Bank customer satisfaction stands at a remarkably high 85%, according to Accenture’s 2016 Digital Banking Survey of over 4,000 consumers in the United States and Canada. But that figure disguises a much tougher reality for many banks—that an increasing number of customers are switching to other institutions.

Of the 11% of North American consumers who switched banks last year (up from 10%), Millennials (19%) and mass-affluent individuals (18%) are the most likely demographic groups to switch. All switchers report that they leave most often for cheaper products and more convenient branch locations, and they also say that making the switch is getting easier and easier.

“Consumers no longer view switching banks as a hassle, which puts pressure on firms to not only attract new customers, but find ways to keep existing customers loyal,” said David Edmondson, senior managing director of Accenture’s North America Banking practice. 

Satisfaction Does Not Guarantee Retention

When nearly a fifth of a bank’s youngest and most affluent customers are leaving, that’s a sure sign that customer satisfaction does not necessarily equal customer retention. The question for many banks is how to evolve from customer satisfaction to true customer loyalty. That’s especially difficult today when banks are often competing in a commoditizing industry. They get trapped in an endless loop of one-upping and matching each other on discounts and product offers.

To break out of this loop, the Accenture report states that companies need to reinvent loyalty by focusing on value, relationships and service. This is a more holistic approach to the customer relationship and goes far beyond conventional loyalty programs. Which, by the way, are generally not working: 67% of consumers do not participate in a bank rewards or loyalty program. And 17% of consumers are not sure they participate—or do not know if their bank offers one.

Adding Value to Improve the Banking Experience

Consumers overwhelmingly say that to stay loyal they want their banks to act as value discounters on their behalf. Forty-five percent of consumers say the top reason that they would stay loyal to their bank is if it offers discounts on purchases of interest—from banking products to cars, home goods, and travel.

Sinology PDF Cover

Relevance is also key to value. No one wants a great deal or convenient access to a product or service that they would never buy. Relevance comes from rich customer data insight. Fortunately for banks, consumers are open to sharing personal data with them. Sixty-three percent are willing to share data to receive relevant product and service options.

Building Relationships to Cultivate Loyalty

The majority of consumers (79%, the same as in 2015) continue to view their banking relationships as transactional, not advice-based. To create stronger ties, banks should explore new roles, becoming a go-to resource for how consumers live, rather than being a pure financial utility. There are several roles to play, the Accenture report states, from brokering partner services to providing an open platform for buyers and sellers to interact.

Delivering real-time, personalized interactions is another way to cultivate loyalty. Digital marketing platforms can capture customers’ implicit and explicit intent through triggers such as key word searches, social interaction and transaction indicators, so banks can move beyond simple transactions.

Banks also have a very powerful tool to build and reinforce these relationships: the branch network.The vast majority (87%) of consumers, including 86% of Millennials, said that they will use the branch in the future. That’s good news in terms of loyalty. In the survey, 49% of consumers said “I trust my bank more when speaking to someone in person.”

Sinology PDF Cover

Delivering Service on Customers’ Terms 

Banks must be relentless about customer service and deliver it consistently across channels—and continually refine service based on customer feedback, according to the Accenture survey. Customers want seamless “phygital” experiences that blend physical and digital, and few banks are meeting their demands. Minimizing channel conflict will help banks stand out.

While some customers will always be driven by the deal, others are willing to pay for better service and ease of doing business. For example, the number one reason that consumers who applied for a loan in the past year would pay more is if they receive end-to-end customer service through the loan process.

Looking Forward

Banking consumers know what they want, and are increasingly likely to switch banks to get it. Retails banks cannot wait to meet consumers’ demands for discounts, convenience and relevance. To convert customer satisfaction to true customer loyalty, they need to blend digital and branch banking in exciting new ways to deliver value, strengthen relationships and offer unparalleled service.

“Today’s consumers expect their service providers to understand and anticipate their needs and offer a seamless experience across digital and physical channels – and they expect this as much from their bank as they do from retail stores and Internet giants,” Edmondson said.

To learn more about the key findings from Accenture’s 2016 North America Consumer Digital Banking Survey:  

Visit www.accenture.com/consumerbankingsurvey

Follow Accenture on Twitter

@BankingInsights

#NABankStudy

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.