REPORT

Looking at the bank from

the customers point of view
October 2014

Looking at the bank from the customers point of view

Contents
Executive summary..........................................................................................................3
The drivers behind customer choice...................................................................................4
A brand new customer journey.........................................................................................7
Dealing with customer dissatisfaction...............................................................................10
Advice for advocacy; a win-win approach.......................................................................13
Conclusion...................................................................................................................17
About us......................................................................................................................19

Executive summary
During the summer of 2014, EY was asked to contribute to four think tanks organised by
Efma, the European association for retail financial services. The think tanks explored the theme
Looking at the bank from the customers point of view.
Discussions were framed around the results of EYs third annual Global Consumer Banking
Survey: Winning through customer experience, which launched in spring 2014. The survey
canvassed the views of more than 32,500 retail banking customers in 43 countries worldwide.1
This paper summarises the key areas of discussion, including contributions and insight from
Efma members who participated in the think tanks. Each event examined a particular aspect of
customer service in retail banking. Some of the key points were as follows:
E
 uropean banks customers are increasingly willing to switch. This is making long-term
customer relationships more valuable. In response, banks are strengthening their acquisition
and retention efforts. Transparency, simplicity and effective communication are particular
areas of focus.
C
 ustomer interactions with their banks are moving from a physical to remote-channel
framework, and are increasingly split between self-served and intermediated. Personalised,
human-based contact is still preferred for complex needs, but openness to remote counselling
is growing. This requires banks to move from a silo multi-channel approach to an omnichannel model, supported by effective segmentation, to deliver a customer-centric experience.
C
 ustomer complaints are growing in number and reputational importance. They also
represent a golden opportunity to build stronger relationships. Banks are trying to improve
their response, but face many structural obstacles. Transparency, employee empowerment
and data analysis play a key role.
E
 ffective advice is a key driver of satisfaction, trust and advocacy. Though many customers
prefer personal advice, there is scope to do more remotely. But this requires a difficult mix
of technology and expertise. Regulation is also a hurdle. For banks that can use it to their
advantage, social media has the potential to enhance levels of engagement with customers.
Reconciling these competing forces to achieve success will not be easy. There will be significant
implications for banks business models. The overall strategic imperatives are to strengthen
customer attraction and retention.
Making the required improvements will depend on developing a range of capabilities and
overcoming a variety of obstacles. These will depend on each banks current business models
and competitive positioning.
We hope readers will find this paper a useful and interesting starting point to explore some
of the complex customer challenges facing European banks. We would be delighted to
hear your views.
Marco Brandirali
Director
FSO Advisory, EY Italy
+ 39 02 8066 9693
marco.brandirali@it.ey.com
1

Gianluca Ghigliano
Senior Consultant
FSO Advisory, EY Italy
+ 39 02 722 121
gianluca.ghigliano@it.ey.com

Visit www.ey.com/gcbs to download a copy of EYs Global Consumer Banking Survey 2014.

Looking at the bank from the customers point of view

The drivers behind customer choice

Retail banking customers in Europe continue to become less loyal and more nomadic. Our survey shows that
they are increasingly willing to challenge existing financial relationships and look for alternatives. This means
that long-term customer relationships are going to become less common than in the past, but more essential
to banks profitability. In fact, growing acquisition costs mean that few customer relationships make a profit
during their first two years. Instead, profitability strengthens over time as customers purchase more products
and services, contact the bank less often and via less costly channels, and generate more referrals.
It is more important than ever for European banks to understand the drivers of customer attraction
and retention. Our survey shows that three factors drive customer choice of new bank accounts:
1. Anticipated customer experience
2. The level of rates or fees
3. Convenience
In Eastern Europe, accessibility and branch location are also important factors.
Once they have joined a bank, customers strongest drivers of satisfaction are accessibility and
transparency. And when it comes to closing bank accounts, the leading factors are dissatisfaction
with rates and fees, or a disappointing customer experience.
This means that customers appear to leave banks over cost issues, but are more likely to choose new
ones based on the promised customer experience. This pattern is especially common in markets such
as Italy, Spain and Turkey. By contrast, customers in the UK are more likely to close a bank account
based on their experience, and to open a new one based on attractive rates or fees.

