Benchmark Report February 2020

FINANCIAL SERVICESCUSTOMER SATISFACTION IN

The latest research from TTi Global, a division of

GP Strategies (TTi) , shows that customer satisfaction fell

with banking and insurance providers during the three

months to October 2019, with satisfaction ratings

decreasing from 7.73 to 7.65. (See figure 1)

Data also shows customer effort increased from 5.74

to 5.84 ? although this remains below the cross sector

mean customer effort score of 5.89. (See figure 2)

Customer recommendation and re-purchase intention also

declined. (See figures 3 and 4)

The top driver of customer satisfaction in banking is

?managing my current account? (9.0), while the biggest

cause of dissatisfaction is ?resolving current account

problems.? (6.49) (See figure 7)

The top driver of customer satisfaction in insurance is

?phone call management? (9.30) while the lowest is

?discussing the value of my premium? (5.65).

(See figure 10)

TTi?s latest benchmarking data shows

declining customer satisfaction and

loyalty with UK bank and insurance

companies.

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Overall customer satisfaction scores

Overall customer satisfaction in the Banking and Insurance

sector fell slightly from 7.73 to 7.65 during the three months

to October 2019. The sector was previously performing closer

to the mean UK satisfaction rating of 7.72 across the 14

sectors featured.

Our results show that customer expectations of banking and

insurance services are changing. To get ahead, organisations

need to keep pace with changing requirements to ensure

they deliver services which fulfill customers? needs.

The positive news is that the change in customer feeling is

not significant (less than 1.0) and can be adjusted by making

small but impactful improvements to core customer

processes and staff training to ensure a consistent customer

experience.

Figure 1 - Overall mean customer satisfaction scores across all sectors

Comparing all

sectors

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Overall customer effort

Along with declining customer satisfaction, our results reveal

that the amount of effort banking and insurance customers are

having to exert to achieve their desired outcome also

increased, rising from 5.74 to 5.84. Despite this rise, the

sector?s rating overall still sits below the mean UK customer

effort score (5.89) and is only marginally higher than

Supermarkets (5.77) and Retail (5.74), renowned for crafting

low-effort experiences.

Creating a fast, frictionless customer experience is highly

desirable and key for generating customer loyalty. While many

banking and insurance companies have introduced online chat

and self-service transactions to support this, customers still

expect to be able to speak to a customer agent quickly if they

encounter a problem or want to swap from online to real-life

interaction.

Figure 2 - Overall mean customer effort across all sectors

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Would you recommend this company to

a friend?

Increasing customer effort not only decreases customer

satisfaction but also makes customers less likely to recommend

an organisation to other people.

This trend plays out in our results which show a drop in

banking and insurance company customer recommendation

ratings from 7.52 to 7.44. It also takes its recommendation

score below the overall sector mean of 7.67.

The sector with the highest recommendation rating is Online

Retail (8.70) indicating consumers approval and advocacy for

companies providing a convenient, Amazon-like buying

experience.

Figure 3 - Overall mean customer recommendation across all sectors

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How likely are customers to repurchase?

Another key metric impacted by high effort and low

satisfaction is a customer?s propensity to reuse or repurchase

from an organisation again. This is one of the most significant

indicators of company health, as organisations generate critical

revenue from return customers.

The drop in satisfaction and increase in effort is reflected in our

repurchase results, which shows customers likeliness to reuse

their bank and insurance providers fall from 7.78 to 7.67.

Figure 4 - Overall mean customer repurchase scores across all sectors

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Customers' satisfaction with UK banks

Our benchmarking results reveal customer satisfaction, loyalty

and recommendation is influenced by many different service

features.

The main attribute driving high levels of customer satisfaction

and low customer effort ratings is ?managing my current

account?. (See figure 7)

Figure 5 below demonstrates the influence of customer effort

on other key customer metrics. Lower customer effort rating in

month 12 corresponds with an increase in customer

satisfaction, loyalty and recommendation ratings.

UK Banks

Customer

Satisfaction

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Figure 5 - Comparison of Customer Satisfaction Metrics in UK Banks

Real customer comments

Customers? positive comments about their bank?s customer

service interactions include:

- ?Friendly and very informative staff with a very smooth

transaction, like I have been talking to a friend.?

- ?A reliable service and staff that know what they are

talking about. That they listen to customers and answer

my questions rather than going from a script.?

One area that organisations struggle with across all sectors is

improving call centre waiting times. While many have

introduced IVR (Interactive Voice Response) technology to

reduce costs and waiting times, customers recognise that IVR

is essentially a queue management system rather than a fix for

shortening hold times.

Customer comments relating to their banking and insurance

providers? IVR included frustrations such as:

- 'No menu?

- Wanting it to be ?easier to contact provider by telephone?

- Desiring a ?shorter wait time?

When asked what their ideal customer service would look like,

banking and insurance customers comments included:

- ?Immediate contact on the phone rather than pressing a

dozen buttons?

