Highlights from the 2011 World Retail Banking Report

The headline from the Capgemini/UniCredit/Efma press release is right on target, “While majority of banking customers are satisfied with their retail banks, a renewed focus still needed on customer experience according to 2011 World Retail Banking report.” The 2011 Voice of the Customer survey was developed based on surveys of nearly 14,000 bank customers across 25 countries, as well as 50 in-depth interviews with senior banking executives. According to the study, banks generally deliver positive customer experiences, with an average score on the Capgemini Retail Banking Customer Experience Index (CEI) of 72.2 out of 100. (U.S. Banks were rated the highest with a score of 78.0).

However, banks are less successful delivering positive experiences on the products, channels and banking interactions that are most important to customers. Only 35.8% of customers had a positive experience on factors they claimed are most important to their banking experience. “The industry can be commended for maintaining overall sound satisfaction levels, but indeed banks need to move towards providing experiences in the areas that matter most to customers,” said Alessandro Decio, Senior Executive Vice President, Head of Family and SME Division, UniCredit.

Highlights from the report:

  • Tools banks have used in the past to differentiate themselves – low prices and innovative products – are quickly losing their ability to provide an edge… Delivering a positive customer experience is one of the few levers banks can use to stand out in today’s market.
  • When it comes to banking, customers are most interested in receiving top-quality, personalized service from their banks.
  • Capgemini’s Voice of the Customer survey underscores that service is a top priority to customers. It found that service quality and ease of use are the most important factors for choosing a bank, for 63% and 64% of customers respectively (note: the research we have conducted at Prime Performance, as well as most research from other sources, indicates that branch location is by far the most important factor in selecting a bank, at least in the U.S.).
  • Quality of service is the most important factor customers select as the reason why they leave a bank, followed by ease of use, 55% and 51% respectively (see chart).
  • Banks are taking a closer look at the ways in which they incent and reward branch employees. Increasingly, they are using customer satisfaction as a key measure of employee performance. This process requires more frequent measurement of customer satisfaction and clear communication of the results to branch staffers.
  • Banks are delegating greater responsibility and authority to local branch managers, enabling them to more quickly resolve customer problems or respond to inquiries, enhancing the customer experience.
  • Customers still consider the branch a top channel for carrying out their banking business, despite the growing influence of direct channels. Customers like visiting branches for face-to-face interactions and quality of service.

What can you learn from this report? First, customers value the branch and it continues to play an important role in bank distribution networks. While branch visits have declined in North America, the study shows customers are expected to make nearly 28 visits a year in 2015. Banks need to continue to invest in their branch networks. Second, this study and others show that customer experience is the primary way banks can differentiate themselves and the best path to revenue and customer growth. Finally, banks need to focus on, and invest in, improving the customer experience. Front line employees need to understand the importance of customer service and the role they play in customer satisfaction, have the authority to resolve customer problems, and get timely feedback through frequent customer satisfaction measurement.

At Prime Performance, we have seen the truth of so many of the points made in this study. While working exclusively with financial institutions over the last 20 years, we’ve seen the importance of creating a shared vision of the customer experience across the entire organization. Implementing a program like Prime Performance will allow you to make sure service expectations are being met in all of your branches by all employees. This shared focus is key to providing quality customer service and creating a branch network that is easy to use, which are the most important factors for choosing a bank.  Is your client experience a strategy or an afterthought?

You can find a full copy of the Capgemini/UniCredit/Efma 2011 World Retail Banking report, here (registration required) or here (no registration required).

Send an email to Jim S Miller, the author of this post, at jim.miller@primeperformance.net.