Digital transformation and rising inflation have created a new set of customer engagement challenges for U.S. retail banks, according to a new study from J.D. Power.
Most banks “are missing the mark” in making customers feel supported as more U.S. consumers indicate that their financial stress has increased, according to the J.D. Power 2022 U.S. Retail Banking Satisfaction Study. With nearly half of customers moving to primarily digital-centric relationships, banks have also struggled to deliver on customer expectations for personalization, J.D. Power said in a statement.
“A customer’s definition of what support from their retail bank looks like is changing rapidly as we enter a new economic cycle and move further along the digital adoption curve,” Jennifer White, senior consultant of banking intelligence at J.D. Power, said in the statement. “It’s no longer predominately about being fast, efficient or convenient. The preeminent performance metric with the biggest influence on customer satisfaction is ‘supporting customer during challenging times,’ and that means customers are expecting a personalized mix of financial advice, hands-on help with problem resolution and guidance on how to grow their money.”
The study found that bank customers seek support in tough economic times. Overall customer satisfaction with retail banks is 155 points (on a 1,000-point scale) higher when customers say their bank supports them during challenging economic times, the statement said. The study found that 63 percent of customers say they definitely will not switch banks, and 78 percent say they definitely will reuse their bank when it delivers this support.
But J.D. Power said that despite its effect on customer satisfaction, only 44 percent of banks are delivering on this metric.
The study also found that while banks perform particularly well on traditional customer engagement metrics such as people, digital channels and overall trust, satisfaction scores are lowest for helping retail bank customers save time or money. J.D. Power said this has become a key priority for customers.
Other findings include that 61 percent of customers either did not know or were unsure whether their bank had made any changes to their overdraft fee policy. Also, when asked how they would like their bank to personalize their banking experience, 46 percent of customers said they want help in avoiding fees and 37 percent said they want to receive account alerts.
The study was based on responses from 101,587 retail banking customers of the largest banks in the U.S. regarding their experiences with their retail bank. It was fielded from April 2021 through January 2022. The study was divided into 15 geographic regions, and Bangor Savings Bank and Rockland Trust tied for the highest-ranking banks in the Northeast region with a score of 722 on a 1,000-point scale.
“It is a tremendous honor to be recognized by J.D. Power and our customers for our quality of customer satisfaction,” Robert Cozzone, Rockland Trust’s chief operating officer and executive vice president of consumer and business banking, said in a statement. “We have worked especially hard over the last couple of years to provide stability, advice and care for our customers amid the challenging circumstances we’ve endured together as a community. This recognition is a testament to the strong relationships our colleagues have built with the individuals and families we’re fortunate enough to serve. “