The drivers behind customers choice

Reasons for opening and closing accounts
Global

France

Italy

United
Kingdom

Spain

Russia

Turkey

30%

25%

27%

34%

25%

35%

31%

37%

41%

36%

38%

39%

31%

39%

36%

25%

33%

42%

32%

36%

36%

46%

37%

47%

43%

26%

26%

30%

35%

39%

39%

47%

37%

33%

45%

41%

28%

Access to branches and

banking services

17%

10%

29%

26%
25%

31%
30%
24%

20%
32%

26%
24%

23%

22%

24%

26%

25%

38%

20%

37%

58%
32%
31%
23%

7%

13%

12%

8%

7%

28%

22%

14%

14%

21%

14%

30%

28%

28%

13%

29%

9%

18%

10%

20%

7%

10%

15%

6%

13%

34%

7%

26%

14%

26%

3%

19%

20%

31%

14%

32%

19%

7%

6%

6%

0%

5%

6%

3%

13%

6%

13%

10%

8%

6%

8%

15%

17%

10%

8%

7%

Information provided by
news or advertising

5%

5%

3%

10%

0%

5%

7%

3%

3%

4%

9%

6%

4%

5%

7%

5%

7%

10%

8%

Their decision to open or

close branches

6%

5%

4%

6%

2%

2%

9%

2%

4%

5%

5%

3%

2%

2%

3%

3%

4%

5%

2%

4%

8%

16%

6%

23%

8%

6%

15%

13%

4%

8%

7%

12%

6%

13%

7%

6%

14%

12%

5%

7%

3%

4%

5%

4%

4%

1%

5%

6%

3%

0%

2%

3%

2%

4%

5%

3%

1%

1%

1%

4%

Information provided by
friend or relative

Other
Not sure

9%

Close accounts

Germany

25%

More convenient to have

everything in one place

Branch/office location

Eastern
Europe

33%

Experience with financial

services providers
Rates/fees

Western
Europe

Open accounts

10%

The survey shows that consumers decisions about new banking providers are influenced by a wide
range of opinion. The good news for banks is that the sources of information they control such as
their websites, branches and employees typically remain the most important. This gives banks a
springboard to communicate their attraction and retention efforts to actual and potential customers.
However, the opinions of family and friends also carry a lot of weight with customers. In some
European markets, third parties such as financial advisers in France, social networks in Turkey and
comparison websites in the UK, play a significant role. Sources of information used when searching
for a financial services provider

Sources of information used when searching for a financial services provider

Percentage of customers selecting among top 3 information sources
Global
Bank websites
Information
from branch
Bank employees
Friends and
or relatives

38%

29%

22%

29%

Western
Europe

Eastern
Europe

32%

41%

23%

36%

23%

28%

25%

26%

France
22%

18%

14%

22%

Germany
31%

Italy

Spain
34%

26%

21%

29%

26%

24%

27%

24%

27%

19%

32%

Social media

13%

7%

14%

Financial advisor

16%

13%

12%

Third-party
websites

14%

16%

TV and/or radio
commercial/ads

12%

7%

11%

3%

8%

7%

8%

Magazine or
newspaper ads

10%

7%

7%

4%

5%

10%

Information sent
in the mail

10%

6%

5%

5%

7%

5%

16%

4%

19%

15%

Top 3 information sources

United
Kingdom

Russia

40%

27%

14%

14%

Turkey

39%

35%

39%

36%

34%

25%

24%

24%

7%

11%

11%

5%

13%

11%

12%

14%

9%

14%

6%

12%

15%

9%

12%

12%

5%

5%

7%

8%

5%

6%

5%

4%

22%

20%

12%

27%

18%

Information sources

Faced with customers increasing willingness to open and close accounts, European banks are
exploring new approaches to customer acquisition. These typically depend on each banks strategic
situation and existing customer base. For example, smaller banks and new entrants might focus on
opening new branches or product innovation. In contrast, larger incumbents might develop referral
reward programmes or new mobile services.
Banks across Europe are also putting more emphasis than ever before on developing effective
customer retention strategies. Our survey shows that many customers are not actively retained;
they just remain. A large proportion of those customers not planning to switch are merely avoiding
the inconvenience involved, or believe that no one bank is better than another. The survey also
shows that customers can switch with little warning and that banks see non-bank challengers as an
increasing threat in areas such as payments.

