Customer Trust Was Weak Across US Financial Services Brands In 2022
How well did US financial services firms rank in terms of customers’ trust in 2022?
Our new research reveals the scores and rankings of 54 US brands across auto and home insurance, banking, credit card issuers, and investment firms, analyzed as part of Forrester’s US Financial Services Trust Index, 2022.
Overall, customer trust was relatively weak in US financial services firms in 2022. Only 2% of brands fell into the “strong” category, and 57% were considered “weak.” Inflation and market volatility were likely impacting customers’ sentiment, but more critically, it seems that many financial services firms do not understand what drives trust, and efforts to earn trust may be misplaced.
Why does trust matter? When customer trust is strong, financial services firms reap financial, competitive, and reputational benefits, enabling them to expand and extend customer relationships. When it is weak, they lose those benefits and have to fight harder to win business.
In analyzing customers’ perceptions about US financial services brands in our 2022 survey, we found that:
- Customer trust leaders are also customer experience (CX) leaders. Delivering great customer experiences can help firms earn trust because a customer’s perceptions and experiences accumulate over time to produce trust. So it’s not surprising that the leading firms in Forrester’s FS Customer Trust Index are also leaders for their respective industries in Forrester’s US Customer Experience (CX Index™).
- Insurance customers have the lowest trust in their providers. Relative to the other financial services industries we studied in the US, trust was — on average — lowest among auto and home insurance customers. Insurance held an industry average of 62.7, compared to banks (63.9), credit card issuers (64.9), and investment firms (65.0). In fact, eight out of 12 insurance providers in our trust index fell into the “weak” category for trust. Considering that this industry is built on an expectation that the firm will help its customers through emotionally and financially challenging experiences, weak trust could be restricting revenue opportunities.
- Bank brands have the most disparity in customer trust. In our trust rankings for banks, we saw substantial deviations from the industry average of 63.9. The two brands with the highest customer trust scores in banking also received the second- and third-highest scores across all US financial services brands. At the bottom of the pack, the lowest-ranked bank was 18 points behind the leader. Customers are very discerning when it comes to trusting banks, and this is a major opportunity for high-trust banks to differentiate themselves from the competition.
- Trust in investment firms is high, on average, but few brands excel. With an industry average of 65.0, the investment industry has the highest average trust score for 2022. Yet investment firms are struggling to excel when it comes to trust: None of the 12 brands we analyzed reached the “strong” category, with nine earning “moderate” trust scores and the remainder in the “weak” category. The investment-firm trust leaders were brands with strong financial advisor networks that offer one-to-one personalized advice. Self-directed brokerage firms, however, filled out the bottom of the pack. It seems that when it comes to trust in investment firms, relationships and personalized advice still matter.
- Credit card issuers were mostly undifferentiated. Among the 13 credit card brands that we analyzed, only one scored above the 75-point “strong” trust threshold. The remainder of the field fell within a range of less than nine points, however, indicating that customer trust levels in credit card issuers are more uniform than trust in banks, insurers, or investment firms.
Trust Is Hard To Earn And Easy To Burn — How Forrester Can Help
Trust isn’t abstract — you can earn and strengthen it. Every engagement with a customer is an opportunity to earn, reinforce, or destroy trust in your brand. To earn more trust from their customers, financial services firms must design and execute deliberate trust strategies. But first, they must stop guessing and 1) measure trust in their brand and 2) understand what drives customer trust in it. Although data alone can’t tell business leaders what and how to improve, there are many ways that they can use data to identify opportunities to earn trust and to avoid damaging it.
To see the rankings of all 54 brands in the US FS Trust Index — and a much more detailed analysis of the results by industry — check out our report, The US Financial Services Customer Trust Index Rankings, 2022. To learn more about how these scores were calculated (including descriptions of the seven levers of trust) and how you can use them, read Introducing Forrester’s Financial Services Customer Trust Index.