- ?Easy and quick to contact?

- ?Operator is quick to understand problem and solution

offered fixed first time?

Further research into call centre customer journeys and the

steps they need to take to complete actions will reveal the root

cause of customers? pain points.

Sentiment

Analysis

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Customer effort with banking providers

Our data shows that the best performing banks in relation to

customer effort ? the ease with which customers can fulfill

relevant tasks - are:

- First Direct ? achieved the lowest customer effort score

of 2.67

- Nationwide ? previous low rating of 3.36 and current

rating of 3.98

As mentioned above, long call waiting times exacerbate

customer effort which impacts the customer experience.

Data in Figure 6 shows the length of time customers are on

hold or in a queuing system and its influence on other

customer metrics. Being on hold is seen by customers as a

high effort activity which in turn impacts customer satisfaction,

re-purchase and recommendation scores. Monitoring

customer effort ratings at touchpoints on the customer

journey will pinpoint where ?effort stressors? occur, enabling

effective action.

Figure 6 - Customer Phone Hold Time Metrics

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What makes banking customers happy?

The top driver of customer satisfaction in banking is ?managing

my current account? (9.0).

?Switching bank accounts? occupies a middle ground with a

rating of 7.65. Customer satisfaction with switching accounts

increased only slightly in the past six months from 7.09 to 7.65,

indicating there is currently little differentiation between banks

approach to this service.

As switching, opening and closing a bank account typically follows

a set process, our research suggests that getting this right and

making these processes as simple and stress-free as possible for

customers can set new ground for creating stronger customer

loyalty and recommendation.

?Resolving current account problems? received the lowest

satisfaction score of 6.49.

Figure 7 - Drivers of Customer Satisfaction with UK Banking Providers

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What drives customer effort in banking?

The bank service customers see as requiring the least customer

effort is ?managing my current account? (3.0).

?Switching bank accounts? is perceived as neither a high or low

effort transaction (5.35).

The service customers perceive as needing the most effort is

?resolving current account problems? (7.82). Banks keen to

reduce customer churn should ideally explore and focus

resources on resolving customer issues quickly and effectively

the first time.

Figure 8 - Drivers of Customer Effort with UK Banking Providers

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Customer satisfaction in UK Insurance

Our data reveals customer satisfaction with individual

insurance providers. Highest performing insurers are:

- Direct Line ? awarded high customer ratings of between

9.25 and 9.50 in the last six months

- Churchill ? previous high customer ratings of 8.71, plus

has a current high rating of 8.18

- Admiral Insurance ? previous high customer rating of

8.40, plus a current high rating of 7.79

Factors delivering highest customer satisfaction ratings are

?phone call management? (9.30) and ?staff knowledge? (8.55).

UK Insurance

Customer

Satisfaction

Figure 9 - Customer Satisfaction with UK Insurance Providers

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What drives customer satisfaction in

insurance?

The leading driver of customer satisfaction for insurance

customers is ?phone call management? (9.30).

The lowest performing area for insurance is ?discussing the

value of my premium? (5.65).

Customer preference is for insurers to be transparent and

provide their best quotation on first contact. Respondents?

comments within our survey indicate customer loyalty is being

diminished by this approach and missing their basic

expectations of openness and trust. Brand perception research

will help define what values and practices resonate best with

customers, improving uptake.

Figure 10 - UK Insurance: Drivers of Customer Satisfaction with UK Insurance Providers

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Improving Customer Satisfaction in

Banking and Insurance

Providing a great customer experience (CX) is crucial for all

companies, but particularly for organisations in the fiercely

competitive financial sector.

Today?s customers have extensive choice of banks, building

societies and insurance companies, each offering enticing

perks from cash bonuses for switching to 24/7 customer

service. While insurance companies have had an online

presence for a while, challenger online banks are starting to

make headway as people increasingly use mobile and online

banking. Comparison sites are also making it easier and more

convenient for customers to scout out deals and switch

providers. To get ahead, delivering exceptional end to end

customer service is critical to retain and attract customers.

As our benchmark survey shows, metrics such as customer

satisfaction, customer effort and loyalty constantly fluctuate

in line with customer feeling and it only takes a few poor

interactions for a customer to take their business elsewhere.

59% of customers will walk away after several bad

experiences, while 17% will walk away after just one.

pwc.com/future-of-cx

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To remain competitive, generate profit and differentiate from

competitor services, financial organisations must start filling

the gaps between what customers expect and the service

reality.

Here are five key strategies to start

developing a great customer experience:

Acquire customer feedback across all touchpoints and

channels

Whether applying for a banking or insurance product or

service online, having a one-to-one meeting or using a

mobile banking or insurance app, each interaction presents

an opportunity to delight customers or turn them off. The

first step to improving customer experience is finding out

what customers want at defining touchpoints on each

customer journey.