Looking at the bank from the customers point of view

Some areas of focus for European banks are intended to meet the needs of both attraction and
retention. One is a drive for simplicity, which customers from every segment value highly. Pricing
simplicity is one vital aspect, and many banks are working to clarify their fee and rate structures in
every area, from mass market to private banking. Banks are also finding that simpler product ranges
not only increase satisfaction, but encourage customers to take quicker decisions. Some banks plan
to combine transparency with a more tailored approach by letting customers configure their own
service and pay only for the features they want.
Effective communication is another crucial theme for both attraction and retention of customers. This
reflects the importance of transparency and communication for building customer trust.

Drivers of trust
Reasons cited for having complete trust in primary financial services provider (Global data)

Financial stability

Institutional
stability

60%

Ability to withdraw money

54%

Their security procedures

51%

The size of the company

42%

The way I am treated

Customer
experience

56%

How they communicate with me

44%

Quality of advice provided

41%

Problem resolution/complaint handling

My relationship with certain employees

Rates and fees

The fees I pay

26%

Interest rates I earn on my accounts

24%

Interest rates I earn on my loans

Stories from friends or relatives

Other

38%
19%

20%
14%

Their decision to open or close branches

9%

Recent articles or news stories

8%

Targeted, differentiated communication is highly valued by customers. To optimise retention, banks

should focus on customers with multiple products and multiple banking relationships. This group is
not only economically valuable to the banks, but also the most likely to be open to switching. Despite
their investments in CRM technology, many banks are not yet harnessing the full potential of the
transaction and interaction data they hold.

A brand new customer journey

Customers today expect the same fundamental services from their banks as in the past: namely, a
secure, convenient environment for making deposits, obtaining credit and transferring money. However,
in the areas of communication and interaction, customer expectations are changing rapidly.
More recently, European banks have encouraged customers to make less use of their branches
and more use of remote channels. Although this was partly driven by customer service goals, cost
reduction was also a major factor.
Analysis derived from our survey data shows that splitting customer interactions between branches
and remote channels is misleading for banks and confusing for customers. It is more helpful to divide
customers interactions between those that are intermediated by a bank professional, whether inbranch or remotely, and those that are managed through self-service. Customers are increasingly
disintermediating simple transactions, enquiries and administration. Nonetheless, they would still
prefer personal contact, preferably in branches, when seeking advice and new products, or when
making a complaint.

Channel preferences
Percentage of customers who prefer channels for specific tasks (Combined Western and Eastern European data)
Balance inquiry

10%

Bill payments/transfers

3%

2%

16%

Administrative

41%18%

60%

10%

23%

2%

54%

Advice

2%

14% 23%

Call centre

5% 2%

ATM

4% 1%

Online/Internet

1% 3%

18%

9%

17%

64%

Branch

24%

35%

62%

Purchase of products
and/or services

2% 4%

4% 3%

54%

Make deposit

2%2%

57%

7%

45%

Buy/sell investments

8% 1%

67%

3%

26%

Report a problem/obtain status

22%

Mobile

2%

15%

26%

1%2%

3%2%

2%1%

Other

Even so, this does not mean that customers are not willing to use remote channels for more complex
enquiries. Some are becoming open to remote counselling receiving advice by phone, online or via
video chat. This is especially true in Eastern European markets such as Russia and Turkey.

