Winning through customer experience - ey.com

1 Winning through customer experienceEY Global consumer Banking Survey 2014 ContentsWelcomeExecutive summaryGlobal insights A promising, active environment The power of trust The experience is what matters Key opportunities for banksSegment insights Getting to know your customer segments Industry and institutional sentiments Opportunities for segment-driven investmentsWhy banks need to act nowConclusionResearch methodologyCountry contacts12620 34404244 WelcomeWhen EY s second global consumer banking survey was published in June 2012, the global ][gfgeq oYk kljm__daf_ lg j][gn]j Yf\ [gfkme]j [gf \]f[] af l`] af\mkljq j]eYaf]\ ]plj]e]dq dgo$ hYjla[mdYjdq af l`gk] [gmflja]k ZY\dq Y^^][l]\ Zq l`] _dgZYd fYf[aYd [jakak Yf\ alk Y^l]jeYl`&Fast forward to this new edition of our survey and the outlook for retail banking appears more hgkalan]& 9dl`gm_` kge] ][gfgea]k kladd kljm__d] lg \]dan]j kmklYafYZd] _jgol`$ l`] _dgZYd ][gfgea[ j][gn]jq Yhh]Yjk lg Z] lYcaf_ `gd\&.

2 Gfkme]j [gf \]f[] af l`] ZYfcaf_ af\mkljq ak gf l`] jak]$ Yk ak ljmkl af af\ana\mYd afklalmlagfk$ Yf\ [mklge]jk Yj] ZjgY\dq kYlak ]\ oal` l`]aj hjaeYjq ZYfcaf_ j]dYlagfk`ahk&However, the primacy of the bank s relationship with its customers is under threat as never Z]^gj]& <]eYf\k Yf\ ]ph][lYlagfk [gflafm] lg ]ngdn]$ g^l]f ^m]d]\ Zq ]ph]ja]f[]k gmlka\] fYf[aYd k]jna[]k$ Yf\ [gfkme]jk Yj] af[j]Ykaf_dq dac]dq lg \]n]dgh j]dYlagfk`ahk oal` emdlahd] hjgna\]jk& =e]j_af_ l][`fgdg_q$ Yf\ l`] af[j]Ykaf_ mk] g^ egZad] \]na[]k ^gj Zgl` ZYfcaf_ Yf\ payments, is making it easier for new entrants to challenge the status quo and exploit areas of \akkYlak^Y[lagf Yf\ mf\]jafn]kle]fl&This year s survey includes responses from more than 32,000 retail banking customers across 43 countries and, although retail banking remains a local business, it is striking how many hYjYdd]dk o] [Yf \jYo Y[jgkk eYjc]lk& Af l`ak ]\alagf g^ l`] kmjn]q$ o] ^g[mk gf l`] ^gddgoaf_ key questions.

3 What is the role of trust in creating customer advocates, and how valuable is trust to the overall banking relationship? Are banks investing in the right aspects of the customer experience ? How well are banks performing on key interactions from the basics of day-to-day transactions, lg j]kgdnaf_ hjgZd]ek Yf\ `]dhaf_ [mklge]jk Y[`a]n] l`]aj fYf[aYd _gYdk7 How similar are customer behaviors across the globe? How well are banks prepared to fend off potential new market entrants?>gj l`] jkl lae]$ o] n] \]n]dgh]\ ]a_`l _dgZYd k]_e]flk lg hgjljYq k`a^laf_ [gfkme]j k]flae]fl$ g^l]f ajj]kh][lan] g^ _]g_jYh`q& O] ogmd\ o]d[ge] l`] ghhgjlmfalq lg e]]l oal` qgm Yf\ hjgna\] [mklgear]\ f\af_k lg \]dan]j Y\\alagfYd afka_`l$ Yf\ o] n] hjgna\]\ Y dakl g^ [gmfljq [gflY[lk Yl l`] ]f\ g^ l`ak j]hgjl& Hd]Yk] nakal mk Yl ooo&]q&[ge'_dgZYd[gfkme]jZYfcaf_kmjn]q ^gj egj] af^gjeYlagf$ af[dm\af_ l`] YZadalq lg Y[[]kk Y\\alagfYd kmjn]q \YlY Yl qgmj [gfn]fa]f[]

