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Consumer Satisfaction with banks at record high, but why are Business Customers lagging so far behind?

Source: Roy Morgan Research Consumer Single Source, November 2013-April 2014, Big Four Banks n=17,203; Roy Morgan Research Business Single Source, November 2013-April 2014, n=4,807. Roy Morgan Research Consumer Banking Satisfaction Report, April 2014; Average 6 monthly sample for Big Four banks (n = 18,302). Roy Morgan Research Business Banking Satisfaction Report, April 2014; Average 6 monthly sample for Big Four banks (n = 4,720).
The satisfaction level of the personal customers of banks reached 82.0% in April, a marginal increase from 81.8% in March, but enough to achieve its highest level in the 18 years since this survey began. The Big Four banks’ personal customers scored 80.7% satisfaction, well above the satisfaction level of their business customers (65.8%). These are the latest findings from the Roy Morgan Research Consumer Single Source survey of over 50,000 people per annum and Business Single Source survey of more than 13,000 business finance decision makers per annum.

Business customers less satisfied

In the six months to April 2014, the CBA shows the highest satisfaction level for personal banking customers with 82.6% and Westpac has the highest satisfaction among business customers with 68.7%.

All four major banks show much lower levels of satisfaction for their business customers compared to their personal customers. The biggest gap is for NAB, where business customers are 17.4% points behind its personal customers, while Westpac has the smallest gap with its business customers 9.9% behind.

Business and Consumer Banking Satisfaction: Big Four Banks

business-consumer-banking-satisfaction

Source: Roy Morgan Research Consumer Single Source, November 2013-April 2014, Big Four Banks n=17,203; Roy Morgan Research Business Single Source, November 2013-April 2014, n=4,807

Personal customer satisfaction at record high

In the six months to April 2014, the CBA maintained its leading position among the Big Four with 82.6% satisfaction, followed by NAB (81.2%), Westpac (78.6%) and ANZ (78.2%). The biggest improver among the major banks over the last month was NAB (up 0.7% points), followed by the ANZ (up 0.6% points), CBA (up 0.3% points) and Westpac (up 0.2%).

Consumer Banking Satisfaction

consumer-banking-sat

Source: Roy Morgan Research Consumer Banking Satisfaction Report, April 2014; Average 6 monthly sample for Big Four banks (n = 18,302).

Over the last 12 months the CBA showed the largest improvement in satisfaction (up 2.1% points) followed by Westpac and NAB (both up 1.9% points) and the ANZ (up 0.6% points). The ANZ, CBA and Westpac showed improved satisfaction largely as a result of their home loan customers increasing their satisfaction on the back of the reductions in home loan rates. Westpac home loan customers showed the biggest improvement (up 4.7% points) over the last 12 months, followed by ANZ and CBA (both up 3.6% points). The NAB’s home loan customers showed a decline in home loan customer satisfaction over the last 12 months (down 1.1% points). All four of the major banks still have lower satisfaction levels among their mortgage customers compared to their non-mortgage customers.

Business customers show some improvement

While consumer banking satisfaction for the big four has continued to increase over the last year (up 1.8% points), business customer satisfaction has improved marginally more (up 2.1% points). In the six months to April 2014, Westpac maintained its lead in Business Customer Satisfaction over the other Big Four with 68.7% satisfaction, followed by CBA and ANZ (both on 65.5%), and NAB (63.8%). ANZ was clearly the biggest improver over the last 12 months (up 6.0% points), followed by Westpac (up 1.8% points), CBA (up 0.8% points) and NAB (0.2% points).

Business Banking Satisfaction

business-banking-sat

Source: Roy Morgan Research Business Banking Satisfaction Report, April 2014; Average 6 monthly sample for Big Four banks (n = 4,720).

Business satisfaction with major products low

Businesses are showing very low satisfaction levels for Transaction/Deposit Accounts, Loans and Relationship Managers/Business Bankers, which is obviously having an impact on the low overall satisfaction levels seen. Westpac has the highest satisfaction level of the Big Four for the three areas shown, in line with its top ranking seen earlier. The NAB scores lowest for Accounts and Relationship Managers, while CBA comes in last for satisfaction with Loans.

