Banking Customer 2020 - Rising Expectations Point to the Everyday Bank
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Banking Customer 2020 Rising Expectations Point to the Everyday Bank
Eight trends around customer attitudes, expectations and behaviors are directing the future of banking. For a decade now, the Accenture Global Consumer Pulse Research study has annually tracked the intentions and actions of consumers around the world. This year’s study included a special and significant cut for retail banking, sampling more than 16,000 bank customers. Banking survey results echo the industry reality that digital is the pulse of banking customer interactions. It continues to influence customer behavior, expectations and needs, to the point at which all customers are now digital customers—albeit ones who move at different speeds. Yet, findings also show banks’ continuing vulnerability to churn as customers still encounter confusing web sites, staggering call center wait times, and difficulty solving their problems regardless of the channel they use. What can banks do to drive customer engagement and capture a greater share of the digital opportunity? Become an Everyday Bank, placing themselves at the center of a digital, interconnected ecosystem of cross- industry providers and services that serves customers’ everyday needs. Winners will be those that manage to show solid customer metrics with strong retention/engagement. Retail banking view of the Accenture Global Consumer Pulse Research annual study • Assessed consumer attitudes toward the customer experience (including marketing, sales and customer service practices) and consumers’ behaviors in response to companies’ practices. • Surveyed global, cross-industry sample of more than 23,600 end customers with online access in 33 countries via the Internet. Each respondent could evaluate up to four out of ten industries. • For Retail Banking, this resulted in a sample of 16,528 decision-making respondents. • Selected bank-specific questions were asked to a sub-sample of 9,000 respondents across 12 key growth markets identified as banking. 2 | Banking Customer 2020: Rising Expectations Point to the Everyday Bank
Every Bank Customer
Is a Digital Customer
While consumers have embraced digital technologies to varying
degrees, digital has become more important to consumers
across the board. Some consumers have completely “gone
digital”—20 percent of bank customers are digital-only users,
preferring to prospect and purchase online.
At the opposite end of the spectrum variety of contact channels in specific
are consumers who still lean heavily on industries to meet select needs. By focusing
traditional channels, but even they are on millennials, most companies are missing
likely to use available digital channels at an important opportunity.
different times for certain activities.
Enabled by technology, customers expect
Most banks’ customer strategies, fueled to easily control and vary their routes
by customer analytics, will need to change within and across channels to suit their
to really take advantage of customers’ needs at any given moment. While customers
new channel preferences. For example, move at different speeds and take different
our research shows that consumers paths, every customer is now a digital
between 18 and 34 years, those who customer – from the traditional customer
have grown up immersed in digital to the digital-savvy one (Figure 1).
technologies, are two to three times
more likely than consumers older than As a result, customers find it easier to
55 to want more digital interactions than compare a provider’s promise with its
companies currently support. Yet our delivery and how the overall customer
experience shows that the older group is experience meets their own expectations—
surprisingly open to adding other channels and subsequently make changes if they
to their portfolio and is experimenting find their bank isn’t as “digitally intense”
with online interactions, using a wider as they would want it to be.
FIGURE 1. Every Customer Is a Digital Customer
Traditional Experimental Transitional Digital Savvy
They rely on traditional They selectively engage They strive to They make digital
channels & interactions. in digital for utility leverage digital technology part of all
Even then, they leave value, discovering how more broadly but dimensions in their life.
digital traces. the experience improves. may not always be Mobile access is key.
able to do so.
Increased Speed
Higher Digital Customer Intensity
3Eight Trends to Influence
Banks’ Strategies
The good news is that retail banking, along with a few other Our research identified eight trends to
influence banks’ strategies, compelling
industries, remained in the top sectors who provide a positive more of the right tactics to both quell
customer experience. Our study found that 36 percent of global customer churn and keep pace with a
bank customers are extremely satisfied, one-third feels loyal quickly-evolving consumer base.
to and 28 percent would recommend their providers. Across
Trend #1: Customers are
satisfaction and loyalty, retail banking scored higher than the buying, but less so from
global cross-industry averages. current providers
Globally, 27 percent of bank customers
However, an important portion of banking than two providers. Four out of the 10
purchased/subscribed to a new financial
consumers continue to actively consider financial products owned by customers on
product/service over the last six months,
their choices. Our survey found that 18 average are from outside their main bank.
