MARKET INSIGHT REPORT

Good Growth Market Insight Report Barclays

Customers Losing InterestAPRIL 2016

Founded in London over 325 years ago, Barclays operates in over 50 countries and has 48 million customers making it the seventh largest bank in the world and the second largest in the UK, with assets totalling $2.42 trillion.

Following a net loss last year of £394 million,1 a freeze on staff hiring and a programme of branch closure in the UK, three in this month alone,2 the Barclays board must be hoping that they have seen the last of turbulent times.

The new CEO of Barclays UK, Ashok Vaswani, announced in March this year that the bank sees digital technology as “crucial to its future”.3 This market insight report takes a look behind the headlines at the effectiveness of their online execution and draws conclusions as to what steps Mr Vaswani will need to take to ensure they remain a competitive force in banking.

1 http://www.ft.com/cms/s/0/670ca72c-eac3-11e5-888e-2eadd5fbc4a4.html#axzz43AZYckD2

2 http://www.ft.com/cms/s/0/670ca72c-eac3-11e5-888e-2eadd5fbc4a4.html#axzz43AZYckD2

3 http://www.ft.com/cms/s/0/670ca72c-eac3-11e5-888e-2eadd5fbc4a4.html#axzz43AZYckD2

Strategy, Optimisation, Digital Marketing and Customer Relationship Management

Key Points: • Barclays are haemorrhaging customers at a rate greater than any other bank in the UK.4 No longer market leaders,

they have been overtaken by HSBC.

• The continuing branch closure programme suggests that Barclays need to focus on their online execution as a priority if they are to meet retail and business banking needs.

• The Barclays online banking app is regarded as one of the best banking apps on the market, in stark contrast to their website.

• Barclays are failing to utilise on-page analytics tools on their website, meaning that they are missing out on vital insight.

• Compared to their competitors, they do not utilise a wide breadth of analysis to improve their online execution.

• Tostaunchtheoutwardflowofcustomers,theyareinvestingasignificantamountinonlineadvertising,buttheexecution is likely to undermine performance.

The competition Whilst some of the biggest names in the UK banking sector have run into serious difficulties over recent months by the way of significant security breaches and system down-time, Barclays have not experienced this to the same extent. They are however suffering the largest net outflow of customers. The average Briton is more likely to leave their partner than their bank,5 however Barclays seem to be leading the charge to change this.

While RBS was the most complained about bank in 2015 with 20,288 complaints to the financial ombudsman, Barclays were in a close second place with 20,021 complaints.6 In addition to this, Barclays are among the top five banks in the world for the highest amounts paid in fines and compensation over the previous seven years up to 2015, totalling $14 billion.7 All this has made the bank Britain’s least trusted bank according to the financial publication Moneywise.8

The website and online banking portalPartly due to the complexity of the services that Barclays offer, their website is cluttered with a vast array of banking and financial services for both personal and business customers. Smarter segmentation thinking would aid their potential customers and the clarity of their proposition alike.

It is very difficult to navigate around the website and unless the user goes through a search engine, it is difficult to find something specific. This is a symptom of the website’s design and its complexity will have a lot to do with their lack of customer testing. Insight into user behaviour and opinions would give Barclays invaluable insight into how their website could improve.

Barclays online banking offers a competitive service to other banks. However, the online banking portal page suffers from the same affliction as the bank’s main website: it is cluttered and too many products and services are offered at once.

These issues are a symptom of a bigger problem: they are not listening to customers on their website and nor are they watching their interaction with the page. They may well have a significant user testing facility but this is a great example of how user testing can flatter poor performance. It may look good to people testing a website, but not work for people who want to buy from it.

4 http://www.telegraph.co.uk/finance/personalfinance/bank-accounts/11005213/League-table-the-banks-winning-and-losing-customers.html

5 http://www.burleighaccountancy.com/2196/why-are-we-more-likely-to-divorce-than-change-banks/

6 http://www.theguardian.com/money/2015/aug/25/bank-of-scotland-is-most-complained-about-bank-watchdog-reveals

7 http://graphics.thomsonreuters.com/15/bankfines/index.html?utm_source=twitter

8 http://www.thisismoney.co.uk/money/saving/article-2338003/Barclays-steals-RBSs-crown-UKs-trusted-bank.html

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The app The Barclays app has a full five-star rating on the Apple App Store, unmatched by any other bank as of March 2016, Lloyds come a close second. It is clear that the bank have placed significant investment into the app that is reflected in its usability.

Research by Good Growth shows that most “day to day” personal banking tasks can be performed through the app with relative ease and the app’s ability to save payee details for future use makes it very handy when away from a computer or physical branch. Earlier versions of the app did not support the wide range of banking services offered, nor did it feature a virtual Pinsentry device as it does now, meaning the app can be used to generate the code needed to log in to online banking on a computer.

The app’s offering could be improved further by the introduction of cheque scanning recognition.

The app’s lack of support for Barclaycard in previous versions was an issue. Now that this has been resolved, Barclays customers can now access their credit card portal from the same app. This was a significant step in their online portal’s development in order to remain competitive.

The insight approach We analysed the performance of Barclays against some of their biggest competitors in the UK banking sector (Lloyds, HSBC, RBS and Santander) using our insight benchmarks and found the following:

• Barclays drive an impressive amount of traffic against all their competitors bar Lloyds.

• They have one of the least effective paid campaigns beaten by Santander, Lloyds and HSBC who eclipse all the competition.

• Barclays however come top in terms of Google adverts with 96 of their adverts in positions 1-3 on a Google search.

• They employ 23 landing pages in total, the highest among their competitors. Compared with other sectors in e-commerce however, this is a low number of landing pages.

• Barclays are missing vital on-page analytics tools that would significantly increase their insight and understanding of their customers online. HSBC in comparison possess a full toolbox that should be giving them the insight they need. Whether HSBC are using this data to its full advantage is another question.

The Barclays website will be vital in attracting new customers. Source: Getty Images

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Summary• However good their app, the Barclays website will be vital in attracting new customers. The rate at which Barclays

customers are leaving the bank means that their website execution and usability will require significant changes.

• The usability of their app and the customers who are leaving would signal that the app alone isn’t going to keep customers happy.

• In spite of the ‘call me’ button on their app, the telephone service that then proceeds is time-consuming and cumbersome.

• In the rush to find the money for the significant levels of fines that have been issued to Barclays over the past few years, their drive to automation both online and in branch will have saved the bank money but will also have had a negative impact on the bank’s overall service and reputation.

• Going forward, banks need to focus on two key areas: frictionless banking on the move to retain customers and simple segmented product focused websites in order to acquire new customers.

No longer market leaders, Barclays have been overtaken by HSBC..

Source: Getty Images

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