permanent tsb switching index september 2014

2014

September 2014

permanent tsb

executive summary

The permanent tsb research continues to highlight the lack of mobility in the banking sector

relative to previous research conducted in April, January, and last October. Only 1-in-10 (9%)

banking customers have switched in the past 12 months, falling behind the Health Insurance

category (16%) and well behind the car insurance sector (36%).

Relative to the previous waves of research, banking customers are still experiencing high levels

of frustration, they are also conscious of increasing prices, negative media and news commentary. The same trend can also be seen in the Health Insurance sector as customers are

generally dissatisfied.

The permanent tsb Switching Index figures have remained relatively steady since October 2013.

While the banking score remained stable at 48, it is tied at the bottom as the lowest ranking score with Health Insurance (also at 48).

While bank switchers’ attitudes continue to be positive, removing perceived barriers and

increasing options in the sector will be key to generating movement.

permanent tsb

switching index

The permanent tsb Switching Index compares and

contrasts consumer loyalty across a range of

household necessities and explores the reasons

why consumers switch in each area, as well as their

overall attitudes to spending and saving. The

sectors covered are electricity, broadband, car

insurance, mobile phone providers and banking.

Health insurance was added as a new sector in

April 2014.

Consumers were asked questions about their

satisfaction or frustration with their current provider,

the range of choice available in each category,

positive and negative sentiment about a provider or

a sector, whether charges are rising or falling and

the likelihood of them changing provider in the

next 12 months.

Research was conducted in October 2013, January

2014, April 2014, and again in July 2014.

Section 1: Attitudes towards providers What consumers really think

Section 2: Switching and prices Perception versus reality

Section 3: Switching Index Are we prepared to make the move

Section 4: Financial switching The savvy consumer

Section 5: Financial management The day to day

Appendix: Research Methodology

Buzz – are people hearing good things or bad things about providers?

Mobile Phone

(Base: All with decision making responsibility)

Section 1

The number of people hearing bad things in the Mobile Phone sector has remained steady over the course of the year at 1-in-10.

4441 40 41

45

5149 49

118

11 10

0

20

40

60

Oct '13 (N=920) Jan '14 (N=933) April '14 (N=929) Jul '14 (N=907)

Good things Neither/nor Bad things


Electricity


Section 1

In Electricity, the number of people reporting bad things in media/news has fallen since October from 18% to 10% in July 2014 - although this could be related to time of year as electricity costs are particularly important later in the year.

28 29 2830

5459 58

60

18

1113

10

0

20

40

60

80




Bank


Section 1

While negative ‘buzz’ is highest in the Banking sector this is gradually decreasing, down 7 percentage points from October 2013. However, the number of people hearing good things is still below the numbers hearing bad things.

22 2123 22

46 48 47

53

3230 29

25

0

20

40

60




Car Insurance


Section 1

The number of people hearing bad things in the car insurance space is lower than for any other category at just 6% in July 2014.

36

3133 33

58 62 62 61

6 7 6 6

0

20

40

60

80




Broadband


Section 1

A high proportion of people are regularly hearing good things in the broadband sector, related to improvements in speed and plans to expand the infrastructure.

38

3432

34

45

53

4951

1714

1916

0

20

40

60




Health Insurance


Section 1

There has been a notable improvement in perceived news/media commentary in the health insurance sector as nearly 3-in-10 say they are hearing good things versus just 2-in-10 hearing bad things – a complete flip versus data from the previous wave in April 2014.

22

29

5153

27

18

0

20

40

60

April '14 (N=409) Jul '14 (N=412)


Level of Frustration with Current Providers Mobile Phone


Section 1

Just 1-in-6 mobile phone users are frustrated with their network provider while nearly 6-in-10 say they are not frustrated. Frustration levels are a key driver for switching intentions.

5956

59 59

25 2927 26

16 15 14 15

0

20

40

60

80


Not Frustrated Neither/nor Frustrated

Level of Frustration with Current Providers Electricity


Section 1

Over half of Electricity decision makers are not frustrated with their provider although similar to the mobile phone sector, this leaves approximately 1-in-6 who are frustrated by the level of service they receive.

5754 53 54

2732

30 31

1714

1815

0

20

40

60



Level of Frustration with Current Providers Bank


Section 1

The highest levels of frustration can be seen in the banking sector, although this has reduced slightly since October 2013 to 22%. While this is related to higher levels of switching perceived barriers, mean people switch banks less often than any other category.