Looking at the bank from the customers point of view

Openness to remote counselling

Percentage of customers who are somewhat or very interested in obtaining financial advice or
assistance in different ways
Global
In person

61%

Western
Europe

59%

Eastern
Europe

France

Germany
59%

66%

63%

Italy

50%

Use online financial

management tools to make
decisions around spending,
investments and loans

49%

30%

52%

36%

22%

32%

Use online financial

management tools to make
decisions around spending,
investments and loans

48%

26%

52%

31%

20%

30%

By video chat from

home or work

31%

14%

53%

47%

31%

17%

43%

8%

64%

59%

Can speak to someone I

know at the branch by phone
during working hours

42%

United
Kingdom

Spain

46%

23%

54%

Russia

Turkey
69%

66%

40%

32%

49%

56%

36%

29%

54%

61%

24%

59%

58%

32%

18%

11%

30%

38%

The most popular answer stated per region/country

Some European banks are already offering customers access to a range of video content in the form
of discussions by investment advisers and economic experts. For now, only a minority offer video
chat as a customer contact option, but going forward many players are planning to do so soon.
Video links exemplify the potential for banks to combine personalisation and human contact with the
use of electronic, remote channels. With the right resources and safeguards, many banks contact
centres could also combine more complex customer advice with the convenience of extended hours.
For most banks, offering a choice of contact points is nothing new. Yet customers increasing flexibility
means that banks need to move from a multi-channel to an omni-channel model. This means developing
the capability for customers to complete interactions seamlessly across several channels. For example,
some banks allow customers to search online for individual advisers in nearby locations, while also
giving them the option to get in touch electronically. This type of electronic and physical integration
creates significant demands on banks technology and data. However, it is something that customers
already receive from other industries, and increasingly expect from their banks.
As they adapt their distribution models, banks need to broaden their customer segmentation to
include behavioural factors, not just economic criteria. This will help them to judge their customers
value and loyalty, and to make their communication more effective. It will also show them that many
of their most valuable customers are those that never come into a branch. In fact, many of the banks
most profitable customers are now committed users of the multi-channel distribution models that
banks engineered to deliver mass-market, low-cost service. This, in turn, means that banks should
develop new ways to overcome the reluctance of some customers to use electronic channels, such as
introducing online services to branches or offering free coaching.

Looking further forward, European banks will need to embrace more sophisticated customer
interaction techniques such as network building, co-creation and personalisation. That means
developing a brand new customer journey: a truly customer-centric experience. Banks need to
understand what the customer wants and what they can provide at each point of contact. Where
the two elements match, value will be created; where they do not, it will be eroded.

Customer-centricity diagram
From a bank that provides and services

...to a bank that answers its customers needs

Bank

Account

Account

Account

Account

Account

Customer

Account
Bank

Bank
Bank

Customer-centricity creates fresh challenges for the banks. Measurement is one: satisfaction and
performance metrics that work for branch interactions may not be adaptable to electronic channels. For
international banks, local variations can also be problematic. For example, the needs and expectations
of customers seeking a mortgage in the UK will be radically different to those in Spain or Italy.

Looking at the bank from the customers point of view

Dealing with customer dissatisfaction

The survey shows that patterns of customer complaints and customer satisfaction with banks
complaint resolution vary widely from market to market.

Complaints and resolution

Percentage of customers who experienced a problem
that required resolution in the past 12 months
Global

34%

Western Europe
Eastern Europe

Germany
Italy

United Kingdom

23%

30%

37%

25%

38%

Italy

16%

Spain

15%

13%

Turkey

13%

Very satisfied

42%
46%

35%

27%

31%

38%

53%

29%

31%

Russia

33%

36%

35%

United Kingdom

20%

30%

29%

Germany

21%

Russia
Turkey

16%

France

28%

42%

28%

Eastern Europe

32%

Spain

25%

Global
Western Europe

25%

France

Degree of satisfaction with

problem resolution

56%

34%

40%

30%

Satisfied

35%

47%

57%

Less than satisfied

Practical problems with internet and mobile banking are the most common source of problems,
although they are comparatively easy for banks to resolve. Fees generate the second highest level of
complaints, and are the area where customers are most likely to be left feeling dissatisfied. Operational
issues, such as lost or stolen cards, are more likely to be addressed to customers satisfaction.

