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Customer Satisfaction in Financial Services - Canada - November 2015

Published By :

Mintel

Published Date : Nov 2015

Category :

Banking

No. of Pages : N/A

Customer satisfaction is a key determinant of success in the retail financial services market. Overall satisfaction is related to satisfaction with attributes that are relevant to each product category. In this report we drill down into the attributes that drive customer satisfaction in the main product categories in financial services such as general banking, investments and lending. The report also explores choice of financial institutions, tenure and general attitudes related to satisfaction and customer experience.

Table of Content

Overview

Definition
Regional classifications
Income

Executive Summary

The issues
Big five banks dominate outside Quebec
Figure 1: Choice of FI, by product category, September 2015
Overall satisfaction generally high but interest rates and fees are the negative drivers
Leaders in satisfaction: PC Financial performs strongest in general banking and Desjardins across most categories
Trends in customer experience: Older consumers visiting branches less due to online banking while a third of all consumers have recommended their financial institution
Figure 2: Attitudes about customer experience with financial institutions, September 2015
The opportunities
Customer acquisition strategies in a concentrated marketplace
Increasing the focus on under-satisfied segments such as LGBTs and Chinese Canadians
Harnessing the power of recommendations and reviews
Figure 3: Agreement with statement on recommendation (% who agree), by customers of financial institution, September 2015
Leveraging social media to deepen customer connections
What it means

The Market – What You Need to Know

Aging population likely to positively impact customer satisfaction
Increasing diversity poses a challenge to financial services companies
Softening of the Canadian economy could be a risk to highly leveraged consumers
Financial institutions need to work harder to bridge the trust deficit among the LGBT community

Market Factors

Canada’s population is expected to age in the coming years
Figure 4: Population aged 65 years and over in Canada, historical and projected (% of total), 1971-2061
Figure 5: Projected trends in the age structure of the Canada population, 2014-19
The population is growing and ethnically diverse
Recent economic activities have negatively impacted consumer sentiment
Growth of the LGBT community

Key Players – What You Need to Know

Innovation Labs
Social media customer engagement with Canadian banks
Experiential marketing and US financial institutions

What’s New?

RBC to offer voice recognition
Scotiabank and CIBC launch innovation labs
Customer service on social media platforms
Fidelity lets customers view their investment portfolio in 3D
Figure 6: #Fidelity Labs: StockCity for Oculus Rift, September 2015
Experiential marketing and US banks
Acknowledgement of current customers
BMO – #HelpGiven “Arash’s Day Off”
Figure 7: # HelpGiven Arash’s Day Off, September 2015
Scotiabank – #My1500
Figure 8: #My1500 Marriage Proposal, September 2015
RBC – #HappySending
Figure 9: Tales of #HappySending – Princess and the Pea, September 2015

The Consumer – What You Need to Know

Big five banks dominate general banking but less so in regards to lending and investments
PC Financial customers most satisfied overall with their main general bank while TD scores highest among the big five
British Columbians and LGBTs are relatively less satisfied with their main lending provider while higher income earners are more satisfied with their main investment company
Harnessing the power of recommendations and reviews

Choice of Financial Institutions

Big five banks dominate general banking but less so in regards to lending and investments
Figure 10: Choice of FI, by product category, September 2015
Brand reputation and its influence on consumer choice
Different competitive landscape in Quebec
Figure 11: Choice of main FI in Quebec, September 2015
Around half of general banking customers have been with their FI for 15 or more years
Figure 12: Tenure with financial institution, September 2015
Young males are more likely to contemplate switching
Figure 13: Agreement with statements regarding choosing and switching, September 2015

Satisfaction with General Banking Provider

Overall satisfaction is high
Figure 14: Satisfaction with main general banking provider, September 2015
Older consumers are very dissatisfied with interest rates on deposits
Figure 15: Significant differences by attribute (%satisfied), 18-34s vs over 55s, September 2015
PC Financial customers most satisfied with their main bank
Figure 16: Overall satisfaction with general banking provider, by FI, September 2015
TD scores highest among the big five banks
Figure 17: Satisfaction rank (general banking), by attribute, September 2015
Key driver analysis
Methodology
Problem resolution and customer service are among attributes that FIs need to promote in order to drive satisfaction
Figure 18: Key drivers of overall satisfaction with general banking institution, September 2015
Payment options including money transfer are much more relevant drivers for satisfaction among BMO and RBC customers
Figure 19: Overall satisfaction with primary general banking institution – Key driver output, September 2015

