A survey of more than 5,000 US households released today by Forrester Research, Inc. (Nasdaq: FORR) at its ninth annual Finance Forum ranks 34 financial firms on customer advocacy*, a key driver in developing deep customer relationships. This year’s results find that 15 firms’ advocacy ranking dropped 5 percent or more during the last year, while only three — credit unions, E*TRADE, and Wells Fargo — rose by 5 percent or more.
Of the 34 companies ranked, only seven had a majority of their customers rate them high on customer advocacy. Five of them — USAA, credit unions, AAA, State Farm, and Vanguard — are customer-owned. Seven of the bottom eight firms are top retail banks. Rounding out the lowest-ranked providers are the three largest US banks — JPMorgan Chase, Citi, and Bank of America. The next two largest US banks — Wells Fargo and Wachovia — score much better: These two banks have more than twice as many customers rating them high on customer advocacy as do the bottom three banks.
“This year, overall customer advocacy scores are down. Mergers, which tend to disrupt customers’ relationships, have played a role in the declining scores of several brokerages and banks,” said Bill Doyle, vice president and principal analyst at Forrester Research. “On the other hand, companies like E*TRADE and Wells Fargo — which both saw a boost in their ratings — have implemented services that make their customers’ financial dealings easier and more transparent.”
At Forrester’s Finance Forum 2005, running from June 9 to June 10, Forrester analysts and industry leaders from Wachovia, Charles Schwab, E-LOAN, E*TRADE, Ameritrade, JPMorgan Chase, Wells Fargo, and others will share their strategies on how financial services companies can position themselves for cross-sell success by building deeper customer relationships and great customer experiences. The two-day Forum will attract more than 450 business executives to the Sheraton New York Hotel and Towers.
In addition, several categories are expected to receive at least 10 percent of their sector’s sales from the Internet this year, including: computer hardware and software (48 percent); tickets (28 percent); travel (26 percent); books (20 percent); consumer electronics (13 percent); cosmetics and fragrances (12 percent); toys and video games (12 percent); and flowers, cards, and gifts (10 percent). This year, a total of 13 categories will reach the 5-percent penetration point.
Featured speakers include:
- Cecelia S. Sutton, Head of the Retail Bank, Wachovia
- Chris Larsen, Chairman and Founder, E-LOAN
- Janet M. Hawkins, Executive Vice President, Chief Marketing Officer, TD Waterhouse USA
- Anne L. Nelson, Executive Vice President, Chief Marketing Officer, Ameritrade Holding Corporation
- Nicholas A. Utton, Chief Marketing Officer, E*TRADE FINANCIAL
- Bridget van Kralingen, Global and Americas Leader for Financial Services, IBM Business Consulting Services
Forrester’s 2005 customer advocacy ranking can be found in “How Financial Firms Rank On Customer Advocacy.” It is available to WholeView 2™ clients and can be found at www.forrester.com.
* Customer advocacy is defined by Forrester as the perception by customers that a financial provider does what’s best for them, not just what’ class=”newpage” target=”_blank”s best for its bottom line.