10

Complaints resolution satisfaction

Problem resolution satisfaction by problem type (Western European data)

Average

20%

Standard operations

24%

Dispute, lost or stolen card

36%

36%

32%

Fees

15%

Payment/deposit

16%

Processing

18%

Denial of charges for

purchases and/or denial of
credit/loan requests

17%

Other

44%

40%

36%

29%

32%

56%

47%

39%

29%

32%

Very satisfied

37%

43%

54%

24%

Satisfied

44%

Less than satisfied

As previously discussed, customer experience is vital to customer attraction and retention, playing
a stronger role in account opening and closing than fees, rates, location or convenience. The fact
that customers are more likely than ever to complain about unsatisfactory experiences, pass on their
complaints to regulators, and publicise them via social media, means that complaint resolution should
be a vital competency for European banks. There is also an upside to growing levels of complaint,
namely, a growing appetite among customers for dialogue and conversation with their banks.
Dealing with problems effectively is a powerful way for banks to build trust and advocacy. There is
a direct link between satisfaction with problem resolution and advocacy. Among customers with a
problem, satisfaction with complaint handling is more likely to make them advocates of their bank,
rather than satisfaction derived from many other aspects of their service.

Problem resolution and advocacy

Advocacy
(Percent very likely to recommend PFSP)

Percentage of customers very likely to recommend primary financial services provider (PFSP) based
on satisfaction with problem resolution (Global data)

80%
60%

40%
20%
0%

Very
satisfied

Satisfied

Neutral

Dissatisfied

Very
dissatisfied

Not
resolved

Satisfaction with problem resolution

11

Looking at the bank from the customers point of view

Inevitably, when a customer asks for help with a problem, it is a real moment of truth for banks. Good
problem resolution presents significant opportunities; ineffective complaint handling presents substantial risks.
Despite this, several common institutional features make complaint management a challenging process
for many European banks. These include:
Silo-orientation which makes centralised monitoring and integration difficult and can lead to
inconsistencies, such as confusing a complaint with an enquiry
Inadequate policies or a tendency to focus on meeting policies and standards rather than creating
a satisfactory outcome for the customer
Lack of accountability with no one owning the process or taking responsibility for referral,
escalation or keeping the customer informed
Inability to fix root causes when banks lack the mechanisms to identify and implement coordinated
solutions, thereby preventing problems from recurring
The overall effect of these types of features is that many European banks struggle to develop complaint
handling processes that create value for themselves and for customers, let alone meet the increasingly
demanding expectations of regulators.
In response, European banks are taking steps to improve their transparency around complaint
handling. This includes giving customers guidance on how to complain and what response they should
expect, publishing data on their problem-resolution performance, and sending out updates on any
improvements they have made as a result of customer complaints.
Some banks seeking best practice in this area are learning from other industries, where complaint
resolution generates high levels of customer satisfaction. That typically means creating coordinated
programs to capture problems, centralise their management, track and analyse them, report on them,
identify root causes and develop multi-channel solutions.
Employee empowerment is an important piece of the puzzle when it comes to generating customer
satisfaction from complaints. It enables staff to have empathetic conversations with customers, and gives
them the authority and responsibility to take ownership of problem resolution. However, it challenges
some common features of banks current operating models, such as scripted, low-cost call centre service.
To overcome this problem, some banks are once again trying to emulate other industries. For example,
best practice in the hospitality sector typically involves training staff to use information from the
customer, together with their own initiative, to ensure a satisfactory outcome. Industry regulations may
make this flexibility more of a challenge in banking but not impossible. Smaller banks may find it
easier to offer autonomy to staff whereas big banks have tools and systems that can give valuable
support to empowerment.
Data analysis is another capability with the potential to assist in complaint resolution by helping to
identify underlying faults and predict future problems. However, as in many other areas, European
banks are only beginning to realise the value of the information they hold. This does not just mean
financial data, but also the type of interaction-based metrics that technology companies are good at
harnessing. For banks with the right technology and the right techniques, this data could allow them to
build strong customer partnerships.

