HSBC’s online banking subsidiary
first direct has topped the 2011 UK Retail Banking Satisfaction
Study by marketing consultancy JD Power.
The score of first direct was 774
(out of a possible 1,000), followed by The Co-operative Bank with
Nationwide Building Society ranks
third with a 723 score.
The top three ranked lenders remain
unchanged from last years survey.
Head of customer services at first
direct, Jason Sharpe, told RBI that the lender’s
performance has been consistent over the years.
“We are one of the top 100 core
brands in the UK and for a bank to be a core brand I think it is
brilliant, and bizarre as well especially in this sort of climate,”
The JD Power Retail Banking
Satisfaction Study revealed that retail customers are happier with
the service they receive now than they were a year ago.
Overall satisfaction among retail
banking customers has nudged up to 698 on the 1,000-point scale
(2010: 683) in the study, with the branch facility factor helping
to drive the improvement.
The JD Power study factors in six
parameters for banks – problem resolution, account activities,
fees, product offerings, account information and branch
Satisfaction remained relatively
low in 2010 for three key areas: fees, product offerings and
problem resolution, according to the JD Power Study.
Approximately 55% of customers who
have had a problem or made a complaint in the past year said they
are disappointed with the resolution process.
JD Power’s director of the services
and emerging industries division, Stuart Crawford-Browne, said:
“It appears that banks have taken
action to improve the customer experience, and this effort has paid
“Retail banking customers tend to
be especially dissatisfied with overdraft fees and monthly service
charges, particularly the amount of these fees.
“It is important for banks to
clearly articulate the value customers receive through the
benefits, services and features of their banking relationship as a
way to mitigate some of the negative sentiment caused by a monthly
service fee or overdraft fee.”
The study also finds that while
incentives are important in attracting new customers, customer
service is key to retention.
Fifteen percent of customers say
that they selected a particular bank because of an incentive, such
as a promotional gift or cash award.
However, nearly 40% of customers
left their bank because of a poor service experience, and an
additional 43% cite poor service as a top reason for intending to
leave their bank.
“While incentives have the
short-term benefits of attracting business, that business can go
out the back door just as quickly as it comes through the front
door if banks aren’t delivering a solid customer experience,” said
“Relying on incentives only works
if customers are highly satisfied. Banks can reap the benefits of
high recommendation and retention rates when customers are
satisfied with the service they receive.”
Bringing up the rear in the survey
was National Australia Bank subsidiary Clydesdale Bank.
Clydesdale has consistently fared
disappointingly in the JD Power survey, ranking third-last in 2010,
only ahead of sister-brand Yorkshire and Santander.
Steve Reid, retail director,
Clydesdale Bank told RBI: “We take all feedback seriously
and have a continual focus on customer satisfaction as part of our
strong support for customers.
“Customer focus is at the very
heart of what we do. Through our Customer Promise we are committed
to getting it right for customers and creating a distinctive
“This means we are always on the
look out for new and better ways to improve our business and make
our customers’ lives easier.
“It is disappointing to learn of
instances where customers are unhappy with our service. However,
our own independently validated analysis of almost 2,500 customers
consistently places us ahead of market average.
“This demonstrates our ongoing
commitment to providing the best possible customer service.
“In fact, our most recent customer
analysis found that almost 98% of our customers rated the service
they received from us as either good or very good.
“In addition more than four out of
five of our customers said they would be very likely or likely to
recommend us to their family.”
The biggest fallers compared with
last year are Royal Bank of Scotland (RBS) – down from 4th last
year to 9th this year and Lloyds’ subsidiary Bank of Scotland, down
from 8th place in 2010 to 11th of the 13 brands surveyed this
RBS’ England-based retail
subsidiary moved in the opposite direction, from 10th to 5th.
The 2011 UK Retail Banking
Satisfaction Study is based on responses from 3,899 customers
of banks throughout the UK.
The study was fielded in September and October 2011.