Below are three case studies to offer insights into our process:
Case Study: Should a Bank Change Its Name?
Research Objectives and Methodology
A community bank was concerned that its name was too generic and didn’t reflect its ties to the region it serves. Given the costs associated with a name change, the bank wanted to understand how much equity it had in its current name, as well as area residents’ perceptions of new names it was considering.
We proposed a combination online and phone survey of area residents, including residents in the bank’s primary and secondary market areas. The survey included both closed-ended and open-ended questions, with the open-ended questions being a key way of delving into the factors driving consumer perceptions, which can be particularly important when contemplating a name change.
- Research Findings
The research found that the region has many competing banks and this bank did not have particularly strong awareness in the community. As is the case in most markets, the large national banks had the highest name recognition, but our client’s name recognition was low even compared with that of other community banks.
The research showed though, that if a resident was aware of this bank, they were very likely to consider it as their top choice when looking for a new bank. This indicated that our client has a positive image among those residents who are familiar with it. In testing specific incentives, we found that specific members of this community were very open to changing banks when offered an appropriate incentive.
When residents were directly asked to compare the old name to possible new names, one potential name tested showed strong indicators of better aligning the bank with the region, and was well received by area residents.
- Recommendations
While the bank was evaluated positively overall and is relatively successful at converting those who are aware of the bank to consider them as a potential bank, their market potential was limited by its low level of name recognition. Based on that and the finding regarding incentives, we recommended they consider implementing specific incentives to gain new customers. This would help both increase their unaided awareness, as well as meet specific needs of their market.
In terms of recommending a name change, we have found historically that people are generally more favorable to a name they’ve heard than a new name, so the fact that a new name had equal preference speaks to the favorability of the new name. Given the lack of equity in the current name, we recommended the bank change its name.
Case Study: What Do Business Owners Desire in Their Banking Relationship?
Research Objectives and Methodology
A well-established commercial bank was interested in evaluating its value proposition and the messaging it used. The bank was a strong member of the community and was known for being a partner its commercial customers could count on. The bank wanted to talk directly to its customers to understand how well it was achieving its mission and how effectively it was aligned with its commercial customers’ current needs.
We conducted both in-depth interviews and focus groups with the bank’s commercial customers. This methodology allowed for deeper discussion to understand how effectively they were meeting their customer’s needs.
- Research Findings
Through the research, we found that the bank’s commercial customers want three main things: they want a bank that values them and pays attention to their business banking needs, one that supports business growth and development, and one that simplifies the banking process to support smooth day-to-day business operations. For the most part, they are not looking for a consultant to advise them on business strategy. They instead are often looking for a resource to troubleshoot specific issues or technical problems, especially for issues where they lack experience or expertise.
The results also showed that customers were worried about the bank’s future growth—that it was growing too big or too quickly and as a result, might not continue to serve their needs in the future. This concern was shared across customers in both the in-depth interviews and the focus groups.
- Recommendations
We recommended the bank take two different approaches. For their current customers, the bank should showcase how they can be a “customer’s partner in business.” This includes making every step of their commercial customer’s experience easier and operating as an extension of their customer’s business.
To acquire new customers, we recommended utilizing their current customers for referrals. People trust other business owners for bank recommendations and the bank should capitalize on that. We also recommended they should emphasize the bank’s presence in the community and continue to focus on ways they can stay engaged with local business, non-profits and other community events.
Case Study: How a bank’s current image can inform their Strategic Plan
Research Objectives and Methodology
A community bank was reassessing its strategic plan and was interested in measuring residents’ awareness and image of the bank and gathering similar information from their current customers. Their main objectives for the survey were learning which banks in their area have top of mind awareness, and which factors are most important in driving consideration and preference of the bank and financial institutions in their community.
Based on their needs, we conducted a 10-minute online survey of residents of the community as well as a subset of the bank’s members.
- Research Findings
Residents had an overall low awareness of and familiarity with our client and of those who were aware, only half said they would consider our client if they needed a new bank. Although other banks in the area, especially large national banks, had higher awareness, those other banks tended to have lower NPS scores.
Because we collected survey responses from both residents of the community as well as current customers of the bank, we were able to compare results between the two groups.
- The median age of their customers was almost 20 years older than the residents of the town.
- Half of residents who use the bank and almost 1 in 4 of their customers only use the bank as their secondary bank.
- Regarding its fee-free ATM network, the bank received a neutral rating from area residents and a decidedly weak rating from its current customers.
- Recommendations
Most consumer journeys begin with awareness. The bank’s low awareness will hamper attempts to grow their consumer customer base, and is likely a factor in the significantly higher median age of their customers. Given the high median age, they need to be aware of the impact that transfers of wealth will have on them as their existing customer base continues to age, and identify ways to appeal to move younger consumers. They also have an opportunity to grow their share of wallet, due to the ratio of their customers and residents who use them as a secondary account. In addition, they have an opportunity to attract current customers of other banks due to residents’ current levels of dissatisfaction with those banks.
Before launching any attempt to capture new customers and increase share of wallet, our client needs to examine barriers to consideration and use, one of the most significant being their poor fee-free ATM network, a key consideration factor for younger residents in this market. We also suggested they emphasize how easy they make the banking experience and showcase their useful and innovative technology.