12

Advice for advocacy; a win-win approach

Our survey shows that customers see personal service and advice from their bank as the strongest
driver of customer engagement. Customers attach a high value to banks that prioritise their
wellbeing, understand their long-term goals, identify ways to achieve those goals, and work with
customers to reach them together.

Advice and engagement

Percentage of customers who would pay a little more, add more accounts/services, or increase their
balance in exchange for advisory-related services
Top 10 regional
engagement
opportunities Global

Western
Europe

Eastern
Europe

France

Germany

Italy

Spain

Provides a plan to help

you reach your
financial goals

72%

52%

68%

Invests in your
financial well being

73%

50%

73%

39%

38%

58%

47%

Always finds new ways

to improve how you
conduct your business

71%

50%

71%

33%

34%

56%

41%

Rewards you for being

a loyal customer

65%

47%

67%

38%

29%

56%

46%

Finds ways to
save you money

64%

47%

66%

42%

55%

38%

Customises products and

services to fit your needs

62%

40%

Takes overall relationship

with them into account
when quoting fees/rates

61%

40%

Proactively alerts you to

products, services or sales/
promotions/special rates
that might be of interest

58%

39%

46%

Respects your
culture/religion

60%

39%

53%

Allows you to
choose from different
pricing options

57%

39%

56%

52%

64%

47%

30%

25%

31%

39%

28%

42%

39%

42%

31%

69%

42%

44%

56%

34%

46%

37%

41%

20%

38%

35%

38%

22%

53%

41%

United
Kingdom

48%

30%

Russia

Turkey

64%

72%

72%

82%

70%

70%

42%

70%

75%

44%

71%

74%

67%

33%

41%

33%

55%

26%

59%

61%

65%

68%

47%

62%

61%

62%

60%

66%

The most popular answer stated per region/country

Customers who receive professional help and advice of this kind are more likely to increase the
number of accounts and the level of assets they hold with a bank. They are also more willing to pay
a premium price for the service they receive. In Western Europe, the quality of advice that customers
receive is also an important driver of trust in their bank.

13

Looking at the bank from the customers point of view

Customer trust
Reasons cited for having complete trust in their banks
Western
Europe

Global

Institutional
stability

Financial stability

60%

Ability to
withdraw money

54%

Their security
procedures

51%

The size of
the company

42%

Customer
experience

The way I
am treated

Quality of
advice provided

41%

Problem resolution/
complaint handling

38%

Rates and
fees

My relationship with
certain employees
The fees I pay

26%
24%

Stories from
friends or relatives
Others

19%

Interest rates I earn

on my accounts
Interest rates
I pay on my loans

62%

45%

62%

20%

52%

37%

50%

28%

44%
53%
33%
32%

26%

Germany

45%

24%

39%

59%

48%

52%

35%

40%

14%

42%

33%

41%
39%

49%

36%

66%

55%

29%

30%

34%

23%

57%

54%

41%

48%

37%

47%

61%

44%

52%

43%

55%

53%

32%

28%

45%

19%

12%

38%

17%

11%

35%

52%

55%

68%

28%

27%

64%

27%

50%

37%

79%

51%

34%

57%

Turkey

56%

40%

33%

Russia

50%

51%

39%

60%

36%

United
Kingdom

Spain

32%

26%

51%

Italy

47%

38%

49%

22%

54%

56%

51%

61%

44%

France

48%

56%

How they
communicate

Eastern
Europe

52%
15%
32%

14%

29%

15%

9%

10%

11%

25%

12%

7%

11%

11%

7%

19%

13%

11%

7%

12%

8%

28%
17%

42%

16%
7%

27%

18%
29%

14%

13%

Their decision to open

or close branches

9%

4%

8%

4%

3%

4%

6%

6%

10%

9%

Recent news stories

8%

5%

5%

6%

3%

5%

9%

6%

6%

3%

The two most popular reasons stated per region/country

In Western Europe, the top two reasons for having complete trust in banks are related to
customer experience, whereas in Eastern Europe they are related to institutional stability