in line with 2013 findings (Figure 2). This
percent of bank customers switched com-
proportion is much higher in emerging
pletely and 27 percent added new provid- Leading banks around the world recognize
markets (39 percent) than in mature ones
ers. Over the last five years, the combined the shift in consumer behavior and what’s
(20 percent). Yet over the past six years,
switch rates (customers who switched at stake: market share. They continue to
the proportion of consumers in our study
completely from one bank to another or invest in customer retention and ways to
who expressed their intention to buy less
partially by adding new providers to existing attract other consumers in search of better
from their current providers has increased.
ones) increased globally by eight percent. alternatives. The challenge is whether or
In the past three years, 58 percent of not banks’ actions are hitting the mark
consumers have done business with more when it comes to their customer strategies.
FIGURE 2. Purchases situations
Which of the following purchasing situations have you carried out in the past six months?
Mature Markets Emerging Markets
I purchased clothing or accessories such as women/
70% 79%
men/kids wear, sportswear, shoes, bags, etc.
I purchased a new electronics device like a PC, a
43% 68%
smartphone, a TV set, or a game console
I purchased a hotel stay/accomodation for a
42% 42%
personal vacation
I selected a health care provider (hospital, clinic,
physician’s office) for a medical exam, consultation 28% 41%
or procedure
I purchased an insurance for a car, motorbike, boat,
26% 40%
home/apartment (against fire, flood, etc.)
I purchased/subscribed to a new financial services
20% 39%
product with a bank/financial institution
I subscribed to a service with a wireless phone 20% 28%
provider (with or without a new handset)
I subscribed to a new pricing scheme or service
13% 18%
provided by a gas or electricity provider
I did not purchase any of these 10% 4%
Base = 23,665 (total global respondents)
4 | Banking Customer 2020: Rising Expectations Point to the Everyday Bank80 percent said they could have been
Trend #2: First-contact
retained, mainly if their issue had been
resolution is key to retention resolved on their first contact with the
Good competitive pricing, high quality bank. Yet first-contact resolution has
customer service and good value for money consistently remained the top frustration
are the top three dominant factors that factor for consumers in the past five years
convince customers to switch to another (generally cited by around eight in 10), and
bank (Figure 3). It’s not a coincidence the percentage of consumers expressing
that banking also has been among the satisfaction with how companies have
most highly disrupted industries by digital handled it has increased only marginally
technologies in recent years. Of the since 2009 (from 41 percent to 45 percent).
consumers who switched to another
provider due to poor service, more than
FIGURE 3. Reasons for complete switch
How much did each of the following reasons contribute to your decision to switch/
stop doing business? (Check up to top three reasons)
Good competitive pricing 39%
High quality customer service 34%
Good value for money 32%
High quality product/services 24%
Easy to do business with 18%
Trustworthy 17%
Broad product/services range 16%
Skilled workforce aware of needs 15%
Tailored customer experience 15%
Service not required 15%
Engaging communications 11%
Innovation 7%
Digital interaction and/or services 7%
Sustainable business practices 5%
Base = 2,984 (retail banking customers who switched completely)
5Trend #3: Digital channels
have significantly increased the
number of overall interactions
Consumers continue to rely on multiple
channels (an average of three or more)
when prospecting, with the corporate
website and online expert/comparison
sites most relied on followed by word-
of-mouth, online reviews and branches.
More than last year, 58 percent of bank
customers use mobile devices often when
prospecting or seeking support. Out of the
average 17 interactions per month made
by a customer with its main bank, seven
are through on-line banking and three are
through mobile/tablet. Emerging markets,
where the average of total monthly
interactions is 21, display an even higher
propensity to use digital channels (Figure 4).
Despite being satisfied with Trend #4: After switching to
digital, customers are looking
online customer service channels for more services
Despite being satisfied with online customer
compared with traditional service channels compared with traditional
channels, consumers are ripe for more.
channels, consumers are ripe Globally, online banking is very frequently
used for prospection and access to services,
for more. but less to fix issues (Figure 5). Online
subscriptions grew six percent to 60
percent; mobile is used more for them
while branches are used less. Of consumers
who seek advice in the branch, half of
them use an online channel to purchase/
subscribe. Still, 61 percent of banking
customers expect to have access to more
online interactions across their lifecycle.