48

36

45

50

2631 30

2826 27 26

22

0

20

40

60



Level of Frustration with Current Providers Car Insurance


Section 1

Frustration levels in the car insurance sector are lower than any other at 11%, although the number saying they are not frustrated has fallen by 5 percentage points since October 2013.

66

56

61 61

2633

29 28

810 10 11

0

20

40

60

80



Level of Frustration with Current Providers Broadband


Section 1

The number of those who are not frustrated with their broadband has peaked at 56% although the number of broadband users who are frustrated is relatively flat at just over 1-in-5.

52 53

48

56

24 26 262424

21

27

22

0

20

40

60



Level of Frustration with Current Providers Health Insurance


Section 1

The number of people frustrated with their Health Insurance feel considerably since April 2014 from 33% down to 22%, this was matched by an equal improvement in those who were not frustrated.

37

49

33 29

30

22

0

20

40

60

April '14 (N=409) Jul '14 (N=412)


Options – do people have a good or poor choice of provider?

Mobile Phone


Section 1

Nearly three quarters of mobile phone decision makers feel they have a good variety of network providers to choose from, versus just 8% who feel more competition is required.

74 7573 73

18 19 20 19

8 7 7 8

0

20

40

60

80


Good Choice Neither/nor Poor Choice


Electricity


Section 1

The majority of Electricity decision makers also feel that there is a sufficient number of providers to choose from with over 6-in-10 saying they have a good range of options.

59 60 5962

27 29 28 28

1412 12

10

0

20

40

60

80




Bank


Section 1

14% of banking decision makers feel they little or no choice when it comes to banking providers, although this is down from October 2013 – perhaps due to increased marketing and awareness.

54 53 5458

28 3128 28

1816

1814

0

20

40

60

80




Car Insurance


Section 1

Car insurance is perceived to be the sector with the best variety and level of choice. Three quarters say there is a good range while just 6% feel they have little or no providers to choose from.

77 7570

75

18 2124

19

4 4 5 60

20

40

60

80

100




Broadband


Section 1

The broadband sector is seen as the least competitive with nearly a quarter saying they have little or no choice when it comes to picking a provider. Slightly more than half feel they have a good range of options.

5759

5356

2423

252120

1821

23

0

20

40

60

80




Health Insurance


Section 1

While approximately 1-in-6 Health Insurance decision makers feel they have little or no choice when it comes to providers, the numbers saying they have a good variety to choose from has increased to 55% since April 2014.

Switching Patterns – Past 12 Months and Ever


Section 2

21 21

24

21

26 2827

26

109

119

3436

33

36

2627

2423

1716

0

20

40

Oct '13 Jan '14 April '14 Jul '14

Mobile phone Electricity Bank Car Insurance Broadband Health Insurance

Switching trends have been consistent across the duration of the study with Car Insurance leading the way by a noticeable margin. People are least likely to switch banks even though it is a sector that frustrates many decision makers.

Likelihood to Switch Provider in the Next 12 Months Mobile Phone


Section 2

25

1923

2124

2825

27

51 52 52 52

0

20

40

60

80


Likely Neither/nor Unlikely

Intention to switch in the next 12 months is well behind the numbers for those who switched in the past 12 months. This either means switching rates for mobile network providers will fall over the

next year or that switching phone providers do not take significant lead time or planning.

Likelihood to Switch Provider in the Next 12 Months Electricity


Section 2

27

23

35

2527

33

27

32

4644

3943

0

20

40

60

80



Having spiked in April 2014, the number of people planning to switch Electricity provider in the next 12 months has fallen back to standard levels (around a quarter).

Likelihood to Switch Provider in the Next 12 Months Bank


Section 2

1616 16

12

2431

27 28

60

54 55

60

0

20

40

60

80



Likelihood to switch banks is at its lowest point, well behind all other sectors at just 12%. While bank frustration is high, it is clear that barriers to switching are putting people off the idea.

Likelihood to Switch Provider in the Next 12 Months Car Insurance


Section 2

3132

4038

2833

29 29

41

36

3133

0

20

40

60

80



The number of people planning to switch car insurance provider in the next 12 months, actually exceeds those who do not think they will switch. Car Insurance is clearly a sector where high levels

of competition and a straight-forward switching process have resulted in high switching levels.

Likelihood to Switch Provider in the Next 12 Months Broadband


Section 2

29

25

29

2727

2929 28

4447

4245

0

20

40

60

80



Even though the range of options available to broadband decision makers is seen as relatively poor, just over a quarter are still planning on switching within the next 12 months.

