John Sinke Regional Marketing Manager, Asia CMC Markets

Trust as a competitive advantage in the Financial Services Industry

The views expressed are mine and not those of CMC Markets.

Bonded Trust

Affective Trust

Functional Trust

Who do I trust?

TRUST CRISIS

Why customers have lost trust in their banks

Global Financial Crisis

Failing banks

Mergers & Acquisitions

Government bail outs High fees

Banker bonuses

Poor customer experience

Global Consumer Banking Survey 2011 (Ernst & Young)

• Huge investments • No bail outs

• Entrepreneurial endeavour • Wealth creation

Poor Level of Service / Product Offering

Trust crisis is not caused by the Great Financial Crisis

Trust has been low for a long time…

• Buying expertise of provider • Ongoing consumer relationship • Less likely to compare products

• Inertia is rife (‘all the same’)

has its roots in the nature of consumer finance products

• Low headline prices

• Poor product and service quality • Competing for first time buyers

Financial Service Providers exploit consumer inertia?

is critical is critical

“If your customers don’t trust you.

You can spend as much

time, effort and money as you want on marketing

campaigns, branding and advertising.

It will barely move the

needle.”

Justin Basini (ex-Capital One)

TRUST

Customer trust Business Performance

Economically Beneficial

Price? Place? Price? People? Promotion?

Trust will soon become the most significant differentiator for online businesses.

Democratisation customer

experience

Transactions Relationships

Social Media

Revolution

T = I + C + P Trustability Intent to act in

customer’s best interest

Competence to do so

Source: Peppers & Rogers Group

Proactively

“Doing the right thing” “Doing things right” “Proactively”

Using insights to proactively engage customers

Customer Intelligence

Customer Feedback

Behavioural Data

Analytics

Branches and contact centre at the centre of trust efforts

Exceptional Support (TRUST)

Voice

SMS

IVR

Social Mobile

Online

Email

Behind every great brand is a great brand experience

“It’s already too

late by the time

you’re doing

customer service.”

“The best

customer service

is if the customer

doesn’t need to

call you, doesn’t

need to talk to you.

It just works.”

“Too many banks hide behind account

terms and conditions”

“You don’t need a points programme;

you just need to answer the phone”

“We prefer customers who fit the

bank’s approach”

“Authenticity is delivering the customer

experience promised”

“Customer experience is not what we

think it is” “It’s what the customer thinks it is”

“Contact centre is ambassador of trust

relationship”

http://discover.firstdirect.com

©2010 CMC Markets

©2010 CMC Markets

©2010 CMC Markets

©2010 CMC Markets

It’s already too late by the time you’re doing customer service

Five Steps: 1. Acknowledge long term value customer 2. Ensure a quality product or service 3. Improve IT / Contact Centre Systems &

Customer Analytics 4. Maintain robust voice of customer feedback 5. Stewardship for customer relationships

Source: Peppers & Rogers Group

TRUST

It’s already too late by the time you’re doing customer service

- Technology/Social Media: - Fuel expectations in trust - Demands transparency

- Economically attractive - Economic benefits over time

Financially not viable?!

Source: Peppers & Rogers Group

http://quiz.extremetrustbook.com/s3/Trustability

TRUST CRISIS

• Customers have lost trust in banks • Trusts crisis linked to nature of consumer finance

• Trust is critical in transaction and relationship

1. Acknowledge long term value customer 2. Ensure quality product or service

3. Improve IT / Contact Centre Systems & Analytics 4. Maintain robust voice of customer feedback

5. Stewardship for customer relationships

COMPETITIVE ADVANTAGE

Thank you!

John Sinke

Twitter: @johnsinke

LinkedIn: sg.linkedin.com/in/johnsinke

Sources: • Global Consumer Banking Survey 2011. A new era of customer expectation by Ernst & Young • Have you earned your customers’ trust? White Paper 2011 by inContact and Peppers & Rogers Group • A confidence crisis? Restoring trust in financial services, by John Springford, The Social Market Foundation, July 2011 • The Bezos doctrine of ruthless pragmatism. By Barney Jopson, Financial Times, 9 July 2012 • The changing face of Asian personal financial services. Kenny Lam and Jatin Pant, McKinsey, September 2011. • Financial report: Domestic banks have more local appeal. Remo Notarianni, Campaign Asia, 3 November 2011 • Financial report: Bank on trust. Matthew Carlton, Campaign Asia, 3 November 2011 • Why should anyone buy from you? Earn customer trust to drive business success, Justin Basini, 2011. • Building trust and loyalty in retail banking: the critical role of customer communications management, White Paper May 2012,

Thunderhead.com • International Banking, Retail renaissance, The Economist, May 2012. • Extreme Trust. Honesty as a competitive advantage, Don Peppers & Martha Rogers, 2012. • The converged lifestyle. Consumers and Convergence 5. KPMG International, December 2011 • Private banking in Asia: going beyond trust and confidence. Singapore Management University, November 2010 • Financial Services, the blame game. Financial Times, 30 September 2012 • The three bitter pills you need to take to restore brand trust. Marketing Week, 20 October 2011. • Time for finance to get ‘back to basics’? Money Marketing, 2 August 2011 • Nick Brien: Marketing now has 5Ps. Campaign Asia, 18 September 2012 • Megabanks lose more consumer trust while community institutions make gains. The Financial Brand.com, 11 September 2012 • The future for finance as expectations are on the rise - Part II. Sara de Dios, 25 July 2012,

http://blog.havasmedia.com/post/27908180732/the-future-for-finance-part-ii • Edelman Trust Barometer, 2012 Annual Global Study • Edelman Trust Barometer, 2012 APAC Results • Edelman trust Barometer. 2012 US Financial Services and Banking Industries • Financial crisis, five years on: trust in banking hits new low. The Guardian, 9 August 2012 • Consumer trust in financial services is underpinned by effective communications., 8 June 2012,

http://www.bitecommunications.com/blog/2012/06/08/consumer-trust-in-financial-services-is-underpinned-by-effective-communications/

• http://smu.edu.sg/knowledge/2012/06/26/private-banking-asia-going-beyond-trust-and-confidence • http://socialmediaopenkitchen.wordpress.com/2012/08/05/banks-and-social-media-do-you-trust-social-banking/ • http://www.mckinsey.com/Features/Leading_in_the_21st_century/larry_fink • http://www.marketingweek.co.uk/trends/can-marketing-overcome-its-trust-issues/4000621.article • Finance Report: Brands fail to connect with Asian consumers. Campaign Asia, 15 October2012 • Understanding Asian Mass Affluents, Fox OneStop Media, October 2012