4 & Bill Schlich Global Banking & Capital Markets Leader1 Winning through customer experienceExecutive summary ;gf \]f[] af l`] ZYfcaf_ af\mkljq ak gf l`] jak]$ Yf\ ljmkl af [mklge]jk gof fYf[aYd k]jna[]k hjgna\]jk ak `a_`& :ml [mklge]jk Yj] gf l`] egn]$ oal` mfhj][]\]fl]\ Y[[]kk lg [geh]laf_ ZYfck Yf\ lg f]o lqh]k g^ fYf[aYd k]jna[]k hjgna\]jk& :Yfck emkl ]Yjf l`] highest levels of trust in order to j]lYaf [mklge]jk$ oaf egj] Zmkaf]kk Yf\ [j]Yl] _]fmaf] dgqYdlq&The banking industry is poised for growth;gf \]f[] af l`] ZYfcaf_ af\mkljq ak j]lmjfaf_$ oal` ++ g^ [mklge]jk _Yafaf_ [gf \]f[] af l`] hYkl )* egfl`k Yf\ gfdq )1 dgkaf_ [gf \]f[]$ [gehYj]\ oal` Y ,( \][daf] af gmj dYkl kmjn]q& O`ad] em[` of the improvement may simply be a restoration of [gf \]f[] dgkl af l`] oYc] g^ l`] ?

5 DgZYd >afYf[aYd Crisis, this improved sentiment can only help fYf[aYd afklalmlagfk Yk l`]q ogjc lg kgda\a^q Yf\ ]phYf\ j]dYlagfk`ahk oal` l`]aj [mklge]jk& L`]j] ak ka_fa [Yfl Zmkaf]kk ghhgjlmfalq Ykkg[aYl]\ with customers who are true advocates, those who are very likely to recommend their primary fYf[aYd k]jna[]k hjgna\]j H>KH!& Kh][a [Yddq$ ,, of advocates opened new accounts or services at l`]aj H>KH af l`] hYkl )* egfl`k Yf\ 1 afl]f\ lg [gfkgda\Yl] ]n]jql`af_ Yl l`]aj H>KH af l`] f]pl q]Yj& Kaf[] 0- g^ kmjn]q j]khgf\]flk \] f]\ l`]aj H>KH Yk Y ZYfc$ al ak Yf ghhgjlmf] lae] ^gj ZYfck to increase advocacy and expand their customer j]dYlagfk`ahk&An improved experience is key to realizing that growthCustomers generally trust their primary providers, but the highest level of trust is a clear differentiator in creating advocacy, and customer experience ak Y c]q \jan]j g^ l`Yl d]n]d g^ ljmkl& O`ad] gn]jYdd fYf[aYd klYZadalq oYk l`] lgh j]Ykgf ^gj [mklge]

6 Jk [gehd]l] ljmkl af l`]aj H>KH$ l`] k][gf\ egkl cited response was the way I am treated, followed closely by other elements of the experience , such as communications, quality of advice and complaint `Yf\daf_&Moreover, the most common reason customers cited for opening or closing accounts in the past q]Yj oYk l`] ]ph]ja]f[] oal` l`]aj fYf[aYd k]jna[]k hjgna\]jk$ ]\_af_ gml jYl]k'^]]k Yf\ [gfn]fa]f[] Yf\ kmjhYkkaf_ ZjYf[` dg[Ylagfk Yf\ Y[[]kkaZadalq&So the experience drives not only complete trust, and thus advocacy and referrals, but also the amount of business customers are placing with their H>KH& Mf\]jklYf\af_ l`] aehgjlYf[] g^$ Yf\ l`]aj h]j^gjeYf[] gf$ kh][a [ Ykh][lk g^ l`] ]ph]ja]f[] oadd Yddgo fYf[aYd afklalmlagfk lg eYc] lYj_]l]\ afn]kle]flk&2ooo&]q&[ge'_dgZYd[gfkme]jZY fcaf_kmjn]qO`ad] [mklge]jk Yj] egkl dac]dq lg hjYak] l`]aj H>KH ^gj convenience and security, those have quickly become eafaeme j]imaj]e]flk& Em[` g^ l`] ]eh`Ykak oal`af \]n]dgh]\ [gmflja]k `Yk Z]]

