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A big challenge for those engaged in retail/consumer banking and financial services is the difficulty in getting bank customers who already have a bank to make a switch to a new brand (or to add their brand to the mix).

By and large, banks are seen by consumers as offering fairly standardized and non-differentiated services, and there is rarely a compelling reason for the consumer to make a switch. That said, retail banks and financial services firms may be pleased to know that about 1 in 10 U.S. adults might be willing to consider a switch. Among 10,451 online U.S. adults asked from October 13 to December 2, 2015, CivicScience found that 7% would be somewhat likely to switch banks in the next three months and 3% said they’re very likely to make a change. Grouping those “very likely” and “somewhat likely” respondents, here are some more insights about them that might provide help in devising marketing and advertising plans:

  • They are 33% more likely than average to have an annual household income over $100,000.
  • They are 61% more likely than average to describe their political leanings as “Conservative.”
  • There is no gender difference relative to the general population.
  • They are more likely than average to be “second screeners” as they are watching shows or movies on TV – meaning they are using a smaller digital device (smartphone, tablet) at the same time they have programming on the TV.

And retail banks shouldn’t feel that convincing a consumer to make the big switch is the only option. Banking “Super-Customers,” or those who conduct their personal banking with more than one institution, make up about one-third of U.S. adults. Furthermore, about 10% of all U.S. adults indicate that they have accounts with three or more banks. These super customers have more money to manage. They are about 30% more likely than average to have an annual household income of $100,000 or higher, and they are over 20% more likely than average to save at least 11% of their monthly income. Those using multiple retail banks are 32% more likely to than average to pay for healthcare insurance themselves. Overall, they make an attractive consumer-base.

But How to Lure New Customers In?
An area for attracting new customers is likely found in the still-increasing practices of online and mobile banking. Online banking today is widely used: 75% of 14,960 online U.S. adults polled by CivicScience from September 1 to November 29, 2015 said they use online banking features at least a little. The “power users” make up 52% who go online for at last half of their retail banking. This number grew by 4% over the same period in 2014.

Banking-practices-table

Banking through one’s mobile device, however, has been slower to catch on among the general public. Our data shows that smartphone usage has increased by about 7% in the past year, to reach a rate that’s now around 68% among U.S. adults (Pew Research Center has near-identical findings). Yet, fewer than half of U.S. adults conduct some of their retail banking through such a device, and only 20% conduct more than half of their retail banking in this way. There is room for growth here! Don’t forget the important stat used earlier: those willing to switch are also “second screeners,” who use their phones or handheld devices while also watching TV. Standard broadcast ads that encourage new ways of banking through the mobile device could encourage impulse account creation.

And while impulsive moves might sound scary to the banking set, one other statistic that came about in our research was about decision-making. Good money managers, those who say they manage their money “very well,” by saving more than 20% of their income, for example, are also 15% more likely than the general population to say that they typically make decisions quickly and confidently.

For banks looking to attract switchers (or even those who already have accounts but might open another one), trumping up tech-enabled convenience features, as well as any services that can help them better manage their finances, may be smart marketing.

About Laura Albert: Laura Albert is a market insights analyst at CivicScience, where she helps with the collection and analysis of real-time consumer insights data. She works with CivicScience business partners and the news media. She can be reached at: lalbert@civicscience.com

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James W. Gabberty

Gabberty is a professor of information systems at Pace University in New York City. An alumnus of the Massachusetts Institute of Technology and New York University Polytechnic Institute, he has served as an expert witness in telecommunication and information security at the federal and state levels and holds numerous certifications from SANS & ISACA.

Zachary Ehrlich

25-year-old writer, and as a native San Franciscan, I am unreasonably loyal to Bank of America, if only for their superhero-like origin story, involving the 1906 earthquake and Italian fruit vendors.

Marisa Mann

Marisa Mann brings over 15 years of experience in consulting and financial services industries to the Solstice team, working on large scale enterprise initiatives across many technologies, including specializing in the digital space – Internet and mobile. Mann is passionate about mobile and the endless possibilities for the enterprise, delivering business value through strong brand recognition and driving to excellence in the consumer experience. Prior to Solstice, Mann worked at JP Morgan Chase, Diamond Management and Technology Consultants, Washington Mutual, Inc, and Accenture.

Brad Strothkamp

http://www.forrester.com/rb/analyst/brad_strothkamp