Picking a New Bank? Try the Most Recommended Banking Brands
Banks are notoriously disliked by customers and the public alike -- but two banks and one credit card company have the greatest number of customers who sing their praises.
Boston Consulting Group (BCG) estimates a typical consumer in developed nations faces 3,000 brand impressions each day. Whether from advertisements, conversations, or simply on products themselves, individuals are inundated by logos, slogans, and more. But despite the constant viewing of adds, it turns out face-to-face recommendations are still the most likely to drive sales.
As a result, BCG created its Brand Advocacy Index (BAI), in which it surveyed more than 32,000 individuals in five different countries to determine which brands customers were most likely to recommend. Unsurprisingly, only 10% of customers in the retail banking category would recommend their bank to others, versus 50% of non-luxury automotive customers. However there were a number of standouts, and the success of one bank in Spain and Germany could mean big things for another bank here in the U.S.
A possible indicator of success
ING held the top spot in both Germany and Spain, with a ranking of 34% and 43%, respectively. While this may seem irrelevant to Americans, it is critical to note that ING operates its ING Direct platform in those counties -- along with Austria, France, and Italy -- and the ING Direct platform was acquired by Capital One , which was completed in February of 2012, and is now CapitalOne 360.
When the acquisition was completed, one of the things Capital One CEO Richard Fairbank highlighted was the supreme loyalty of the ING customers, saying, "ING Direct brings the leading direct-banking franchise in the nation, over 7 million loyal customers who are early digital adopters, and national reach in banking with proven digital capabilities."
Although coming to conclusions based on the successes of other companies is always a tricky endeavor, the reality is, the success of ING Direct in other countries could be a big benefit to Capital One here in the U.S. as it continues to charge into the consumer banking space.
Taking a more direct route -- the brand with the third highest BAI ranking was American Express , with a ranking of 23%. AmEx has long been a favorite of customers, and despite its premium pricing, many people sing its praises, and this is only further evidence of the reality that it is an industry favorite.
This favoritism by consumers is one of the reasons the company was able to increase its cards year over year by 4.8 million accounts, a gain of 5%. This increase in accounts was one of the many contributing factors to American Express seeing its income rise by an astounding 20%.
BCG even noted that the difference between the revenue growth of the highest and the lowest ranked brands was a staggering 27 percentage points, which is all the more reason to see why American Express has been so successful through the years.
Two private companies take the top
At the top of the rankings in the U.S. were Ally and USAA, coming in at 24% and an astounding 44%, respectively. The ranking of Ally is notable for any bank seeking to expand its operations; its customer count rose by 30% year over year.
All of these rankings show clearly that any bank seeking to grow its base of customers first should focus on satisfying its current ones, knowing that if that is done, the customers themselves will in turn become the most profitable and useful advertisements.
The one bank set to benefit from major change
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The article Picking a New Bank? Try the Most Recommended Banking Brands originally appeared on Fool.com.Patrick Morris has no position in any stocks mentioned. The Motley Fool recommends American Express. The Motley Fool owns shares of Capital One Financial. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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