Business Satisfaction with Accounts, Loans and Relationship Managers

business-satisfaction-products

Source: Roy Morgan Research Business Single Source, November 2013-April 2014, n=4,807

Norman Morris, Industry Communications Director, Roy Morgan Research, says:

“Satisfaction among banks’ personal customers is at record high levels and is obviously the result of a concerted effort since 2001 when they were at their lowest point. Although this improvement has been seen consistently over a long period, more recent improvements have had a lot to do with low interest rates on home loans and high satisfaction levels and preference for internet banking. For a number of years it appears that banks have had a preference for the relative safety of personal customers and as a result their business customers are being left behind as evidenced by the wide gap in customer satisfaction ratings.

“Recent moves by the major banks to show an increased focus on the business customers obviously stems from a realisation that something needs to be done to attract and retain them to compensate for the reduced prospects for growth in the personal market. Banks currently appear to lack empathy with their business customers who require more attention and understanding. This is evidenced by the fact that these customers rate their banks very poorly on ‘maintaining regular contact’, ‘following developments in the industry’ and having a ‘good understanding of their business’.  Banks recognise the need for personal contact with their business customers, and use business managers to manage the relationship with their clients, but at this stage the satisfaction level with these managers is less than seventy percent for each of the four major banks. This is an area that obviously needs some improvement if overall satisfaction is to increase.

“The relatively low satisfaction among business customers is likely to be impacting negatively on personal customer satisfaction as there is a strong link between the bank used for business and the personal bank for Australia’s two million micro and small business owners.

“The current Financial System Inquiry will need to consider how well the needs of business are being met by the banks in order to ensure that they remain viable and contribute to economic growth. At the present time it appears that there is room for improvement.”

View more information on the Australian Consumer Banking Satisfaction Monthly Report.

View more information on the Australian Business Banking Satisfaction Report.

For comments or more information please contact:

Norman Morris, Industry Communications Director
Telephone: +61 (3) 9224 5172
Mobile: +61 402 014 474
norman.morris@roymorgan.com

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About Roy Morgan Research Consumer Single Source

Roy Morgan Single Source is based on over 50,000 interviews each year and has been designed and engineered to represent the ideal source model. It provides an integrated understanding of consumers; what they are like, what they consume, what they buy, what they think, what they want, what they watch, read and listen to. The overriding benefit of Roy Morgan Single Source is the strategic insights it offers in the ability to link many aspects. Not only can an organisation’s profitable customers be delineated by what they think, do, watch, but so can non customers. Hence brand positioning, product differentiation, merchandising, efficient media planning, market expansion and line extension opportunities can all be considered in the light of the correct understanding of the marketplace.

About Roy Morgan Business Single Source

The Roy Morgan Research business survey covers businesses from every industry, size and locality in Australia. The survey based on over 13,000 business decision makers per annum covers all aspects of business finance so as to be comparable with the well established Roy Morgan Consumer Single Source. Roy Morgan Business Single Source is designed to provide the ideal Business single source model. It not only provides a comprehensive understanding of the business finance market, but also detailed insights into the personal finances of business finance decision makers.

The Roy Morgan Business Survey includes a monthly measure of the level of confidence or outlook for Australian businesses. It looks at how businesses view their own position and prospects, and more broadly how they feel about the direction of the overall economy. The analysis covers all major industry sectors, size of business and location.

About Roy Morgan Research

Roy Morgan Research is the largest independent Australian research company, with offices in each state of Australia, as well as in New Zealand, the United States and the United Kingdom. A full service research organisation specialising in omnibus and syndicated data, Roy Morgan Research has over 70 years’ experience in collecting objective, independent information on consumers.

In Australia, Roy Morgan Research is considered to be the authoritative source of information on financial behaviour, readership, voting intentions and consumer confidence. Roy Morgan Research is a specialist in recontact customised surveys which provide invaluable and effective qualitative and quantitative information regarding customers and target markets.

Margin of Error

The margin of error to be allowed for in any estimate depends mainly on the number of interviews on which it is based. Margin of error gives indications of the likely range within which estimates would be 95% likely to fall, expressed as the number of percentage points above or below the actual estimate. Allowance for design effects (such as stratification and weighting) should be made as appropriate.

Sample Size

Percentage Estimate

40%-60%

25% or 75%

10% or 90%

5% or 95%

5,000

±1.4

±1.2

±0.8

±0.6

7,500

±1.1

±1.0

±0.7

±0.5

10,000

±1.0

±0.9

±0.6

±0.4

20,000

±0.7

±0.6

±0.4

±0.3

50,000

±0.4

±0.4

±0.3

±0.2