Several barriers banks will need to address
completely include the lack of the right
information provided by the channels, lack
of trust in them and lack of knowledge of
how to access and use them.
6 | Banking Customer 2020: Rising Expectations Point to the Everyday BankFIGURE 4. Interactions by channels
How many times do you usually interact/get in touch with your main bank, on monthly basis, using the methods listed?
(Provide number of interactions)
25
24 23
21 1 1
21
20 1 3 2
2 18 18 18
17 2
16 2 3 17
1 16 2 1 1 1 16
1 15 15
15 3 1
1 2 4
1 4 3 3 1 1 2
2
3 2
2 2 1 6 2
4 2
5 3
10 4 4 4 3
4 4 5 5 4 7
2
3
5 10 9
9 8 8 8
7 8 7 7 7 7
6 5
0
Total Mature Emerging Spain Australia France UK Italy Canada Germany US Indonesia Brazil China
Other digital banking** Telephone call centre Social Media Branch Mobile/Tablet banking Cash machine/ATM Internet banking
*Base = 9,000 (Total retail banking respondents in12 key markets: Australia, Brazil, Canada, China, France, Germany, Indonesia, Italy, Spain, UK, US
**Other Digital Channels = Video chat and Instant messaging
FIGURE 5. Most frequent banking activities by channel
How frequently do you use the methods listed below with your main bank?
RESEARCH & ADVICE ACCESSING SERVICES FIXING ISSUES
(e.g. seeking advice, finding offers, rates) (e.g., making a payments, money transfer) (e.g. update details, manage a complaint)
Internet Branch Cash Call Mobile/ Social Internet Branch Cash Call Mobile/ Social Internet Branch Cash Call Mobile/ Social
Banking machine Center Tablet Media Banking machine Center Tablet Media Banking machine Center Tablet Media
& ATM Banking & ATM Banking & ATM Banking
64% 42% 61%
48% 23%
15%
44%
12% 21% 50%
43% 30% 12%
24% 37% 13%
32% 32% 17% 34%
14% 24% 15%
20% 13% 11%
12% 14% 16% 18% 15%
10% 10% 11% 9% 10%
32% 34% 46% 56% 64% 76% 22% 21% 23% 63% 59% 78% 47% 35% 65% 55% 70% 79%
At least once a month At least once a year Never
*Base = 9,000 (Total retail banking respondents in12 key markets: Australia, Brazil, Canada, China, France, Germany, Indonesia, Italy, Japan, Spain, UK, US
7Trend #5: High, but slower FIGURE 6. Core drivers of satisfaction
What you like about the companies you do business with today?
growth in, customer service
(Rating scale: 1 = Does not describe at all, 10 = Describes very well)
expectations gives banks a
Trustworthy 35%
chance to catch up
In line with last year, trustworthiness, Skilled workforce aware of needs 33%
employee skills, high quality of services High quality customer service 32%
and ease of doing business are the core
Easy to do business with 32%
drivers of customer satisfaction for
banking with more than 30 percent of Broad product/services range 27%
consumers agreeing to it (Figure 6). Yet, High quality product/services 27%
while the general pool of consumers’
expectations for customer service have Tailored customer experience 27%
increased greatly since 2007, growth is Offer digital experience in
26%
interaction/services*
slowing, which gives companies a chance
Good competitive pricing 24%
to catch up. Unfortunately, the percent-
age of consumers switching due to poor Good value for the money 23%
service has decreased only slightly during 23%
Engaging communications
that time, indicating that most companies
are still not giving consumers the kind of Innovation 23%
service they want. Indeed, the percentage Sustainable business practice 17%
of consumers saying their biggest frustrations
with providers—failure to deliver on their Core drivers of Satisfaction (Top 3 boxes)
promises, inefficient and slow customer Base = 16,528 (total retail banking respondents)
service, and lack of interaction convenience—
have remained consistent in the past
few years.