Satisfaction with Lending Provider

Interest rates and speed of approval/closing register lower satisfaction rates
Figure 20: Satisfaction with main lending provider (% satisfied), by attribute, September 2015
British Columbians are relatively less satisfied with their main lending provider
LGBTs are less satisfied with their main lending company
Figure 21: Satisfaction with lending provider attributes (% satisfied), LGBTs vs overall population, September 2015
Desjardins ranks highest in overall satisfaction
Figure 22: Overall satisfaction with lending provider (% satisfied), by FI, September 2015
Big Five Banks’ scores are fairly similar
Figure 23: Satisfaction rank by attribute with main lending provider, September 2015
Key driver analysis
Methodology
Speed of loan closing is a less important driver of satisfaction for CIBC customers
Figure 24: Overall satisfaction with lending institution – Key driver output, September 2015

Satisfaction with Main Investment Company

Higher income earners are more satisfied with their main investment company
Figure 25: Satisfaction with main investment provider (% satisfied), by attribute, September 2015
Chinese Canadians are less satisfied
Figure 26: Satisfaction with investment providers (% satisfied), Chinese Canadians vs overall population, September 2015
Scotiabank and Desjardins have the most satisfied investment customers
Figure 27: Satisfaction with investment provider (% satisfied), by FI, September 2015
Scotiabank scores highly on account information, communication and Desjardins on quality of financial advice and fees
Figure 28: Satisfaction rank by attribute with main investment provider, September 2015
Key driver analysis
Methodology
Choice of savings/investment products for instance are much more relevant drivers for satisfaction among TD consumers
Figure 29: Overall satisfaction with investment institution – Key driver output, September 2015

Opinions Regarding Customer Experiences

Older consumers visiting branches less due to online banking
Figure 30: Agreement with statements about customer experience (% who agree), September 2015
Consolidation of products with one institution is most attractive to the youngest and oldest age segments
Older females most trustful of financial advisors
PC Financial and TD customers most likely to recommend their bank
Figure 31: Agreement with statement on recommendation (% who agree), by customers of financial institution, September 2015
Credit unions in danger of ceding their core value proposition

Attitudes Regarding Recommendations and Reviews

Around a third have recommended their financial institution
Figure 32: Agreement with statements regarding recommendations (% agree), September 2015
Satisfied customers are more likely to help spread the word
Leveraging social media to deepen customer connections

Appendix – Data Sources and Abbreviations

Data sources
Consumer survey data
Consumer qualitative research
Abbreviations and terms

Appendix – Key Driver Analysis – Satisfaction with Main General Banking Provider

Interpretation of results
Figure 33: Overall satisfaction general banking institution- key driver output, September 2015
Figure 34: Satisfaction with general banking attributes, by primary financial institution, September 2015
Figure 35: Key drivers of overall satisfaction with TD, September 2015
Figure 36: Key drivers of overall satisfaction with RBC, September 2015
Figure 37: Key drivers of overall satisfaction with CIBC, September 2015
Figure 38: Key drivers of overall satisfaction with BMO, September 2015
Figure 39: Key drivers of overall satisfaction with Scotiabank, September 2015
Figure 40: Key drivers of overall satisfaction with Desjardins, September 2015

Appendix – Key Driver Analysis – Satisfaction with Main Lending Provider

Interpretation of results
Figure 41: Overall satisfaction with lending institution - key driver output, September 2015
Figure 42: Satisfaction with attributes, by primary lending institution, September 2015

Appendix – Key Driver Analysis – Satisfaction with Main Investments Provider

Interpretation of results
Figure 43: Overall satisfaction with investment product attributes by financial institution – key driver output, September 2015
Figure 44: Satisfaction with investment product attributes, by primary financial institution, September 2015

List of Table

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