Table of Contents
Executive Summary
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- The issues
- Nearly seven in ten Canadians have a ‘big five’ as their main bank
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- Figure 1: Choice of main FI, August 2016
- While TD is still on top, Tangerine emerges as a strong alternative choice
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- Figure 2: Switching choice of main FI, August 2016
- Value for money, branches, product selection and ABMs are dominant influencers
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- Figure 3: Switching influencers (top five), August 2016
- Preferred rates, discounts, rewards and cash incentives appeal to nearly half of consumers
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- Figure 4: Interest in cross-sell incentives, August 2016
- Younger consumers and Asian Canadians are more inclined to switch their main FI
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- Figure 5: Attitudes related to satisfaction, August 2016
- The opportunities
- Influencing switching decisions by harnessing the power of recommendations
- Building loyalty through branch relationships
- Understanding factor preferences that influence customer switching
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- Figure 6: Top-five rank of factors influencing switching, by age, August 2016
- What it means
The Market – What You Need to Know
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- Canada’s population is expected to age in the coming years
- The population is growing and becoming more ethnically diverse
- Women outnumber men in Canada
- Growth of the LGBT community
Market Factors
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- Canada’s population is expected to age in the coming years
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- Figure 7: Population aged 65 years and over in Canada, historical and projected (% of total), 1971-2061
- Figure 8: Projected trends in the age structure of the Canada population, 2014-19
- The population is growing and becoming ethnically diverse
- Women outnumber men in Canada and live longer
- Wage gap declines but women still earn less than men
- Growth of the LGBT community
Key Players – What You Need to Know
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- Meridian credit union seeking license for national online bank
- BMO launches a service that allows people to open accounts through smartphones
- Scotiabank branches out with two new branch formats, Express and Solutions
- Goldman Sachs – Online lender for the masses
Industry Developments
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- Meridian credit union seeking license for national online bank
- RBC first to offer free Interac e-transfer payments
- Meridian introduces Sweep: A feature that ‘sweeps’ money daily
- Scotiabank branches out with two new branch formats, Express and Solutions
- BMO launches a service that allows people to open accounts through smartphones
- Grow and Celero partner for digital banking solutions
- Goldman Sachs – Online lender for the masses
Marketing Campaigns
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- Selected campaigns from Mintel Comperemedia
- Tangerine aims to eliminate the hassle-factor in switching banks
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- Figure 9: Tangerine’s switch assistant print advertisement, September 2015
- TD’s new MySpend App
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- Figure 10: TD’s Myspend app customer email, August 2016
- TD’s switch offer
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- Figure 11: TD free gift inducement offer, June 2016
- Tangerine releases follow-up to “Hard Work” Brand Anthem
The Consumer – What You Need to Know
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- Nearly seven in ten Canadians have a ‘big five’ as their main bank
- While TD is still on top, Tangerine emerges as a strong switching choice
- Lower fees are the top factor that influences switching
- Younger, Asian Canadians and LGBT consumers more inclined to switch
- Young males and Asian Canadians more likely to prefer banking with multiple financial institutions
Choice of Main Financial Institution
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- Nearly seven in ten Canadians have a ‘big five’ as their main bank
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- Figure 12: Choice of main FI, August 2016
- Scotiabank and RBC top choices in Atlantic Canada, while Desjardins is the clear market leader in Quebec
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- Figure 13: Top main fi choices in Atlantic Canada and Quebec, August 2016
- Tangerine appeals to a younger clientele
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- Figure 14: Choice of PC financial and Tangerine, by age, August 2016
- One in three Chinese Canadians considers TD as their main FI
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- Figure 15: Choice of main FI (main five), Chinese Canadians vs overall population, August 2016
Switching Choice of Main FI
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- While TD is still on top, Tangerine emerges as a strong alternative choice
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- Figure 16: Switching choice of main FI, August 2016
- Leveraging brand image to cement a distinctive brand personality
- Influencing switching decisions by harnessing the power of recommendations
- Among 18-24s, Scotiabank is the leading switching choice
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- Figure 17: Leading switching choice of FIs (select FIs), by age, August 2016
- Likelihood of switching to Tangerine increases with age
Switching Influencers
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- Lower fees, value for money and proximity are the switching influencers
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- Figure 18: Switching influencers (top five), August 2016
- Branches matter to both young and old
- Higher interest rates on savings is the top factor for over-65s
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- Figure 19: Top-five rank of factors influencing switching, by age, August 2016
- Online banks use different strategies
Cross-sell Incentives
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- Preferred rates, discounts, rewards and cash incentives appeal to nearly half of consumers
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- Figure 20: Interest in cross-sell incentives, August 2016
- Higher income customers more interested in an exclusive member program
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- Figure 21: Interest in select incentives, by income, August 2016
- Younger consumers are more motivated by rewards and cash incentives
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- Figure 22: Interest in select incentives, 18-44s vs over-45s, August 2016
- Women relatively more interested in preffered rates and rewards
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- Figure 23: Interest in select incentives, men vs women, August 2016
Satisfaction and Loyalty
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- Younger consumers and Asian Canadians are more inclined to switch their main FI
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- Figure 24: Attitudes related to satisfaction, August 2016
- Men are more inclined to agree that credit unions conduct business more fairly than banks
- Majority of customers agree that a strong local branch relationship builds loyalty
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- Figure 25: Attitudes related to loyalty, August 2016
- Younger consumers more likely to expect referral rewards
- PC Financial customers more likely to recommend their bank
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- Figure 26: Select attitudinal statements (any agree), PC financial vs overall, August 2016
- Desjardins customers least inclined to switch
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- Figure 27: Select attitudinal statements (any agree), Desjardins vs overall, August 2016
Preferences and Trust
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- Young, middle-aged men and Asian Canadians more likely to prefer banking with multiple financial institutions
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- Figure 28: Attitudes related to customer preferences, August 2016
- Young and middle-aged males more likely to prefer banking with multiple institutions
- Men more likely to agree that credit unions have a more welcoming feel
- Banks and credit unions enjoy high levels of trust
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- Figure 29: Attitudes related to trust, August 2016
- Men and Asian Canadians are relatively more likely to trust independent financial advisors
- Desjardins customers less inclined to bank with multiple institutions
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- Figure 30: Attitudinal statements about trust (any agree), by main FI, August 2016
Appendix – Data Sources and Abbreviations
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- Data sources
- Consumer survey data
- Consumer qualitative research
- Abbreviations and terms
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