Advocacy the way forward?
(21 February 2011 – Australia) Banking research house East & Partners has added significant new core content to its long running Business Banking Sentiment Index (BBSI) program, now known as The Advocacy Monitor (TAM), as the traditional driver of customer satisfaction can no longer be relied upon as the key predictor of business banking performance measures such as market share, wallet share and cross sell performance independently.
Businesses are now reporting less intention to move from their business bank,
due to credit access and perceived lack of choice, and more intention to
purchase new product, despite satisfaction scores with their banks falling to
new lows. This has created a new paradox not seen before in Australia’s business
banking market.
Advocacy has become a more valuable measure of likely customer engagement and relationship strength with their banks, especially in combination with other existing East measures of customer-bank empathy, bank loyalty experiences, contact frequency, proactiveness of bank engagement, mind share and advertising recognition.
Paul Dowling, East & Partners’ principal analyst, says that "We have seen much stronger correlation develop post GFC between the sentiment measures East has traditionally tracked as a way of predicting buying intentions and customer advocacy amongst business customers."
"This enhanced research response is about more closely monitoring the lead effects that customer sentiments toward their banks have in driving advocacy and thence to customer engagement and buying. These drivers intuitively connect much more strongly with what we’re seeing in real world customer behaviour than whether those customers are ‘satisfied’ or not."
The first release of the firm’s enhanced Advocacy Monitor shows that the number of times a bank or relationship manager was actually advocated in the past two months was, on average only 0.34 times by micro businesses. Businesses in the mid-corporate segment by contrast reported advocating their bank or RM on average more than double that of the micro segment.
About East & Partners’ Business Banking Advocacy Monitor
The East & Partners’ Business Banking Advocacy Monitor is a bi-monthly Index of business customer advocacy and sentiment towards banks, based on interviews conducted Australia-wide with a structured sample of +/- 775 companies turning over A$1 to 100 million per annum, some 4,800 direct interviews with business banking customers annually. The Index provides a monitor of several key drivers of customer engagement behaviour with their banks including advocacy, detraction, empathy, satisfaction, loyalty and mind share.
For more information please contact:
Kimberley Burgess
Client Communications
East & Partners
t: 02 9004 7848
m: 0405 250 796
e: kimberley.b@eastandpartners.com
TABLE 1
Average Advocacy Score by Bank
10 (would not recommend) to 100 (would recommend)
TABLE 2
Number of Times Bank or Relationship Manager Advocated in Past Two Months, by State
Average Score
TABLE 3
Most Important Driver Encouraging Advocating Primary Bank – January 2011
% of Respondents
Advocacy has become a more valuable measure of likely customer engagement and relationship strength with their banks, especially in combination with other existing East measures of customer-bank empathy, bank loyalty experiences, contact frequency, proactiveness of bank engagement, mind share and advertising recognition.
Paul Dowling, East & Partners’ principal analyst, says that "We have seen much stronger correlation develop post GFC between the sentiment measures East has traditionally tracked as a way of predicting buying intentions and customer advocacy amongst business customers."
"This enhanced research response is about more closely monitoring the lead effects that customer sentiments toward their banks have in driving advocacy and thence to customer engagement and buying. These drivers intuitively connect much more strongly with what we’re seeing in real world customer behaviour than whether those customers are ‘satisfied’ or not."
The first release of the firm’s enhanced Advocacy Monitor shows that the number of times a bank or relationship manager was actually advocated in the past two months was, on average only 0.34 times by micro businesses. Businesses in the mid-corporate segment by contrast reported advocating their bank or RM on average more than double that of the micro segment.
About East & Partners’ Business Banking Advocacy Monitor
The East & Partners’ Business Banking Advocacy Monitor is a bi-monthly Index of business customer advocacy and sentiment towards banks, based on interviews conducted Australia-wide with a structured sample of +/- 775 companies turning over A$1 to 100 million per annum, some 4,800 direct interviews with business banking customers annually. The Index provides a monitor of several key drivers of customer engagement behaviour with their banks including advocacy, detraction, empathy, satisfaction, loyalty and mind share.
For more information please contact:
Kimberley Burgess
Client Communications
East & Partners
t: 02 9004 7848
m: 0405 250 796
e: kimberley.b@eastandpartners.com
TABLE 1
Average Advocacy Score by Bank
10 (would not recommend) to 100 (would recommend)
| Bank |
January 2011 (N: 790) |
| ANZ | 14.8 |
| BOQ | 56.5 |
| BWA | 24.0 |
| CBA | 11.0 |
| CITI | 15.0 |
| HSBC | 45.1 |
| NAB | 36.0 |
| SGB | 36.6 |
| SUN | 17.0 |
| WBC | 14.1 |
| OTHER | 18.2 |
| TOTAL | 23.1 |
TABLE 2
Number of Times Bank or Relationship Manager Advocated in Past Two Months, by State
Average Score
| State |
January 2011 (N: 790) |
| NSW | 0.39 |
| VIC | 0.48 |
| QLD | 0.91 |
| OTHER | 0.50 |
| TOTAL | 0.51 |
TABLE 3
Most Important Driver Encouraging Advocating Primary Bank – January 2011
% of Respondents
| Product |
January 2011 (N: 790) |
| Product features and performance | 8.5 |
| Service level experienced | 20.4 |
| Closeness of your relationship manager | 6.5 |
| Pricing | 15.1 |
| Responsiveness of the bank | 12.9 |
| Your bank being proactive on issues | 9.2 |
| Availability and ease of accessing credit | 24.4 |
| Other | 0.8 |
| TOTAL | 100.0 |
Note: Micro Business = $1-5m, SME = $5-20m, Mid-Corporate = $20-100m turnover
enterprises
Source: East & Partners "The Advocacy Monitor" – January 2011
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