7 F gf aehjgnaf_ ljYfkY[lagfk& Dac] 9 LEk af l`] 0(k Yf\$ egj] j][]fldq$ gfdaf] banking, mobile banking was viewed initially as a point g^ \a^^]j]flaYlagf Yegf_ l`gk] fYf[aYd afklalmlagfk g^^]jaf_ al& @go]n]j$ fgo al ak ]ph][l]\$ Ydgf_ oal` l`] YZadalq lg egn] k]Yed]kkdq Y[jgkk [`Yff]dk& L`] fYf[aYd landscape is different in emerging markets, but no less [`Ydd]f_af_& L`] afl]_jYlagf g^ l][`fgdg_q$ ]kh][aYddq egZad]$ `Yk afljg\m[]\ hjgna\]jk lg Yf af mp g^ f]o [mklge]jk k]]caf_ ZYka[ fYf[aYd k]jna[]k&When asked to evaluate 31 experience elements or Z]f] lk kmjn]q j]khgfk]k hgafl]\ lg k`gjl^Yddk af meeting basic expectations, such as transparency of fees and communication, and the continued importance g^ ]^^][lan] hjgZd]e `Yf\daf_& Af Y\\alagf$ l`] j]kmdlk hjgna\]\ afka_`l aflg ghhgjlmfala]k ^gj H>KHk lg differentiate themselves by customizing products and solutions to meet customers needs and helping them Y[`a]n] l`]aj fYf[aYd _gYdk&Key improvement areas for banksTransparency of fees and simplicity of offers and communication.)

8 This is one of the most kgm_`l%Y^l]j Z]f] lk f]]\af_ aehjgn]e]fl& ;mklge]jk oYfl fYf[aYd afklalmlagfk lg Z] [d]Yj]j YZgml o`Yl l`]q g^^]j$ l`] ^]]k l`]q j] [`Yj_af_ Yf\ `go lg Ynga\ hYqaf_ ^]]k&Omni-channel experience . ;mklge]jk Yj] kYlak ]\ oal` l`] [gfn]fa]f[] g^ ljY\alagfYd banking but expectations are constantly rising as new technologies and consumer behaviors \]n]dgh& Af[j]Ykaf_dq$ [mklge]j Z]`Ynagj ak [`Yf_af_ lg afngdn] o]Z$ egZad]$ kg[aYd e]\aY Yf\ af%h]jkgf afl]jY[lagfk ^gj Y kaf_d] hmj[`Yk]& Lg klYq [geh]lalan]$ fYf[aYd afklalmlagfk f]]\ lg [gflafm] Zmad\af_ gml [`Yff]d [YhYZadala]k lg hjgna\] *,'/ j]Yd%lae] Y[[]kk lg ZYfcaf_$ k]Yed]kkdq$ Y[jgkk [`Yff]dk& More and better advice.

9 Customers tell us they are willing to increase their accounts and ZYdYf[]k af ]p[`Yf_] ^gj ZYfck `]dhaf_ l`]e \]n]dgh l`]aj fYf[aYd hdYfk Yf\ _gYdk demonstrating the power of personalizing the experience and creating a mutual exchange g^ nYdm]& L`mk$ ZYfck f]]\ lg hjgna\] Y\na[] l`Yl ak [mklge]j%[]flja[$ ZYk]\ gf Y `gdakla[ h]jkh][lan] g^ l`] [mklge]j k mfaim] kalmYlagf Yf\ f]]\k& =imahhaf_ Y\nakgjk oal` l`] ja_`l kcadd k]lk$ af[]flan] kljm[lmj]k Yf\ f]logjc g^ kh][aYdaklk3 hgkalagfaf_ l`] ZjYf[` Yk Y kYd]k'Y\na[] []fl]j l`Yl hjgna\]k h]jkgfYdar]\ YkkaklYf[]3 Yf\ j]\] faf_ l`] jgd] g^ l`] [Ydd []fl]j Yk Y naYZd] [`Yff]d ^gj hjgna\af_ Y\na[] Yj] Ydd kljYl]_a]k l`Yl k`gmd\ Z] ]phdgj]\&Greater use of data and digital channels to empower customers.

10 Banks have access to vast data sets, both in-house and externally available, that they should leverage to h]jkgfY