Trend #6: Customer loyalty FIGURE 7. Loyalty programs
Have you participated in any companies’ customer loyalty programs over the past
program adoption is rising,
12 months?
but fails to keep customers
Participation (at least 1 program)
committed for the long haul 55%
Retailers 54%
Across industries, the percentage of 53%
consumers saying they participate in at 33%
least one customer loyalty program has Banks 31%
29%
increased since 2009, as has the percentage
30%
indicating such programs persuade them Wireless/cell phone companies 30%
to stay with a provider. One-third of 32%
banking consumers participated in at least 28%
Internet service providers 27%
one loyalty program, about the same as 30%
last year (Figure 7). Efficiency of the 25%
banking loyalty programs (measuring Airlines 25%
24%
customers who stayed with their providers 25%
because of the program) remains at around Hotels 24%
24%
56 percent. However, program adoption
21%
is primarily driven by the desire to gain Home telephone service providers 21%
access to the “best deals,” indicating a sort 23%
of short-term loyalty that fails to keep 22%
Utility companies 21%
customers committed for the long haul. 22%
While consumers stated increased loyalty 21%
Cable/satellite television
due to such programs, their actual 20%
service providers 22%
behaviors indicate they continue to
*Life Insurance Providers and 19%
leave providers at a high rate. 18%
Property & Casualty (P&C) insurance 16%
2014 2013 2012
* Fixed Service Provider (excluding Cable/Satellite) replaced Landline Phone Service Providers in 2014)
** Life Insurance Providers & Healthcare Providers included in 2014
8 | Banking Customer 2020: Rising Expectations Point to the Everyday BankTrend #7: Compelling offers Trend #8: “Non-traditional” Accenture 2014 North America Consumer Digital
1
Banking Survey
could win back customers competitors are gaining 2
Accenture, The Everyday Bank: A New Vision for the
Digital Age, 2014
More than 30 percent of consumers ground with consumers.
switched their bank providers in the past Across industries globally, 44 percent of
six to 12 months due to good competitive consumers would be open to consider
pricing, high customer service quality or products and services from companies
good value for money. In line with last that are not generally considered part of
year’s findings, 27 percent of consumers traditional industry definitions; 43 percent
would shop for better deals and 31 percent would be open to products/services from
find the switching hassle to be low. other consumers, not companies. In banking,
Offering differentiation is only perceived other Accenture research recently showed
by about a fourth of consumers and less that nearly half of customers would likely
than one-in-six profess a high industry bank with a company they currently do
involvement. About one-third of consumers business with but that does not currently
across industries who switched from a offer banking services.1 The number
provider said they would consider returning surpasses 70 percent for those ages 18
within two years for better pricing or a to 34. This includes financial players such
superior product. That’s the good news, as PayPal, Inc., and Square, Inc., and brands
and a real mindset shift for companies outside the financial sector like Apple,
that miss this opportunity. Inc.; Google, Inc.; and Amazon.com, Inc.
Accenture separately estimates that
competition from non-banks could erode
one-third of traditional bank revenues in
North America by 2020.2
9How Banks Can Keep
and Win Customers
Simply “being more digital”—closing down branches and rolling One-third of all customers are generally
open to such a business model that we
out better mobile and online banking services, for example— call the Everyday Bank. Banks that want
will not give banks the differentiation they need to capture the to lead the trends rather than follow will
attention of, retain and best serve today’s digital customers. become an Everyday Bank, placing them-
selves further into the commercial lives
of their customers and satisfying a broad
When analyzing consumers’ attitudes market types. On the contrary, innovative
range of life-cycle needs before, during
towards innovative banking models, the banking models based on the bank offering
and after moments of financial transactions.
survey shows that those models that a range of both banking and non-banking
As part of a digital ecosystem, the
heavily incorporate digital (for example, services generate higher interest and
Everyday Bank assumes three distinct,
a pure digital bank), garner very different positive reactions across all countries.
digitally-powered roles (Figure 8):
levels of acceptance. Mature markets—the Specifically, a bank that is able to address
US, Canada, Australia and Europe—are real needs and provide strong value for • Advice Provider: recommending
much more cautious while emerging or money, using partnerships with non- specific, targeted buying suggestions
“growth” markets show a largely favorable banking players that bring a wider range • Access Facilitator: to financial services
attitude. The affirmative agreement ratio of products and services than those of a and non-financial services partners
differs by a factor of 2 to 3 between both traditional bank. • Value Aggregator: through real-time,
dynamically-priced offerings.
