OREANDA-NEWS. December 10, 2009. PricewaterhouseCoopers and Senteo present “Customer Experience Index 2009: How are retail banks overcoming the financial storm?”, a consecutive review of the Russian retail banking sector. According to the review, customer experience remains a critical part of protecting against price sensitivity – despite the economic crisis, reported the press-centre of PwC.

The 2009 Customer Experience Index is made up of 38 retail banks in Moscow. These are the largest institutions in terms of assets, individual deposits and individual loans. The banks’ performance was rated on the basis of the following five elements of customer experience: Brand, Communication, Environment, Offering and Culture. This is the only professional original research undertaken with respect to the retail banking market from the point of view of retail clients.

This year has demonstrated a shift in product strategy that reflects the current tough conditions of limited financing. In these circumstances, Customer Experience is an unstable beast, since people’s moods constantly change and customers are in the process of both adjusting to these changes and making various lifestyle adjustments.

During these trying economic times, foreign banks or subsidiaries performed quite well, with many of them being placed in top positions. Apart from Western banks, government-owned banks and some larger privately-owned banks also enjoyed a significant inflow of depositors.

This year’s overall customer experience index is 3.41, which represents a 0.03 improvement on the figure for 2008. Compared with the previous year, banks have improved in the areas of Brand (3.4)[1], Communication (3.5) and Offering (3.35) and improved the previous year’s score. This suggests that they are seeking to improve their image among customers through brand and marketing initiatives. The highest score in this year’s index was 0.2, which was attained in the communications category. However, performances for Environment (3.3) and Culture (3.48) suffered setbacks.

The greatest level of growth was recorded in Communications, which witnesses a 0.20 score increase. This may be attributed to the fact that this year’s crisis situation required a greater focus on Communications as a way to control the mood of customers and to deliver key messages.

The other notable growth trend was observed in Offering, which saw an increase from 3.31 to 3.35. Banks had to restructure their offering to reflect the present situation, and took this opportunity to introduce new banking products. This approach was also observed in the nature of bank offerings, whereby deposit-based products enjoyed more sophistication, functionality and flexibility, while credit-based products were made more restrictive and costly.

In this year’s Index, the average score for Brand is 3.40, which is a slight improvement on last year’s average score of 3.37 (compared to the same banks).

Leading banks seek to create a distinctive, well-designed and attractive brand which is easily recognisable. Many such banks have a strong brand policy which is consistently reflected in the design of premises and marketing materials, as well as corporate dress style.

Compared to 2008 study results (average score 3.64), this year’s average performance in the Culture category has dropped to 3.48; however, certain banks deserve special recognition in this area. Poor performance in Culture not only adversely affects sales and services, but also damages the bank’s reputation and, finally, impacts customer loyalty and retention.

The overall average score attained in the Environment category is 3.30, compared to last year’s 3.32. A number of banks still lack proper space planning at the entrances to branches. However, bank branch environments are extremely important, since they represent the main place of interaction with customers. 

“I'd like to view the present financial crisis as a unique opportunity to re-focus the business more towards the customer. This is, actually, the best time to display the kind of customer experience that will undoubtedly make a difference. Because of the crisis, regular banking customers have gone through a lot in the recent 12–16 months; they will certainly appreciate better service, more attractive financial offerings and personal attention. The alternative—of doing nothing—is simply not enough. Once the crisis is over, there will be another wave of customer migrations between banks. Customer loyalty is key! I think that banks in Russia are beginning to realise that now”.—Michael Ruckman, Founder and President, Senteo GmbH.  

Chris Barrett, Partner, PwC Russia and CEE Financial Services Advisory Leader, commented:

The crisis has obviously led to reconsideration of all aspects of banking operations. Banks were forced to conduct extensive internal reviews and implement reorganisation projects in order to achieve positive results.

“While it is early to say what the exact outcomes will be of the present economic crisis, it is evident that the retail banking environment in Russia has experienced great changes in comparison to the last few years.

“Customers are in the process of adjusting to changes and making various lifestyle adjustments, and so too are banks. Besides portraying security and professionalism—which are all-important—banks also began to stress the importance of their commitment and relationship with customers.”

Top five banks of the 2009 Customer Experience Index:
Alfa Bank
Raiffeisenbank
UniCredit Bank
VTB 24
BSGV.