LONDON (3/7/11)--Despite efforts by banks to woo back consumer confidence from the financial industry crisis, 44% of retail banking customers around the world said their trust in the banking industry decreased in the past 12 months. For the U.S., customer confidence levels were lower: 55% of customers surveyed by Ernst & Young said they have less confidence than a year ago. The company conducted a global survey of 20,500 retail banking customers to gauge what drives their relationship with banks. Credit unions, while not part of the study, will note the report advises banks that the keys to success will be brand management, personalized services and efficient pricing--something credit unions already do. Levels of confidence are lower in regions hard hit by the economy, such as the U.S., the report said. The United Kingdom had the largest drop in confidence (63%). "In developed markets, customer confidence and trust in financial institutions has been severely damaged by the economic crisis, and our findings show that it remains under threat," said Pierre Pilorge, Ernst & Young's financial services customer leader. "Emerging market economies suffered less from the credit crisis and recession and so their banks have seen trust endure. In order to get back on track the survey clearly illustrates that banks in developed nations must rebuild customer confidence, enhance the customer experience and stem customer attrition." Other findings:
* Macroeconomic factors had the most negative impact (53%) on customer confidence. Brand strength was cited as a key factor driving customer satisfaction worldwide. * Attrition levels are highest in Europe, with 39% having switched banks in the past. Leading factors in the switch were service quality (48%) and price (43%). Also cited were product offerings, branch proximity and lack of trust. * Finding a way to effectively deliver a personal service to customers will be a key success factor in the years ahead. While internet banking (83%), ATMs (79%), and branches (79%) are touch-points customers are most satisfied with today, satisfaction with call centers in consistently weaker (44%). * Banks need to reconnect with their customer base by improving the customer experience across their operations. Some are experimenting with new tools such as mobile banking, but there is demand across all channels--including call centers and branches--for greater personalization and attentiveness.
"The banking industry in developed markets has witnessed a significant shift in confidence, and never before have loyalty and personal customer attention been such critical issues," said Ernst & Young. "Customers are demanding more personalized service if they are to remain loyal. The successful institutions of the future will be those who offer customer-focused innovative services. Those that do will be able to differentiate their organization and drive for growth," Pilorge said. The Ernst & Young report is entitled A New Era of Customer Expectation