The satisfaction level of personal banking customers in May increased by 0.1% points (to 82.9%) from April, equal to the 20 year high. However the satisfaction of age groups differs considerably, with the lowest satisfaction (80%) being the important 35 to 59 group which accounts for 56.3% of total financial footings in the market. The most satisfied segment is the 70+ age group (88.8%) which accounts for only 10.8% of the total market value.
These are the latest findings from Roy Morgan’s Single Source survey of over 50,000 people pa.
CBA retains top spot among big four but “other banks” well ahead
Competition among the big four banks for top ranking remained close, with the CBA the leader in overall satisfaction on 82.5%. In terms of MFI (main financial institution) customer rankings, Westpac retains top position with 84.2%, closely followed by CBA (84.1%), NAB (83.6%) and ANZ (82.0%).
Despite the improvement in satisfaction by the big four over the last 12 months (up 1.0% points), the other banks have retained a big lead, with the mutual banks increasing satisfaction by 3.0% points to 92.0%. Teachers Mutual Bank is currently the best performing bank overall with 94.4% satisfaction.
Consumer banking satisfaction
Source: Roy Morgan Research Consumer Banking Satisfaction Report, May 2015, average 6-month sample n=25,646.
Among the big four, Westpac was the most improved over the last 12 months (up 2.3% points), followed by the NAB (up 1.1% points), with CBA and ANZ both up 0.5% points. The housing loan customers of the big four appear to be the main driver of the improvement in satisfaction with an increase of 2.8% points, compared to other customers with a gain of only 0.5% points.
Older and younger customers the most satisfied
In the six months to May, the highest satisfaction for banks’ personal customers was among the 70+ age group with 88.8%, followed by the 14 to 21 year group (87.0%). These two age groups have shown the highest satisfaction of all age groups over the last five years. In terms of value however, these two high rating groups account for only 11.5% of the market’s total financial footings or value despite making up 24.2% of customers.
Consumer banking satisfaction by age: trended
Source: Roy Morgan Research Consumer Banking Satisfaction Report, May 2015, Average 6 month sample n = 25,646
The lowest levels of satisfaction were in the 35 to 59 age group (80.0%), the 60 to 69 segment (83.7%) and those aged between 22 and 34 (82.9%). Together, these three segments account for 88.5% of total market value and 75.8% of customers.
“Other banks” lead the big four for customer satisfaction in most age groups
Among the big four banks, the CBA leads in satisfaction within the younger age groups (14 to 34) but falls behind the NAB in the important 35 to 59 segment, and behind Westpac and ANZ in the 60 to 69 age group. The ANZ is ranked fourth in all age groups up to 59 years, but performs better in both of the older age segments (60 + ). Westpac performs well in all age groups and leads the big four in the 60 to 69 segment.
Consumer banking satisfaction by age: Big Four /other banks
Source: Roy Morgan Research Single Source (Australia) December 2014 - May 2015, n = 24,779
The average satisfaction levels of the banks outside of the big four (“other banks”) are higher than each of the majors for all age groups except the 22 to 34 group, where they are narrowly beaten by CBA (84.6 % to 84.2%). The other banks’ greatest lead over the big four is in the 60 to 69 age group, where their satisfaction is 89.2% compared to the best of the majors (Westpac) with 82.5%.
Norman Morris, Industry Communications Director, Roy Morgan Research says:
“Consumers overall have record high levels of satisfaction with their banks but there is some variation between age groups. Over the last five years, the 70+ age group has consistently shown the highest satisfaction levels overall and across each of the four major banks. This segment has the highest usage of branches and although they are making increasing use of internet banking, they obviously prefer things to stay much the same. Having very few mortgages is another factor to make them a little more relaxed when dealing with their bank, but low deposit rates are likely to begin having a negative impact. It is important for banks to make sure this group remains satisfied because their average level of financial footings is around $170,000.
“In contrast to the 70+ group, the 35 to 59 segment have clearly had the lowest satisfaction levels of all age groups for the last five years or more. Although this group accounts for nearly 60% of the value of the financial services market, their relatively low satisfaction level clearly indicates that banks need to pay them more attention and put more effort into retaining and attracting more of them. With the average value of their financial services being around a quarter of a million, this is an important segment to attract.
“With increased attention being paid by banks to advocacy it is worth noting the likelihood of the different age groups recommending their bank to others. The over 70s are the most likely to recommend their bank, with 61.8% being “very likely” to do so, well ahead of those in the 35 to 59 segment, at only 47.1%.
“Although the 14 to 21 year age group has the lowest level of financial footings, they have the second highest level of satisfaction and advocacy. This makes them a worthwhile challenge to keep happy as they move into other life stages where they become more valuable to banks.”
Roy Morgan Research
Roy Morgan Research is Australia's best known and longest established market research and public opinion survey company. Roy Morgan Single Source is thorough, accurate, and provides comprehensive, directly applicable information about current and future customers. It is unique in that it directs all the questions to each individual from a base survey sample of around 55,000 interviews in Australia and 15,000 interviews in New Zealand annually - the largest Single Source databases in the world. The questions asked relate to lifestyle and attitudes, media consumption habits (including TV, radio, newspapers, magazines, cinema, catalogues, pay TV and the Internet), brand and product usage, purchase intentions, retail visitations, service provider preferences, financial information and recreation and leisure activities. This lead product is supported by a nationally networked, consultancy-orientated market research capability.
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