Average retail banking customer profitability
remains below pre-crisis levels, while customers’ price-sensitivity
and inclination to ‘shop around’ have increased, according to a
report from the consultants Accenture.
Almost half of the bank executives surveyed by
Accenture (46%) have seen their average customer profitability
decline by 5% to 15% since the financial crisis.
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An additional 11% have seen even greater
customer profitability declines.
Customer loyalty rates dropped for 59% of the
banks surveyed, with 63% reporting that customers have become more
price-sensitive and are actively seeking out other institutions for
products and services.
More than two-thirds (68%) of respondents said
they expect such independent consumer banking behaviours, which
have emerged or accelerated from the crisis, to continue long
term.
“Our research shows a fundamental power shift
between the banks and their customers since the financial crisis
began,” Noel Gordon, global managing director of Accenture’s
banking industry practice and co-author of the research, said in a
statement.
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By GlobalDataConsumers have come out of the crisis “more
skeptical” of their bank’s brand and are more apt to move away from
banks with poor service, he said.
According to the executives, the primary
strategies that banks are employing to boost customer revenues are
increased cross-selling to existing customers (87%), the pursuit of
new customers (54%) and increasing prices for their products and
services (33%).
An increased demand for “direct” services –
online, telephone, and mobile – was identified by 83% of those
interviewed, with 63% stating that meeting those demands will be a
major challenge for their firms in the next three years.
