According to a new analysis by international researching the market, company GfK and Personetics, a innovator in customization technological innovation for financial institutions, less than one-third (31%) of clients feel their bank know them and their economic needs well. And nearly the same amount (28%) says that their financial institutions put their own passions before customers’ needs.
While the research found many clients sensation turned off from their banks, thankfully banks have some driveway to turn the connections around. Many clients do not have programs to change banks time soon, with only 5% saying they are likely to do so in the next 6 months.
The research segmented US customers into three personal connection categories depending on whether the client interprets his or her financial institution as a:
Necessary Application (must use to handle day-to-day finances)
Useful Support (helpful but not individual to the client or his/her situation)
Trusted Associate (offers customized assistance and support)
The research found that only about one-quarter (27%) of respondents view their banks as trusted partners, while nearly 40% see them simply as necessary utilities – entities they have to do business with to manage finances. About a third of consumers are in the middle, seeing their banks as generally helpful, but not on a direct, personal level.
“At a time when consumers have so many financial options, banks need to do more to shore up their all-important relationships with customers,” said Keith Bossey, Senior Vice President at GfK. “Our findings suggest that this trend is actually weakening engagement and loyalty, in no small measure because customers are not finding their bank helpful when it comes to improving financial well-being.”
Things change when banks get personal
The study found that perceived value in an increasingly digital banking environment is not just about access, data and ease of use; when consumers see their banks as trusted partners that help them with their day-to-day finances, a variety of other important measures are also enhanced:
Likely promoters of the bank’s brand more than doubles, from 35% to 74%
The proportion of potential defectors to other banks falls from 34% to 7%
Reported emotional states when dealing with one’s bank improve markedly:
Am looking forward to the future” jumps from 35% to 59%
Feel gratitude in relation to my bank” jumps from 34% to 62%
Feel happiness when dealing with my bank” nearly doubles, from 36% to 66%
Am pleasantly surprised when dealing with my bank” doubles, from 20% to 39%
Feel a sense of control” goes from 52% to 73%
How might banks drive higher trust and engagement through personalization? See Chart 2 for examples of customer insights that a few innovative banks are beginning to offer customers. According to Personetics, consumer reaction to this type of personalized guidance has been highly positive; but the GfK-Personetics survey results reveal that most banking customers are not receiving such guidance from their banks.