Declining Bank Satisfaction Levels Among Small US Businesses
A new report from Aite Group reveals declining satisfaction rates of many ‘Big Four’ and regional bank customers over the last two years, and examines the risks of such declines.
The report analyses the satisfaction rate of US small businesses, defined at those businesses generating less than US$10m in annual revenues. Based on a survey of 283 owners and executives of US small businesses conducted online in July 2009, the report also recommends initiatives that banks can implement to exceed customer expectations and increase the probability of cross-selling success and customer retention.
Despite financial institutions’ increased focus on the small-business customer segment over the last few years, this segment’s overall level of satisfaction with their primary institutions decreased between 2007 and 2009. This is especially true among those that had described themselves as ‘extremely satisfied’ in 2007. The most significant declines in satisfaction were seen in customer ratings of service, online banking application ease-of-use, and financial institutions’ ability to understand the specific needs of their customers.
Among small businesses that are ‘disappointed’ with their financial institutions, 31% stated they ‘definitely’ or ‘probably will’ switch to a new financial institution over the next two years. Thirty-eight percent of disappointed customers bank with Big Four banks, while 41% bank primarily with regional banks.
“While the current economic environment is creating new challenges, financial institutions cannot lose sight of the importance of providing high levels of customer service to their small-business customers,” said Christine Barry, research director with Aite Group and co-author of this report. “In fact, they must strive to delight their customers and exceed their expectations, or risk losing them to competitors. Both financial institutions and technology providers have the power to improve small-business relationships before it’s too late.”