Catalyst FCS Trust In Banking

Putting the “trust” back in

BANK&TRUST.
Financial Communications Society Luncheon
September 24, 2009

CASUAL OBSERVATION:
Marketers - from many industries - are spending money talking
about “trust.”

Airlines.
Insurance.
Investments.
And of course... banks.

435 7th Ave, 11th Floor / New York, NY 10001 / 212.243.7777 www.catalystnyc.com

Such as...

New Zealand Airlines Charles Schwab Sovereign Bank

Ally Bank Geico Sun Trust


Is it working?
We asked:
Are consumers as concerned with “trust” as corporate America
(banks in particular) seems to believe?

What does “trust” actually mean in this context - and is it important?

How do users interpret online content from banks? Does it affect
their feelings about their financial institutions?

How can financial institutions use the online channel to establish
credibility with their customers - and potential customers?


TWO PART

STUDY
Quantitative Qualitative
high level assessment of deeper insight into WHY
WHAT people think about specific bank websites are
banks and trust issues effective, or not, in building trust


Quantitative: What we learned
Results were surprising - and more nuanced than anticipated.

80% rarely think about
which bank they use
don't believe anything

do not think their
44% they see in banking ads
or websites
66% banks care about
their interests
"sometimes" believe

don't think their
49% what they see in banking
ads or websites
56% banks care about
them at all


When asked
"Can you name a bank you can trust?"

40% answered with some variation of

“no.”

But it gets surprising:

71% reported that they do not trust banks any less than they did 18
months ago.

Only 36% said that when considering a bank, "security" and
"safety" are the main decision drivers.

(The leader was "customer service," at 52% by the way.)


That’s the “what.”
Let’s talk about “why?”

14 lucky consumers came in to chat.

We looked at 3 categories of banks.


Who we studied:

“The Establishment” Wells Fargo
Bank of America

“The Brand Extension” E-Trade Bank

“The Challengers” Ally Bank
Redneck Bank


What was on the menu?
• The users did not know the intent of the study

• "Assume that you have re-located to a new part of the country and
have to find a new bank."

• We gave users the URLs of the banks mentioned previously and asked
to explore them.

• We eye-tracked their experiences, and then asked them to walk us
through what they were thinking and what they were doing with each
click.

• In the process, we focused our questions around issues of "trust."


What we learned:
“Trust” did not resonate as much as expected

Most thought “FDIC Insured” = “money is safe” (all banks were
viewed as safe)

Other words were mentioned as alternatives to “trust”:
• Credibility
• Dependability
• Honesty
• Reliability


People’s thoughts on: trust
• Will I be treated fairly?
• WIll I be valued?
• Identity theft - am I safe?
• What does a bank do in the community?
• How are its business practices? Is it scandal free?
• How complex are terms & conditions? How much fine print?
• Will they suggest services appropriate to me, or just try to sell me things?
• Is there a Chinese wall from investment banking arm?
• Does it have a track record of responsible lending practices?
• Are bonuses for bank executives “coming out of my money?”


People’s thoughts on: banking
Still Standing
People felt that if a bank is still standing, it’s safe.

Not a lot of perceived differentiation
Common sentiment: “Most banks are pretty much the same.”

Not much has changed
“Current climate has not changed my view of banking.”


People’s thoughts on: communications
More “show” less “tell”
Users agreed that they want to be shown, not told, how a bank stands by its
customers (customer service) and community (e.g. post-Katrina, what did a
bank do to help customers affected?)
“New” is good... to a point
People value product innovation but don’t trust “too good to be true” offers.
Reference check:
“Have they been around? Do I know people who use them? Could I ask
THEM if they have good service?”(social media might enable the entire
customer base to be a potential reference.)
Change the relationship, not the conversation
Traditional media tactics won’t work online
When the user is one click away from learning more, claims have to be valid.

