Banks’ traditional role is changing as customers expect more of their financial service providers than just products, with the companies able to respond to those changes best prepared for the future; new research sheds light on that dynamic.

This is according to Kantar’s first retail banking customer experience index, titled the CX+ report.

“CX+ identifies the causal relationship between the way your brand is experienced and your financial performance,” writes Barbara Cador, CX+ Global Lead, and Amy Cashman, Co-CEO, Insights Division, UK, both at Kantar.

They go on to indicate why experience is now far more than a marketing consideration but should be a concern at an organisation’s highest levels. “Turbocharging shareholder returns is also going to become increasingly reliant on how you view and manage customer experience, and so customer experience must be one of your key priorities.”

Based on a survey of almost 8,700 retail banking customers, the report seeks to measure “the gap between the promise banks make to their customers and the actual brand experience they receive.”

Respondents were asked about their experiences with the bank or banks they use, and about their perceptions of banks they are considering but not currently using. To calculate the score, Kantar combined two main measures:

  • The mean CX Performance score across five key success factors; clear brand purpose, empowered employees, empowered customers, lasting memories and exceptional delivery.
  • The Experience Gap defined as the gap between the brand promise and the actual customer experience delivery.

With CX+ scores of 134 and 119 respectively (with an average score of 100), the two leading banks – First Direct and Nationwide – have a significant lead over the other eight banks in the ranking. Barclays (100) comes in third, followed by The Co-Operative Bank (97) in fourth and HSBC (97) in fifth place.

The research comes amid the surging fortunes of new financial challenger banks, also known as fintechs, that are digitally native and whose main offer to their users is experience. However, the fact that among key millennial (25-34) audiences, 47% have said they hold two accounts, suggest that banks continue to enjoy a trust factor (and/or feel inertia) toward traditional banking.

But the research paints a rich portrait of future disruption. The following observations are key:

  • Growing brands are innovative brands: Innovation no longer means simple new product development as much as it means rethinking the business from the direction of what the customer needs to do.

    For some of the most successful challengers, and indeed some traditional banks, that means helping customers to meet financial goals by rendering a service rather than simply selling them products.
  • Customers are at the heart of CX strategy: As such, only the laziest interpretations of this idea will focus entirely on technology; some of the most effective changes can be made in the way in which advice and support are offered, perhaps with changes to the way in which employees’ performance is measured.

    Having said that, a solid multi-channel experience will be increasingly important: “The future will be mobile first but not mobile only. Maintaining a human connection across all touchpoints will remain important to all generations.” Over a third (38%) of all consumers and almost half (49%) of millennials expect their banks to go beyond products and to offer support.
  • History only counts for so much: “Brands need to accept that what has sustained them in the past, is unlikely to keep them growing in the future”, says Tim Pritchard, Managing Director of Customer Experience at Kantar.

    “Barriers to entry are falling all the time and those that aren’t disruptors themselves will be disrupted. The imperative for brands is as simple and as difficult as one clarifying idea – put the customer first by focusing on the customer experience. This is after all what makes or breaks a brand.”

Some of the themes here present themes present in WARC’s Marketer’s Toolkit 2020, notably the convergence of brand and experience at the centre of the marketing conversation. Kantar’s research is a useful opening salvo to the measurement of CX programmes’ effectiveness in the coming year. Understanding their impact will be key.

Sourced from Kantar, WARC