Likelihood to Switch Provider in the Next 12 Months Health Insurance


Section 2

27

22

33 34

4044

0

20

40

60

80

April '14 (N=832) Jul '14 (N=815)


Similar to banking, health insurance is an area where frustration levels are relatively high, yet switching intentions remain low – although still not as low as banks.

Awareness of Bank Charges

(Base: All with a main current account – 982)

Section 2

Three quarters of banking decision makers say they know how much they are being charged in fees – the majority of these feel it is less than €50 per year.

July 2014

April 2014

January 2014

October 2013

Knowledge of Changes

%

Estimated cost per annum

%

Don’t know

%

6

3

5

4

Perceptions About Changes in Prices Mobile Phone


Section 2

34

2831

29

56

6361

59

10 9 812

0

20

40

60

80


Going up Neither/nor Going down

Nearly 3-in-10 Mobile phone decision makers feel prices are increasing – this is down since October 2013 and is the lowest scores across sectors.

Perceptions About Changes in Prices Electricity


Section 2

7673 73

62

21

24 23

32

3 35 6

0

20

40

60

80



While price increases were very much top of mind for people between October 2013 and April 2014, this figure decreased in the most recent wave of research – although it is still higher than other sectors.

Perceptions About Changes in Prices Bank


Section 2

Half of banking decision makers feel bank charges continue to increase versus just 3% who think they are decreasing. Almost half feel are neither going up nor down.

5654

58

49

40

4339

48

4 4 3 30

20

40

60

80



Perceptions About Changes in Prices Car Insurance


Section 2

Half of car insurance decision makers feel prices are on the rise although 1-in-8 feel they are decreasing. Customers in this sector are most likely to react to price increases by switching provider.

4744

5550

35

40

33

38

1815

12 12

0

20

40

60

80



Perceptions About Changes in Prices Broadband


Section 2

While broadband is an area where customers tend to be quite frustrated, only a third feel prices are increasing (almost as low as mobile phone charges). 1-in-10 say broadband is getting cheaper.

32 32

4135

55

58

50

55

1310 9 10

0

20

40

60

80



Perceptions About Changes in Prices Health Insurance


Section 2

7-in-10 Health Insurance decision makers feel prices continue to rise.

The Permanent tsb Switching Index

The permanent tsb Switching Index Score between 0–100

Index scores range between 0-100 and reflect an individuals power and freedom to move between providers.

Section 3

The Permanent tsb Switching Index Section 3

57 57 57 57

50 51 51

53

4647 47

48

5958 58 58

5354

51

53

45

48

40

60

Oct '13 Jan '14 April '14 Jul '14

Mobile phone Electricity Bank

Car Insurance Broadband Health Insurance

The Permanent TSB Switching Index continues to show the poor switching attitudes in the banking sector – while people are feeling frustrated with the level of service they

receive, this doesn’t overcome the perceived barriers to switching.


Main Reason for Switching Bank – July 2014

(Base: All banking decision makers who have switched – 99*)

Section 4

*caution small base size

Attitudes to switching continue to be positive among bank decision makers who have switched. Over half feel great that they switched and feel they should have switched ages ago.

66

64

59

60

27

I feel great that I switched

I should have switched banks ages ago

I feel really in control of my money as a result of switching banks

I have gained as a result of switching banks

Switching banks did not make any difference

65

60

56

60

30

68

57

55

64

26

51

51

43

55

25

October ‘13

%

January ‘14

%

April ‘14

%

July ‘14

%

31

20

36

40

55

62

50

46

14

18

15

14

Attitudes to Switching Banks – II Section 4

3-in-10 say that switching banks was less hassle than expected with over half saying it was as expected. Only 1-in-7 say it was worse than expected.

July 2014 (n = 81)

April 2014 (n = 99)

January 2014 (n = 82)

October 2014 (n = 86)

A lot less

hassle than expected As expected

A lot more

hassle than expected

Main Reason for Switching Bank – July 2014

(Base: All banking decision makers who have switched – 81*)

Section 4

*caution small base size

People say they are switching banks in order to get a better deal because their previous bank was too expensive. Poor customer service is also a key driver for switching.