The Everyday Bank creates an immersive
FIGURE 8. The Everyday Bank relationship with customers to increase
penetration of purely digital customers
CONSUMER GOODS and cuts digital churn by up to 50 percent.
Through it, banks can:
AS ADVICE PROV
NK IDE TR • Increase the quality of the customer
BA R AN
experience by combining their vast
SP
E
amounts of customer and transaction
M
OR
Renewed Pre-Sale
HO
TA
data with digital capabilities. This
TIO
Branch Role Engagement
N
means providing simple, convenient
services that improve customer’s ability
ANCIAL SER to manage and make better decisions
F IN V
Value on their financial matters. La Caixa, for
RE
IC E
Modern
CO
& EDUCATION
Added example, within its e-banking service
S
and
H E A L T H & PR
ATOR
Personal (Linea Abierta) has developed a service
Relevant
B A NK A S
Banking called Real Time Decision to improve the
Brand
GR E G
Advisor customers’ interaction with La Caixa’s
ve
ow
Home Banking service. The technology
Sa
N
,S rr
OTE C
Bo
AT IO
pe n
AG
d, Tr a n sfer,
AC C
helps consistently make the best possible
RM
TIO
UE
Engaging decisions in real time, automatically
ES
Service
FO
N
L
SF
Digital and using self-learning techniques,
VA
CI
IN
Excellence
L IT AS
A
Interfaces making use of all the information the
AT
O R NK bank has available on the customer. The
TR BA
AV
IO
N bank will offer customers products that
EL T
&L
EIS N ICA match their interests on the basis of
URE MU
COM real-time analysis.
10 | Banking Customer 2020: Rising Expectations Point to the Everyday Bank• Grow sales through continuous daily The Everyday Bank model is the future of the
customer interaction generated across
partnerships and connections with
banking industry. Although the journey to get
provider partners who offer goods and there will be different for every bank, leaders
services in every area of consumption, of the transition will need to determine
from retail and home services to health,
security, travel, leisure, communication answers for four key questions:
and transportation. Based on our
experience, a digital customer interacts • What is our distinct identity as an Everyday Bank?
with providers 12 times more than a • What does our extraordinary customer experience
non-digital customer. More customer look like?
interactions means more opportunities
to better understand customer needs to • What is our digital ecosystem, and how do we
present more relevant offers at the right orchestrate it?
time and place—enough to increase • What is the enabling digital platform?
retention and sell additional products.
• Nurture loyalty to the bank by developing
digital capabilities of relationship
Retail banks should explore approaches that can
managers, empowering them to keep lower risk and cost to serve while accelerating
pace with customer evolutions. A good their timelines.
example is the BankAmeriDeals service
of Bank of America, an innovative and
advanced cash back loyalty program.
This program is free for all online banking
customers and offers discounts on targeted
deals. BankAmeriDeals’ discounts are
focused on customers’ card spending
habits, based especially on previous
purchases made in stores. Customers
pay the full price with their card, then
they receive monthly the discount as a
cash back reward.
• Optimize front- and back-office processes
for speed, efficiency and scalability—
thanks to high automation and
partner integration.
11Contacts To discuss the banking survey results in more detail or how Accenture can help with your digital banking strategy, please contact: Piercarlo Gera Senior Managing Director, Accenture Strategy Banking piercarlo.gera@accenture.com Robert Wollan Senior Managing Director, Accenture Strategy, Sales & Customer Services robert.e.wollan@accenture.com Francesca Caminiti Accenture Research Banking francesca.caminit@accenture.com About Accenture Accenture is a global management consulting, technology services and outsourcing company, with approximately 323,000 people serving clients in more than 120 countries. Combining unparalleled experience, comprehensive capabilities across all industries and business functions, and extensive research on the world’s most successful companies, Accenture collaborates with clients to help them become high-performance businesses and governments. The company generated net revenues of US$30.0 billion for the fiscal year ended Aug. 31, 2014. Its home page is www.accenture.com. Copyright © 2015 Accenture All rights reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture.
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