Credibility
vs Innovation

It appears that the longer a
bank has been in business, Wells Fargo /
Bank of America
the less time that bank needs
to spend establishing its
credibility.
Perceived
E-Trade
“Track
On the other side of the Bank
Record”
spectrum, the newer a
banking institution is, the
more users are dubious of
"new" or "innovative" Redneck
Bank / Ally
products, services, or offers. Bank

What customers want to hear:
About the institution New Products


The Details:


• Very positive response to "Keep the change" offer online
• Liked the idea that it was an offer that seemed to add value
• Didn't seem "too good to be true"


• Very positive response to online chat offering
• Multiple users responded that it appeared precisely when they were
confused about something


• Users felt that B of A and Wells Fargo were both very forthcoming with
information, beyond the point of what they expected
• Users applauded how informative the sites were, but also thought it was
overkill, as their history & track record in and of themselves made them
"credible"


Ironically, while people were consistently impressed by their "stability," they
were not moved or impressed enough to view these banks as any different
than any other bank - the sites served to reinforce notions of stability but
didn't differentiate them in any way.


• Users were very intrigued by the "newness"
• They all knew of E-Trade (and thus believed E-Trade to be a credible
company) but were unaware that E-Trade offered personal banking.


The general impression was that E-Trade Bank did a good job of
straddling the line of "credible" (because of E-Trade's name recognition)
and “new” (because it was a new offering).


However, upon further examination - specifically, E-Trade's claim that there
would never be any ATM fees of any kind struck people as "too good to be
true."


The disclaimer that "We will not charge you a fee for withdrawing funds
from any ATM nationwide, but the owner/operator of the ATM may" left a
very negative impression among users.

The additional point that “Max Rate Checking Customers” would also be
excluded seemed to add salt to the wounds of those who didn’t have
$50,000 to put into checking.


No one had any real knowledge of Ally Bank.


People were very impressed by the "customer service"
link that stated what the wait time would be to speak with
someone live.


Unlike Bank of America, people were annoyed by Ally's chat window pop
up - they found it intrusive, haphazard, and "ad-like."


The graphs comparing their rates to other banks was initially viewed in a
very positive light, as the first chart compared Ally to 6 other institutions.


However, the next graph compared Ally to only ONE other institution,
which raised eyebrows with some who felt that showing fewer competitors
meant that Ally was trying to hide something.


People thought the site was too "light on content" which would have been
fine if they knew who Ally was, but because they had no brand awareness
they found it to be "flimsy."


While the design of the site was viewed as "attractive", it was also found to
be "not bank-like" - one user compared it to a pharmaceutical website.


Doing things differently actually raised several suspicions:
“I’m suspicious of someone who says it’s a CD but you can take your money out. It’s re-defining
what a CD IS.”

“They’re doing things differently, which makes you think about what are you getting and what
are you giving up?”


Redneck was an interesting case study - because of the tone, language, and
positioning, literally everyone spent significant time on the site, and called it
"memorable," "interesting," etc.


However, not one person thought it was a real website for a real bank
- they all assumed it was a joke.


• As a marketing tactic the site served to create recall; however, it was not
favorable.
• Some people said that the constant references to being "trust worthy"
made them seem less trust worthy; several people said that they didn't
think this sort of humor was appropriate for a bank.
• As far as the site experience itself went, people thought it looked flimsy,
and "unsafe." Additionally, they found it confusing and distracting.


• Finally, those users who clicked the link to "bankin’ skool" were surprised
to see a secondary site that was completely devoid of the identity on the
initial site.
• That, in conjunction with their "traditional" language on identity theft
and terms & conditions, left people feeling unsure as to how sincere this
positioning actually is.


Wrapping Up
Banks viewed as "credible" have more room to offer "new" and
"innovative" services; when the credibility as an institution has been
established, users are more interested in how that institution is
different from its competition.

But “talk” is not enough. Bank websites need to back up claims
with real information about how customers are treated. Change the
relationship, not just the conversation.

Unknown banks offering new services are perceived somehow
trying to "pull one over" on the consumers, or worse: simply not a
credible bank.


Thank
you.

Catalyst FCS Trust In Banking

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