43

16

10

8

3

12

7

I switched to get a better deal because my other provider was too expensive

I switched due to poor customer service

I switched for convenience as my new provider is closer to where I live

Previous bank closed

I switched due to recommendations from friends and family

Don’t know/no particular reason

Other

%

Bank Switching Satisfaction Section 4

Nearly three quarters of Irish bank switchers are satisfied with the move with just 7% saying they were dissatisfied.

43 39 36 36

32 3938

33

19 17 2224

2 4 45

4 1-

2

Very satisfied

Fairly satisfied

Very dissatisfied Fairly dissatisfied

Neither/nor

Oct ’13

(n=86) %

Jan ’14

(n=82) %

Apr ’14

(n=99) %

Jul ’14

(n=81) %

Holidays & World CupHolidays & World CupSwitching Code

Gender

Male

Female

Age

16-24

25-34

35-44

45-54

55+

27

30

24

26

39

26

Demographics

Awareness of Ten Day Switch Over

(Base: All Irish adults – 1,000)

Section 5

28

26

19

27

26

29

31

Only a quarter of Irish adults were aware that a ten day switch over was in place

for bank switching. Those who have switched are more likely to know this.

Region

Dublin

Rest of Leinster

Munster

Connaught/Ulster

Bank

Switched

Didn’t switch

73%

27%

No Yes

% % %

Confidence in Banks Complying with Ten Day Switch


Section 5

Nearly 3-in-10 lack confidence that the banks are upholding the 10 day switching code

while a quarter are confident that they are. Those lacking confidence say it is too difficult a task to complete in 10 days or are negative towards banks in general.

4 22 46 15 13

“Too difficult a

task to do within ten days”.

“Banks have not

been compliant to date”.

“Banks not concerned

about customers”.

“Banks are slow in

general”.

Reasons for lacking confidence

“Banks are

incompetent”.

“Don’t trust

banks”.

26% 28%

Not at all

confident

Lacking

Confidence

Neither/

nor

Fairly

confident

Very

confident

Impact of 7/10 Switching Code on Likelihood to Switch Section 5

34% said they would be more likely to switch if the 10 day switching code

was enforced. Only 23% said they’d be more likely to switch if a 7 day switching code was introduced – perhaps as they feel this is not feasible.

8 4

26

19

5971

4 43 2

Much more likely to switch

More likely to switch

Much less likely to switch Less likely to switch

Neither/nor

Ten day

switching code (n=499)

%

Seven day

switching code (n=485)

% Much more likely to switch

More likely to switch

Much less likely to switch Less likely to switch

Neither/nor

Holidays & World CupChildren &

Relationships Holidays & World Cup

6

Cost of Children Going Back to School Section 5

The cost of sending children back to school continues to increase with

parents saying the cost of college child costs €6,000 on average between fees, accommodation, books/materials etc.

6

15

23

29

46

One or more returning to college

One or more returning to secondary school

One or more returning to primary school

None of the above

%

Average Cost

€6,000

€1,530

€680


Delaying Breaking up with Boyfriend/Girlfriend Section 5

45% of Irish adults have delayed breaking up with a boyfriend/girlfriend – this is

most common among females aged under 35 and 25-34 year olds in general suggesting it is a more recent phenomenon.

6


Gender

Male

Female

Gender by age

M u.35

M o.35

F u.35

F o.35

Demographics

40

49

46

36

53

45

Age

16-24

25-34

35-44

45-54

55+

Region

Dublin

Rest of Leinster

Munster

Connaught/Ulster

42

55

47

45

35

46

40

43

50

10

15

20

33

23

Delayed for a number of years

%

Delayed for a number of months

Delayed for a number of weeks

No always done it ASAP

No never broken up with boyfriend/girlfriend

% %

Reason for Delaying Breaking up with Boyfriend/Girlfriend Section 5

The main reason for delaying a break up is that people feel the situation may

change while others (30%) knew their partner would get upset. A fifth (21%) say they just want to avoid the hassle or arguing.

6


45

30

21

14

9

7

7

6

2

2

4

Wanted to see if things would change

Know the boyfriend or girlfriend would take it badly

Save the hassle or arguing

Didn’t want to be alone

Specific occasions make me wait (e.g. exams etc.)

Family or friends really liked them

Shared property or buildings

Better off financially to stay together

Children

Other

Refuse

%

An online survey was conducted amongst

1000 adults aged 15+.

Quotas were set on gender, age, social

class and region to achieve a sample

aligned with the national population.

Interviewing fieldwork was conducted

between July 21st – 28th 2014.

Appendix: Research Methodology

permanent tsb switching index september 2014

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