The biggest challenge facing the financial industry is having a brand promise that matches the customer’s experience. With over 3.1 million Australians expressing dissatisfaction with their major financial institution over the past 12 months it is critical for Australian financial institutions to examine how to address their disengaged and dissatisfied customers. This customer experience versus brand promise problem is known as ‘The Promise Gap’. Service, trust, integrity and accountability are crucial for longevity in customer loyalty.
Generation X, (35 to 54 years old), are the most dissatisfied demographic, which is likely due to their multiple financial commitments, such as mortgages, insurances and bank accounts. A quarter of Australians don’t trust banks to invest their money well, with millennials (20 to 34 years old) and generation X distrusting their financial services more than baby boomers (55 to 70 years old). Furthermore, over two million Australians stated they would be switching to another financial institution within the next six months and 50% would not recommend their financial institution.
While most Australians expressed better interest rates and lower fees as the primary reason for switching to another financial institution, other factors, such as recommendations from friends and professionals, better customer service and larger product offerings also factored into their decision to switch or not to switch.
Word of mouth has always been one of the strongest and highly regarded endorsements an organisation can receive. With half of Australians not wanting to recommend their financial service provider to friends and family, there is a huge opportunity for banks, financial services and insurance companies to review the customer experience, internal training and service and product offerings.
“For us, customer advocacy is a key driver of the ING business and a higher bar than customer satisfaction. The willingness of our customers to recommend ING to family and friends is the ultimate test of whether our products and services are helping our customers get ahead.” Tim Newman, Head of Customer Service & Experience, ING
The three most common reasons cited by Australians as to why they would recommend their financial institution were the ease in which they deal with the customer (36%), good customer service (27%), and good value for services and products (26%). Importantly though 20% ranked the company’s reputation, and another 19% ranked staff as key reasons for recommendation.
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