Change can be hard – but switching your current account doesn’t have to be
The last couple of years have been marked by changes. In the way we work, socialise and shop. Unsurprisingly perhaps, and as a way to cope with these changes, the majority of the population has remained loyal to their preferred brands.
To understand whether people’s behaviour is changing, here at the Current Account Switch Service we recently commissioned research which revealed more than half (55%) of consumers are as loyal to their favourite brand as when the pandemic began. Similarly, an additional 52% would only consider switching their favourite brands if they ceased trading.
This switching inertia is particularly prevalent in the current account market and is especially true of those who approved of their provider’s performance during the pandemic. I think it is reassuring to see that banks and buildings societies were top of the list of services consumers expressed an unwavering sense of loyalty to.
When asked how they feel towards their existing current account provider, 33% claim to be very loyal and that it would take a lot to see any benefit in switching. Another 12% claim they would never switch to another provider.
I recently did a series of interviews with consumer psychologist and brand expert Kate Nightingale, and she explained this is because many people associate comfort and familiarity with their current provider instead of seeking alternatives that best suits their needs. In addition, those reluctant to switch are concerned that switching could be a difficult or lengthy process.
However, we can see the tide may now be turning as the cost of living begins to rise.
The current economic climate, coupled with changing consumer attitudes on ethical and environmental practices, are making many re-evaluate their brand loyalty. Indeed, the current cost-of-living crisis is forcing nearly one in five people (18%) to seek out additional overdraft facilities, with one in nine (11%) realising they need banking services that can help them better track their spending.
While breaking brand loyalty to certain products and services can be difficult, switching to better options is simple and stress-free. Take switching current accounts, for example. Through the Current Account Switch Service, anyone in the UK can switch from one provider to another, with a guarantee the process will be completed in seven working days. The process is free, quick and easy, allowing people to benefit from improved banking services, in-branch facilities and cashback incentives with minimal stress and effort.
Like most people, I think I am inherently loyal and tend to reject unnecessary change, particularly in times of uncertainty. Nevertheless, unwavering loyalty should not stand in the way of your financial wellbeing. With price pressures mounting, it is now increasingly important that people challenge their own perceptions and think critically about choosing services that better align with their needs.
Kate gave me these pieces of advice on how to embrace change:
- Benefits Ripple Effect – When reviewing the benefits of different providers or products, take each benefit and list three ways in which it can improve your life. For example, three ways to use your cash joining bonus to improve your wellbeing. Then place a value on each benefit based on how much good you feel it can bring to your life.
- List your values - When looking to switch, first list your own values and what's important to you. Then, take time to list the values you believe each of the brands you are considering has. Compare the two lists and start from the brand that you share most values with. Do they offer you all the benefits you need, want and desire?
- Changing environment - Changing your perspective can help you perceive the value of alternative brands or services. So, how about you research a new current account in a park instead of an office? You’ll associate the new account with the lifestyle aspects that are important to you, for example relaxation, friends, wellbeing. This will then allow you to think more logically about the value of certain benefits. Review your brands shortlist in two to three of your favourite environments few days apart and see how your evaluation changes. Then combine these evaluations together and choose the best option for you.
- Cosy it Up – When we put our body in a state of physical comfort (for example, snuggling up on a sofa with a blanket and our favourite cup of tea) it can make the process of tackling more difficult, or simply less familiar, tasks feel altogether easier. This simple change in behaviour can be a great way to overcome our natural biases with physical relief and pleasure.
- Try Something New - Always wanted to do a hula hoop exercise class, try that exciting new cuisine or explore a new language? Go ahead. Once your mind is in ‘new experience mode’, it is easier for it to consider alternative brands/products/services. Your brain will simply be more open and less prone to default loyalties.
If you would like to find out more about the research, please contact: email@example.com