A  new study has revealed that the majority of banks are failing to fully meet customer needs and maximise sales channel performance.

The Booz Allen 'Striving for growth: Best practices in retail banking sales and service channels' study, which used customer research and mystery shopping to assess 100 banks across 17 countries (including 12 banks in the GCC), looked at what customers want from their banks, how banks are performing and best practices to drive profitable growth. 

Based on the findings of this research, the Booz Allen Revenue Enhancement (BRE) Index was developed, taking into account performance across branches, call centers, online, mobile sales forces and a multi-channel index.

In the GCC, the UAE achieved the highest score, followed by Kuwait and Saudi Arabia.
UAE banks scored the highest in branches, call centres, and multi-channel integration.

Branches are relatively new or refurbished, and have segments sections with specialists that are almost always available to meet customers. UAE banks had the least performance variation among each other compared to banks in other GCC countries.

Kuwaiti banks scored second, even though NBK's branches and call center performance stand out by a wide margin against its peers, with new branch models that have a clear layout, product displays, and well-trained agents.

Saudi Arabia scored third; yet, branches received high scores for their dedicated sections for mass affluent customers in most branches.

Despite technological advances, globally customers still prefer banking in branches - 63 per cent choose to use a branch for purchasing current and savings account products and 54 per cent choose their branch to purchase mortgages, the study revealed.

The preferences of GCC customers are almost identical to the global average. However, branch importance is in relative decline.  For purchasing less complex products, such as credit cards, globally over half would now use an alternative channel with 21 per cent purchasing online and 16 per cent by telephone. 

The situation is inverted in the GCC where 18 per cent of customers prefer purchasing by telephone compared to only 11 per cent who preferred purchasing online.  Globally, online channel usage is rising and is preferred over phone, particularly for simple products and transactions; however, this is taking place at a slower pace in the GCC.

The trend away from the branch is being led by affluent consumers, who tend to be time poor and are 30 per cent more likely to prefer using online services. 

'The branch is declining in importance, but banks are failing to capitalise on the enormous potential of key growth channels such as online and mobile sales forces, because the performance of these channels does not meet customer needs and expectations,' said London-based Booz Allen vice-president Alan Gemes.

Retail banks are performing best in branches and online, but call centers and mobile sales forces do not meet key requirements.  Across all channels there is a significant difference between the performance of the best banks, which show near excellent service, and the rest of the pack. 

The top performing GCC banks achieved the highest scores at near the global average, across most channels; whereas, the remaining banks had a wide performance variation across the various channels.  

The study found that the need for differentiated offerings for affluent customers was a common theme across all channels.  This is particularly important for the GCC where differentiation is limited to branches.

Banks still need to get the basics right in branches - privacy, staff knowledgeable about products, query resolution and waiting times are the most important criteria for customers in branches.

This is particularly relevant for GCC banks<