Implementing a regular, tailored customer satisfaction survey

(CSAT survey), such as our Customer Experience Quality

Analysis framework enables organisations to gain feedback

at touchpoints across multiple digital and non-digital

channels. As well as isolating what customers want at each

interaction, it gives actionable insight into what

improvements are needed to align the experience with

customer expectations.

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Reduce customer effort

Our survey shows that making customers work hard to

complete tasks diminishes customer satisfaction and loyalty.

It also reduces the chances of a customer using you again

and speaking favourably about you to other people in person

and on social media.

Although banking and insurance organisations are working

hard to streamline common customer journeys with

self-service automation, our survey identified customer effort

is raised around resolving current account issues and call

centre wait ing t imes.

Ensuring tasks take minimum effort and gives the agile

functionality today?s customers expect is key for raising

satisfaction and reducing dropout rates. To identify

touchpoints which exert customer effort, ensure your

customer satisfaction survey incorporates Customer Effort

Scores (CES). This will flag which touchpoints are ?effort

stressors? and the remedial action needed, whether that lies

in providing more self-service tools (preventing the need to

call), or extra training to strengthen teams? ability to solve

problems first-time.

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Gather real-t ime customer insights

Conducting ad-hoc satisfaction surveys won?t yield adequate

results to transform customer satisfaction. Kickstarting

meaningful changes in customer satisfaction, which can be

tracked and measured over time, requires a continuous flow

of accurate, timely customer data.

CEQA provides key baseline indicators of customer

satisfaction which in turn can be used to develop a

comprehensive Customer Satisfaction Index.

The system integrates with existing dashboards, enabling

banking and insurance managers to track and respond to

customer satisfaction performance in real-time. As well as

providing a holistic customer experience measurement, it can

track interactions with individual departments and functions,

such as customer onboarding or claims filing or processing,

allowing companies to make targeted improvements to

customer-facing processes.

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Make employee engagement part of your customer

experience strategy

High employee engagement has a positive influence on

customer satisfaction, with Forbes calling employee

engagement the ?wonder drug for customer satisfaction?.

Our research work continually highlights how employee

engagement - the extent to which an employee cares about

and is emotionally invested in a company and its

organisational goals ? impacts customer satisfaction.

Evidence shows that engaged employees who feel connected

and valued by their employer are much more likely to bring

their A-game to their role, leading to happier customers and

higher retention.

Introducing a custom employee engagement survey is the

first step to identify baseline staff engagement levels and

focus areas. Uncovering the desired attributes that staff want

? whether it lies in flexible working, greater responsibility or

training and development opportunities ? will support

effective employee engagement strategy planning and

implementation. Running a staff survey programme in

tandem with a customer satisfaction survey will provide solid

evidence of what is working and enable informed decision

making around where to channel resources for best results.

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Start competit ive benchmarking

Digitisation is the future for banking and insurance and many

organisations are already using disruptive technologies to

smooth customer journeys, from mobile apps to quick-fire

chatbots. Also capitalising on latest technology are

mobile-only challenger banks (neobanks) and insurance

companies offering customers convenient 100% digital

services. With digital customer service evolving rapidly, being

?out innovated? presents a risk for both traditional and

challenger banking and insurance business models. An

effective way to evaluate your performance against

competitors is via competitive benchmarking research.

We?ve been conducting competitor research and analysis for

financial services and other sectors for over thirty years.

Alongside evidence of where an organisation sits in relation

to its closest competitors, our solution identifies:

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- What competitor companies do well and where

satisfaction drops away, enabling opportunities to

differentiate on customer experience and provide

valuable service characteristics customers want

- How customer service compares on a broad and

granular level, from contrasting overall performance

to individual banking and insurance products and

processes, allowing continuous improvement

- What customer service technology and pathways

competitors are using, supporting evidence-based

decisions around the best AI and digital solutions

to choose (or not) for crafting an effective

omni-channel experience.

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Ready to improve your customer experience?

To find out more about our customer, employee and

competitor research solutions, contact TTi Global Research.

About our Customer Satisfaction Benchmark Survey

The latest UK Satisfaction Benchmark Survey from

TTi Global Research, a division of GP Strategies, delivers unique

insight into the quality of customer service in Financial Services

along with 13 other sectors. Rolling data was derived from an

online survey of over 7,100 UK respondents, including 800 banking

and insurance customers, and was conducted over three months

between August and October 2019.

Author

Glyn Luckett

Commercial Director TTi Global Research

Get in touch:

gluckett@gpstrategies.com

www.tti-global-research.co.uk

© 2020 TTi Global. All rights reserved. TTi Global Research, sometimes referred to as TTi Global or TTi Research is a division of GP Strategies. This content is for general information purposes only, and should not be used as a substitute for consultation with professional advisors. TTi Global has exercised reasonable care in the collecting, processing, and reporting of this information but has not independently verified, validated, or audited the data to verify the accuracy or completeness of the information.