Online banking and bill payment services are overtaking traditional factors such as physical location in consumer selection and perception of banks according to US market research by Vividence.
The latest Vividence Customer Experience (CE) rankings for the online banking industry found that Bank of America and its lesser-known rival National City provided the best overall online experience to prospects, with a statistical tie for the top spot in the rankings. Chase and Fleet prospects were the least satisfied with their online experience.
For the study, Vividence monitored 2000 prospective customers as they interacted with ten leading banking Web sites.
Close to 50% of consumers in the study said online banking and bill payment services are a very important factor in choosing a bank, while the importance of physical location and ATMs continues to recede (42% stating it as a factor compared to 47% in previous studies).
Despite the importance of the Internet experience, consumers are frustrated with the inadequate instructions and support provided for most online bank applications. One-quarter of all prospects that chose to start the application process did not complete it - "an abysmal record as compared to the completion rate of online applications and registrations in other industries," says Vividence.
Web sites that provide information upfront regarding the length of the application process and information requirements have the highest completion rates. National City, which clearly delineates the requirements upfront, has the most user-friendly application process according to the study, while Washington Mutual has the lowest completion rate.
Consumers voiced other frustrations with bank Web sites, with the average user experiencing a problem every three and a half minutes. Approximately one-in-three (31%) prospects complained that they could not locate customer service options on the site they were visiting and one-in-five (21%) expressed concerns about privacy and security issues.
With ever-present links to its 'Help Centre' and strong FAQs, Wachovia was ranked as providing the best access to customer support, whereas Bank One and Fleet were seen as offering poor service as illustrated by their failure to provide a customer support link on their homepage.
Prospects also reacted poorly to sites that used highly technical or legal language in their privacy statements. Bank of America, Wells Fargo and Chase were the sites most prospects felt managed privacy and security issues the best.
The initial online experience at a particular bank site has a significant influence on the likelihood that a prospect will sign up for additional online services, says Vividence.
Less than half of Wachovia prospects indicated they would also use online bill pay services according to the study, whereas close to 80% of Bank of America prospects indicated they would use such services. The study found that Bank of America benefits from an accessible online bill pay demonstration and clear, persistent messaging about its online bill pay services.
The research indicates that the consumer experience online has a direct effect on brand perception and loyalty. In this latest study, National City received the greatest improvement in its brand perception with just five per cent of prospects reporting a highly favourable opinion of the bank prior to their online experience and 57% doing so after experiencing its Web site.