Six years after the financial crisis, financial services firms are still burdened by reputational and customer service issues, according to a survey released Tuesday by the communications firm Makovsky.
Eighty-one percent of communications, investor relations and marketing executives surveyed said the financial crisis continued to strongly affect stakeholder perceptions of their firms.
The study showed that this negative perception was taking an even bigger toll on sales, as the firms interviewed reported an average business loss of 27% — equaling billions of dollars — in the last two years as reputational and customer service issues persisted.
This average loss was significantly higher in the past 12 months than reported in the 2013 study, according to Makovsky.
“The financial crisis has left scars and those scars may be permanent,” Makovsky executive vice president Scott Tangney said in a statement.
Firms in the survey complained of constant reputation and customer satisfaction issues related to trust, regulation, products, liquidity and capital, financial performance and compensation, Tangney said.
“The standing of many has been diminished, with nearly half of executives telling us that the crisis fallout made their firm competitively vulnerable, allowing their closest or direct competitors to gain an advantage.”
For the study, Ebiquity, a research firm, in May interviewed 225 executives and managers responsible for the management and supervision of communications, investor relations or marketing at banks, brokerages, asset management firms, insurance companies, real estate companies, credit card companies, mortgage lenders, venture capital firms, credit unions and financial technology firms.
The study found that improving reputation had become a chief priority at financial services firms, especially as negative perception was having a greater effect on revenue loss.
Tangney said it would take up to five more years to restore firms’ reputations to pre-crisis levels.
Researchers asked executives at financial firms to rank the issues that had negatively affected their organizations over the last 12 months:
- 64% said negative perception of the financial services industry
- 55% said regulatory investigations, actions and fines or lawsuits
- 53% said capital and liquidity challenges
The importance of each of these issues had increased compared with last year’s results, Makovsky said.
In addition, 52% of the firms surveyed said financial performance and excessive bonuses had dragged on their reputation in the past 12 months. And 50% reported that customer dissatisfaction and corporate governance were negatively charged issues for their firm.
Respondents said their greatest reputational challenges in the next 12 months would be:
- Differentiating themselves from financial firms and competitors with reputation problems
- Improving the firm’s reputation to increase sales (a 300% increase over 2013 findings)
- Rebuilding trust in the overall financial system
- Increasing awareness with stakeholders (a 200% increase over 2013 findings).
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