As shown by the chart overleaf, trust has a powerful link to stronger customer advocacy.
This is useful information for European banks, but it may only confirm what they already suspected
that effective personal advice is a key driver of strong, positive customer relationships. It may come
as more of a surprise that customers are increasingly willing to receive this type of service remotely
and, to a smaller extent, even via self-service. The enthusiasm for new technology is particularly
strong in Eastern Europe.

14

Advocacy and trust

Change in advocacy against change in trust in primary financial services provider
3%
13%

20%

68%
50%
84%

27%

30%

5%

Complete trust

Moderate trust

Very satisfied

Minimal/no trust
Neutral or unlikely to recommend

Very likely to recommend

Customers with complete trust in their bank show a much higher level of advocacy
With greater advocacy comes additional business, so earning complete trust is key to growth

Advice channels
Percentage of customers who are somewhat or very interested in obtaining financial advice or
assistance in different ways (Global data)
Western
Europe

Global

In person

61%

59%

Eastern
Europe

France

63%

Germany

66%

59%

Can speak to
someone I know at the
branch by phone
during working hours

50%

Use online financial

management tools to make
decisions around spending,
investments and loans

49%

30%

52%

36%

22%

Can speak to someone

by phone in a call center
whom I can call any
day, any time

48%

26%

52%

31%

By video chat from

home or work

31%

42%

14%

47%

31%

53%

17%

Italy

United
Kingdom

Spain

64%

59%

54%

Russia

Turkey

69%

66%

40%

32%

49%

56%

32%

36%

29%

54%

61%

20%

30%

32%

24%

8%

23%

43%

46%

18%

11%

59%

30%

58%

38%

The two most popular answers per region/country

15

Looking at the bank from the customers point of view

Contrary to some banks views, electronic channels are ideally suited to providing some valuable
types of advice such as making day-to-day recommendations on ways to create financial value.
However, when it comes to more complex financial decisions, there is no doubt that remote channels
present some challenges. Banks need to ensure they are providing enough professional support and
striking the right balance between human skills versus automated tools. Delivering effective advice on
an omni-channel basis is particularly difficult: it means getting the right advice to the right customer,
in the right place, at the right time ultimately ensuring a single view of the customer, ideally in real
time, available across all channels.
Meeting the requirements of local and European regulation is also a challenge. Banks are already
struggling to deal with the growing demands of conduct regulation, which in turn, is making their
customer interactions more complex and tentative. The requirements of MiFID II in areas such as
product documentation and recording customer conversations, pose an obvious hurdle for banks
ability to deliver advice remotely. Set against that, by removing many potential conflicts of interest,
MiFID II also provides an opportunity for those banks that can present themselves as true customer
partners, with no interest other than providing the best recommendations whilst being remunerated
for high-quality advice.
Despite these obstacles, European banks are exploring ways to combine remote channels with
personalised advice. For example, some banks are giving affluent clients round-the-clock support
from a dedicated adviser or relationship manager, via electronic channels rather than in a branch.
For retail, and small and medium-size enterprise (SME) customers, an alternative could be to provide
a centralised, expert advisory centre responsible for all their complex needs. This could be accessible
seven days a week via phone, internet and mobile channels, as well as working in partnership with
operational teams in branches as required.
Social networks represent a further potential step in banks ability to provide remote advice.
At present, most European banks are using social networks for publicity and general external
communication. Many are also monitoring social media to identify and respond to negative
comments and other reputational threats. By contrast, few, if any, have yet mastered the art of using
social networks for one-to-one relationship building.
Security of customer information is one obvious area of concern for banks keen to make greater use
of social media as a personalised distribution channel. Even so, social networks offer the potential to
be a useful relationship building tool. Banks that can develop a holistic, social media strategy by
analysing, responding to and shaping customer opinions and requests should be able to deliver
value to customers with every online contact. In time, social networks could not only offer European
banks a customer advice channel, but also provide an ideal forum for other initiatives such as tailoring
communication, building customer-centric experiences and turning complaints into opportunities.

