This is a blog post that summarizes a completed project at Research & Marketing Strategies (RMS).

Objective: A financial services client wanted to understand why customers voluntarily closed checking account(s) with bank. The bank also wanted to identify any unmet needs of those former customers and identify where those former customers currently obtain their banking services. The market research was designed to learn why the bank lost those customers, understand its competitive position in the market relative to former customer perceptions and identify potential areas of opportunity. RMS partnered with the bank to design the survey, manage the fieldwork, consult on the findings, developing recommendations and customize action items based on the market research.

Approach: For this particular closed account survey project, RMS utilized its in-house call center (QualiSight) to administer a Quick Pulse Telephone Survey (three to five minutes) among a sampling of the bank’s former retail checking account customers who recently closed their account within the past three months. Based upon the information requested, RMS developed a survey script that included 15 questions. RMS collected a total of 200 completes from across the bank’s geographic service area. Once the fieldwork was completed, RMS prepared a PowerPoint report that included a dashboard of key findings, recommendations and action items and a full deck of question by question results. The bank supplied RMS with former retail checking account customer contact information from which to make the phone calls.

Results: Below is a few key findings derived from the closed account survey research:

• The top reason for closing accounts at the bank within the past three months was because respondents moved out of the area (17 percent) followed by the consolidation of multiple accounts (12 percent) and creation of joint accounts (11 percent).
• Among the customers who closed accounts in the past three months, 54 percent still held an active (other) account with the bank. Although the bank may have lost this particular checking account, which forced the call, it still retained business for more than half of those who closed. Interestingly enough, 36 percent had reopened or planned to reopen a checking account with the bank. Over half of those who closed their checking account (54 percent) had an active checking account with another financial institution (competitor).
• Overall, 82 percent of closed account respondents were highly satisfied with the bank.

The results pointed to the bank and it’s service having little to do with checking account closures. Only 5 percent of respondents reported an issue with the bank’s service as a reason for closing their account. Can your bank or credit union say the same? These cases were detailed for the bank so corrective actions could be taken with customers who were experiencing similar issues. Ultimately, the market research provided the bank with opportunity areas to improve their service and prevent future checking account closures at the bank, or at least the cases that were within its control.

Interestingly enough, while I was directing this project for RMS Analytics, I had switched my checking account from one financial institution to another. While I signed the paperwork to close the account, the service rep never asked me why, if there was anything she could do or even if I’d like to speak with anyone about my account closure. Now, almost a year later, I never received a call or anything similar to obtain my feedback. In fact, my reason did relate to service and specifically, fees. By switching financial institutions, I was able to save $10-$20 each month in ATM usage fees that my old financial institution would charge me for using an out-of-network ATM on top of the terminal fee itself. The ATM locations of my old financial institution were not convenient for me. This is all feedback that was lost in the process because my old financial institution did not use any form of market research to obtain data.

It’s a credit to the banks and credit unions that continually open up the portal of communication with their customers and members through market research.

If you are interested in closed account survey research for your bank or credit union, contact our Business Development Director, Sandy Baker, at SandyB@RMSresults.com or call her at (315) 635-9802 and mention this blog post.