Customer expectations rise: financial services pay dearly

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By: Wise Marketer Staff |

Posted on January 13, 2002

Consumers' expectations are increasing. By not keeping up with them, US financial services companies are losing potential profit opportunities of some US$700m per year.

The most important attributes that encourage customers to be loyal to a financial provider are: tailoring products to the customers' needs, providing a personal contact, anticipating the customers' needs, and making the customer feel appreciated. This is revealed by a report published in partnership by LOMA's Customer Service Institute and Peppers and Rogers Group.

One to One in Retail Financial Services analyses the results of two CRM surveys, one of which measured how customers rate financial services institutions on CRM-related issues, and the other of which examines current and developing CRM efforts in over 300 financial institutions. The report also reveals that most consumers (55%) who rate their primary financial institution high on both service quality and CRM attributes say that they are 'very likely' to keep all of their business with one provider. Its content is based on industry and consumer surveys, interviews with industry leaders, case studies that profile financial services companies, and a "User's Guide" on how to calculate individual customer profitability. 

The cost of failure
The failure of financial services providers to keep up with customers' ever increasing expectations regarding personalised, relevant offers and service results in the loss of an estimated US$700m in lost profit opportunities per year.

According to Don Peppers, "Nothing affects consumer loyalty, or the propensity to consolidate accounts, as much as relationship-building activities."

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