J.D. Power Observation: Bank VIP Finance
On August 4, 2017, whether the business model of the retail bank in Shanghai is favored by customers is actually to see whether it is more in line with customers' consumption habits. In other words, whether a bank's business model and services can meet its financial needs in the target customer's life scene is the key factor in deciding whether a bank will be favored by customers. Under the impact of new forms such as Internet finance and third-party wealth management companies, how to retain "VIP clients" is one of the issues that the banking industry deserves special attention at this stage.
JD Power (Jun Di) , a market research organization known for its "professional consumer satisfaction assessment" , recently released the 2017 China Retail Bank Satisfaction Study (RBSS) . The study shows that the current potential churn rate of VIP customers of Chinese retail banks (interviewed customers who have VIP accounts in the banks they evaluate) is 18%. The loss of potential VIP customers includes two levels: one is that customers are transferred from their own banks to other banks, and the other is that customer assets are decreasing. Although VIP customers account for a small proportion, they have a decisive effect on the performance of retail banks. Taking China Merchants Bank as an example, the number of VIP customers accounted for 2.1%, but the VIP customer management accounted for 82.1%. VIP customers of China CITIC Bank accounted for only 0.8%, but VIP customer management accounted for 69.9%.
The JD Power 2017 China Retail Bank Satisfaction Study (RBSS) is based on the feedback of 11,585 retail banking customers in 37 cities across the country and covers 24 banks that carry out retail banking business in China. The data collection work was carried out from March to May 2017. Bank of Communications (848 points) ranked first in customer satisfaction for the fourth consecutive year, and Minsheng Bank, Ping An Bank and HSBC ranked second (834 points).
Xue Min, general manager of JD Power (Jun Di) China Financial and Service Industry Division, pointed out: "The problem of churn of VIP customers in retail banks has been more serious. Our research shows that the churn rate increased slightly from 2017 to 2016 16% rose to 18%. While banks are striving to expand their business and gain new customers, they also urgently need to pay attention to and address the problem of loss of VIP customers. "
JD Power 2017 China Retail Bank Satisfaction Study (RBSS) shows that the implementation rate of key links of financial managers is lower than that of lobby managers and tellers
Although major banks will mention "exclusive financial advisers" in their slogans, this should not stop at a slogan. JD Power research shows that among VIP customers, less than 60% think that they have an “exclusive financial manager”, while VIP customers with an “exclusive financial manager” usually have a higher willingness to increase the scale of investment and financial management, exceeding 60% (63%) ). At the same time, exclusive wealth managers can establish a reputation among VIP customers. Of the VIP customers with "exclusive wealth managers," nearly half (49%) said they "will definitely recommend the bank they use to others." Xue Min pointed out: "The change needs to start from strengthening the relationship between the financial manager and the VIP customers. Studies have shown that VIP customers who have not been contacted are usually less satisfied."
With the "exclusive financial manager", the second step is to increase their trust in the hearts of VIP customers. JD Power data shows that overall, VIP customers still have low trust in financial managers, and only 23% of VIP customers trust financial managers very much. Many times, VIP customers' "trust" comes from outside the product. "For example, to explain the performance of financial products in the previous year, and organize trainings, lectures and other activities will enhance the trust of VIP customers."
Mobile banking: "stick" your VIP customers
In China, mobile banking is the fastest growing transaction channel in recent years. In 2017, the penetration rate of mobile banking in the Chinese market reached 78%, 26 times that of 2011. As one of the new changes in traditional retail banking, mobile banking is playing a full role. Customers who use mobile banking have more frequent transactions with the bank. In addition to purchasing banking products, customers also use other mobile banking services, such as credit card, investment and financial management, insurance business, etc., and even many comprehensive financial services are launched through mobile banking. Mobile banking can bring a wider customer experience.
At the same time, the customer experience of mobile banking also largely determines customer loyalty. The use of mobile banking has a large positive impact on the overall satisfaction of customers and word of mouth (customer recommendation). From a satisfaction point of view, mobile banking can bring an improvement of 32 points (total score of 1000), and for VIP customers, this improvement is more obvious, reaching 56 points. In the investment and wealth management business, the convenience brought by mobile banking has also greatly promoted customers' investment willingness.
The most important reason why VIP customers' loyalty to banks continues to decrease is the homogeneity and high substitution of financial services provided by banks. Only by continuously optimizing the customer service system, improving customer satisfaction and retaining customers, Can drive the overall growth of the business. Although the churn rate of VIP customers reached 18% in 2017, by improving the satisfaction of VIP customers in both mobile banking and financial managers, it can help retail banks retain some “VIP customers”.
JD Power 2017 China Retail Bank Satisfaction Study ( RBSS ) shows that mobile banking and wealth management managers are the key to VIP customer retention
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