Table of Contents
Executive Summary
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- Financial services companies have poor reputations for rewarding loyalty
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- Figure 1: Consumer perceptions of how well different firms reward loyalty, December 2015
- Clear prompts and benefits are key to making people switch
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- Figure 2: Switching activity of financial services product holders, December 2015
- Most consumers are ready to accept online-only services
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- Figure 3: Likelihood to switch provider if existing provider moved services online, December 2015
- Face-to-face interaction creates stronger relationships than online channels
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- Figure 4: Attitudes towards loyalty and online services, December 2015
- Shopping around is expected, but consumers are unsure how providers should respond to it
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- Figure 5: Agreement with attitudes towards loyalty in financial services, December 2015
- Loyalty is a confusing concept for consumers to measure
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- Figure 6: Agreement with attitudes towards loyalty in financial services, December 2015
- What we think
Issues and Insights
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- Shopping around is a valued activity, but clear and tangible benefits are needed to make consumers switch
- The facts
- The implications
- Consumers will embrace online service, but the bonds with brands will weaken
- The facts
- The implications
- Consumers are confused about loyalty
- The facts
- The implications
The Consumer – What You Need to Know
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- Financial services companies have poor reputations for rewarding loyalty
- There must be a meaningful benefit to make people switch provider
- Most consumers are ready to accept online-only services
- Face-to-face interaction creates stronger relationships than online channels
- Shopping around is expected, but consumers are unsure how providers should respond to it
- Loyalty is a confusing concept for consumers to measure
Loyalty across Different Industries
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- Financial services are seen as poor at rewarding customer loyalty
- Insurers have the worst reputation for rewarding loyalty
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- Figure 7: Consumer perceptions of how well different firms reward loyalty, December 2015
- There is little perceived difference between banks and building societies
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- Figure 8: Consumer perceptions of how well banks and building societies reward loyalty, by age, December 2015
- Credit card companies perceived as failing those in difficulty
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- Figure 9: Consumer perceptions of how well credit card companies reward loyalty, by current financial situation, December 2015
Switching Activity
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- 43% of current account holders have never switched provider
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- Figure 10: Switching activity of financial services product holders, December 2015
- Prompts are key to switching
- Could savers be missing out?
- There must be a material incentive to switch
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- Figure 11: Switching activity of financial services product holders, by perception of how well providers reward loyalty, December 2015
Influence of Online Services
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- Most consumers would accept a switch to mostly online services
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- Figure 12: Likelihood to switch provider if existing provider moved services online, December 2015
- Older account holders are more likely to stay after an online transition
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- Figure 13: Likelihood to switch current account if existing provider moved services online, by age, December 2015
- Recent switchers are much more likely to change provider
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- Figure 14: Percentage of product owners who would switch provider if existing provider moved services online, by time since they last switched their main product, December 2015
- 18% would switch if documents were online only
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- Figure 15: Choice of services which would make consumers switch providers if they were made online only, December 2015
Attitudes towards Loyalty and Online Services
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- Social media yet to help in building relationships with brands…
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- Figure 16: Attitudes towards loyalty and online services, December 2015
- …but younger consumers are more receptive
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- Figure 17: Agreement with the statement “It is easier to build a relationship with a company that has a strong social media presence”, by age, December 2015
- Online interaction creates more fluid relationships
- Providers must maintain a human element to convince the majority
Attitudes towards Loyalty in Financial Services
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- Most consumers believe people should regularly compare products…
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- Figure 18: Agreement with attitudes towards loyalty in financial services, December 2015
- …but are split on how this should affect the way brands treat them
- A perception persists that new customers get the best deals
Consumer Understanding of Loyalty
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- Loyalty is not a clear-cut concept
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- Figure 19: Agreement with attitudes towards loyalty in financial services, December 2015
- Service is important, but more than price?
Appendix – Data Sources, Abbreviations and Supporting Information
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- Abbreviations
- Consumer research methodology
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