Nationwide Building Society’s reputation rating of 7.3 out of 10 is dovetailed by extremely high recommendation among customers (8.1), making it the UK’s most compelling banking brand. According to research by Brand Finance, the world’s leading independent brand valuation and strategy consultancy, only 2% of Nationwide customers would consider a switch to another bank. Nationwide, which has revitalised its building society heritage, is also the brand that customers of other banks are more likely to switch to.
Banking brands like RBS, Barclays, and Natwest continue making efforts in repairing their reputations and balance sheets– but still have much more work to do. UK customers, in the post-crisis environment, have greater expectations of the banking sector and there is a high degree of dissatisfaction in the performance of the banks, undoubtedly connected to the taxpayer bail-out that followed the crisis, along with constant negative publicity around the banks themselves.
In a move towards online banking, most of the major banking brands have announced UK-wide branch closure programmes, which also plays a role in affecting the brand reputation. Brand Finance research proved that UK customers are eager to embrace alternative providers. Retail-connected bank brands such as M&S Bank, Sainsbury and Tesco all perform relatively well in terms of reputation, suggesting customers are looking to embrace brands seen more as consumer champions. But being ‘new’ may not always be sufficient – brands such as Metro and Virgin Money have only a moderate reputation and are not quite the game-changers they may have aspired to be.
As a result, customer discontent is not entirely reflected in the appetite to switch providers. Big factors are general inertia and the belief that switching banks is not easy in the UK and entails multiple hurdles. Efforts from brands to deliver a seamless seven-day-switching service when changing providers has not always been a success and the lack of a truly exciting alternative may also be a factor.
David Haigh, CEO of Brand Finance, commented: “The UK banking sector as a whole has perception problems to confront and is clearly in a delicate state of transition. UK banking brands are also confronted with ongoing digitalisation and challenger banks providing new, and often dynamic, competition. Some banking brands are adapting well to market evolution, but the future depends on combining new technologies with enhanced customer service, in order to build reputations, strengthen brands and generate greater levels of customer loyalty.”