lift in fee understanding (22 percentage point difference for “completely” identified needs) , while also providing a significant lift in satisfaction.

Online account information: It goes without saying that providing customers with clear and concise access to account information and other pertinent information via the bank’s website is crucial. Clarity of account information and Clarity of information provided on the website provide considerable lifts in Fees satisfaction, while also improving fee understanding by 16 percentage points.

Outbound communication: Proactively contacting customers three or four times per year regarding banking products and services enhances satisfaction and understanding of both fees and product offerings, without creating information overload. Study findings show that satisfaction and understanding both begin to decline when customers receive five or more proactive contacts per year. This also includes performing account reviews to ensure customers have the right products. Empowering branch tellers and call center representatives to proactively review customer accounts and make recommendations for alternative products and pricing options provides lifts in Fees satisfaction and understanding and significantly improves the bank’s Brand Image rating for being Customer driven. Continue reading ›

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Cracking The Code On 3 Major Customer Experience Trends In Retail Banking

Our 2012 U.S. Retail Banking Satisfaction Study finds there are three likely outcomes that banks must contend with during the next few years, and all have direct implications regarding the customer experience.

1. Attrition will rise, loyalty will decline

The good news? There have been marked improvements in the measurement of customer retention, loyalty, and . . . Continue Reading Cracking The Code On 3 Major Customer Experience Trends In Retail Banking

Key Banking Topics in Social Media

The challenges confronting banks that seek to bolster their bottom-line profitability, retain customers, and stay competitive in the marketplace are formidable. Research conducted by J.D. Power‘s Consumer Insight and Strategies Group to track social media activity regarding banking issues between April 2011 and March 2012 finds that:

  • Online sentiment was distinctly negative not only regarding fees, but also for bank technology
  • Complaints associated with website or online issues were a major source of discontent in technology-related messages

With customer feedback on critical topics discussed online going from technology to fees and service, banks should see the handwriting on the wall and provide an appropriate outlet for these customers, along with an acknowledgement and guidance for direction for immediate response.

Source: 2012 J.D. Power U.S. Retail Banking Satisfaction Study

Retail Banks aren’t the only ones that have an opportunity to engage with the vocal online customer. Credit card holders appear to be even more outspoken onlinne, but card issuers appear to have learned this a bit faster than their Retail Banking peers. Continue reading ›

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3 Action Items to Bolster Satisfaction While Cutting Costs

Bankers have entered the new “Post-Recession Reality” and reality is indeed setting in. In light of all the external pressures within the industry, bottomline profitability will be even more elusive to attain in the months and years ahead. Increased regulatory pressures, fee restrictions, diminutive margins, soft loan demand coupled with ongoing credit risks, and . . . Continue Reading 3 Action Items to Bolster Satisfaction While Cutting Costs

Big Banks Improving in Reducing Number of Problems Experienced and in Problem Resolution

Facilities and Routine Interactions Offset Decreasing Satisfaction with Fees

Highlights from our 2012 U.S. Retail Banking Satisfaction Study(SM)

  • Overall retail banking customer satisfaction has improved by one index point in 2012 to an average of 753 (on a 1,000-point scale) from 2011.
  • When looking at banks in aggregate by relative size, satisfaction with big banks is 743, a two-point increase from 2011, while satisfaction with midsized banks is up four points to 781. Regional banks experience a slight dip in overall satisfaction, to 759 from 760 in 2011.
“Big banks continue to lag the other banks in overall satisfaction, but they have made significant improvements in reducing the number of problems customers experience and in problem resolution, specifically resolving problems on first contact,” said Michael Beird, director of banking services at J.D. Power and Associates.
  • While consumers are growing increasingly dissatisfied with fees, banks are able to offset it with higher satisfaction in other areas, such as banking facilities, account activities and problem resolution.

Fees:

  • Satisfaction with fees has declined to 609, down significantly from 625 in 2011 and from 656 in 2010.
  • Monthly maintenance fees have the most significant negative impact on fees satisfaction this year—more so than in the 2011 and 2010 studies—while fees assessed for ATMs and debit cards have less negative impacts on fees satisfaction.
“The negative reaction to fees reflects customers’ irritation about paying for something they didn’t have to pay for in the past,” said Beird. “It also reflects a lack of their complete understanding about what they’re getting for those fees. Customers understand why they’re being charged for ATM and debit card use, but are not clear on what they’re getting for monthly maintenance fees, which drives the bigger drop in satisfaction with those fees.”

Banking Facilities:

  • Customer satisfaction with bank facilities—branch and ATM locations, appearance and hours of operation—has improved this year to 779, compared with 771 in 2011 and 765 in 2010.
  • One behavior helping increase satisfaction with the branch is that 76 percent of customers say they are greeted by a bank employee when they enter the bank, an increase from 68 percent in the 2010 study.
  • Customer satisfaction with the reliability and ease of using ATM machines has increased to 815 from 795 in 2011.
The study measures satisfaction among banks in 11 regions. Study results by region are: Continue reading ›
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Voice of the U.S. Retail Banking Customer

Next week, we’ll be releasing our 2012 U.S. Retail Banking Satisfaction Study (SM). 

This study will explore why its a must for banks to understand their customers’ needs on both individual and regional levels, and identify what actions they should take in order to meet their customers’ expectations.

Get an insider’s look!

Join us for the . . . Continue Reading Voice of the U.S. Retail Banking Customer