Loyalty, Inertia and Banks

October 29, 2009

Banks — consumers love to hate them. We just conducted a survey of 550 consumers on their banking habits and analyzed over 100,000 online conversations. The findings were startling.

From our social media analysis, we saw negative sentiment scores exceeding 70% for most bank brands, passionate posts on the evils and unfairness of bank fees, and horror stories on customer service. Comments like the following are typical in the social media space:

PNC’s management should be ashamed of they way they steal and treat their customers. I signed up for PNC banks $101 offer. They immediately started stealing from my account. It was a nightmare I was charged fees for having an account. We never received the $101 from PNC. PNC Customer service is slow and rude. I asked to close the newly opened account and they charged me another $50.

When we measured planned behavior, we got a completely different story. Only 4% of consumers said they planned to change their bank in the next 12 months. So outrage does not translate to behavior change. How do you reconcile the contradiction of perceptions and behavior? The first is to realize that inertia is the overriding characteristic for many categories, including financial services. This inertia is the product of consumers feeling financially illiterate, the pain and complexity of changing banks, and the lack of differentiation among banking brands.

Thus, banking behavior has become automatic. Breaking through inertia to change category behavior is a key issue for many brands. Banks should know it will require more than a toaster to change behavior.

posted by brian newberry October 29, 2009 in rehavior, social media