The Relationship-Centric BankLearning what your customers really want just might be the key to creating a relationship-centric bank.

According to a Gallup survey in 2009, only about half of customers surveyed could strongly agree that their banks performed the sorts of actions that likely would keep customers coming back, such as “making me proud of where I bank”, or “keeping me informed of new opportunities”, or even “understanding my financial goals” .

And a desire for repeated contact with a provider is just the beginning of a healthy relationship.  Another survey conducted by Forrester in 2010 asked respondents if they agree with the statement, “my financial services provider does what is best for me not just its own bottom line” . Results showed that a majority of respondents simply don’t trust their banks.

Gallup has done extensive research on customer engagement (how and why customers have a strong emotional tie to products and brands). According to Gallup’s methodology, described in the article “Bankers, Meet Your Customers” (published in 2009), “the baseline requirement for customer engagement is rational satisfaction, which comes from meeting a customer’s needs, such as price, speed and efficiency.” 

Companies that fulfill these needs are more likely to have loyal clients who renew and refer business. However, the “real difference in customer behavior and profitability comes from going beyond rational satisfaction to emotionally engaging customers with your products and services” .  I would venture further to say that every customer contact that is positive, fulfilling, and emotionally engaging contributes to the health of the relationship, and, thus, the loyalty that a person feels toward the other party in that relationship.

The Value of a Healthy Relationship
Why is a healthy, loyal customer relationship valuable for banks? Few would dispute the benefits, and many different studies show that loyal customers are less price sensitive , hold higher deposit balances , use more credit products , and also are better at credit repayment  with the banks that have won their loyalty.

Gallup has proven that customers who are fully engaged in their relationships “delivered a 23% premium over average customers in share of wallet, profitability, revenue, and relationship growth, while actively disengaged customers represented a 13% discount on the same measures” .

Most bankers will rate loyalty and development of customer relationships fairly high on their list of priorities, yet customers seem to be unhappy with the quality of those relationships.  Somewhere there is a serious disconnect, and the seriousness is reflected in a 2009 survey by Deloitte entitled, “Rebuilding the Relationship Bank”. For example, the study concluded that only 36% of the consumers surveyed were very satisfied that their primary bank understood their needs. And, when related to a major life event, such as getting married, having a child, nearing retirement, or moving to a new home, only 18% of the consumers surveyed reported that their primary bank had contacted them to suggest appropriate products.   Shouldn’t understanding customer needs and helping them through major life events be some of the primary activities for a bank?

Senteo

Known in the industry as “experience creators”, the Senteo team has delivered more than 250 successful projects around the world, including projects for 14 of the top 100 brands and 18 of the top 100 banks in the world.

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