16

Conclusion
EYs Global Consumer Banking Survey 2014 and the Efma think tank discussions demonstrate how
European banks are facing rapid changes in customer preferences. In this paper, we have only covered
some of those changes including:
An increasing willingness to switch, which is making long-term relationships more important but
harder to achieve
Continuously changing channel behaviour, with increasing bias towards remote counselling
A growing tendency to generate complaints and the increasing likelihood of sharing their
dissatisfaction if they are unhappy with how complaints are resolved
A growing interest in receiving effective personal advice through non-branch channels
These changes present some challenges to banks existing business models but also offer opportunities
to those who can respond effectively and provide customers with an excellent experience.
In response, European banks are making some major changes to their own business models. The key
strategic priority is to improve customer attraction and retention. That involves delivering attributes
that customers identify as being of particular importance, such as transparency, simplicity, effective
communication and useful advice.
To meet these goals, banks need to strengthen or develop a range of key capabilities, such as omnichannel banking, behavioural segmentation, complaint handling, data analysis, staff empowerment
and the effective use of social media.
Of course, making these changes is not always easy. Traditional banks often struggle to achieve
consistency across their large networks of branches, people and systems. Plus, they are constrained
by the sheer volume and cost of regulatory-driven change. This can work in favour of smaller, nimbler
players, but incumbents experience and deep pockets can also give them an advantage. International
banks need to overcome significant variations in customer preferences, especially between Western
and Eastern Europe, although this can provide the opportunity to compare best practices.
Working in a regulated industry can also create tension between the desire to deliver tailored customer
service and the need to meet the growing demands of local and European conduct regulation. However,
regulatory change could create an opportunity for those banks that are able to maximise its effects.
Banks that can reconcile these tensions better than their peers while keeping an eye on the future and
changing customer preferences are likely to enjoy the greatest success.

17

Looking at the bank from the customers point of view

Notes

18

About us

As a global not-for-profit organisation, Efma brings together more than 3,300 retail financial services
companies from over 130 countries. With a membership base consisting of almost a third of all large
retail banks worldwide, Efma has proven to be a valuable resource for the global industry, offering
members exclusive access to a multitude of resources, databases, studies, articles, news feeds and
publications. Efma also provides numerous networking opportunities through working groups, online
communities and international meetings.
For more information: www.efma.com or info@efma.com
Karine Coutinho
karine@efma.com
Tel: +33 1 4742 6982

EY is a global leader in assurance, tax, transaction and advisory services. The insights and quality services
we deliver help build trust and confidence in the capital markets and in economies the world over. We
develop outstanding leaders who team to deliver on our promises to all of our stakeholders. In so doing, we
play a critical role in building a better working world for our people, for our clients and for our communities.
EY refers to the global organization, and may refer to one or more, of the member firms of Ernst &
Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK
company limited by guarantee, does not provide services to clients. For more information about our
organization, please visit ey.com.

About EYs Global Banking & Capital Markets Center

In todays globally competitive and highly regulated environment, managing risk effectively while
satisfying an array of divergent stakeholders is a key goal of banks and securities firms. EYs Global
Banking & Capital Markets Center brings together a worldwide team of professionals to help you succeed
a team with deep technical experience in providing assurance, tax, transaction and advisory services.
The Center works to anticipate market trends, identify the implications and develop points of view on
relevant sector issues. Ultimately it enables us to help you meet your goals and compete more effectively.
Nicole Allen
nallen@uk.ey.com
Tel: +44 20 7951 9829
Clare Duffy
cduffy@uk.ey.com
Tel: +44 20 7951 9982
19

Looking at the bank from the customers point of view

Looking at the bank from

the customers point of view
October 2014