UBS Scores Best in Affluent Customer Ratings of 9 Leading Financial Service Firms

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Affluent consumers see their primary financial services provider in terms of how well the firm fulfills one of four distinct roles. A new analysis by Premium Knowledge Group identifies the firms with the strongest performance and those that come closest to meeting customer expectations for each of these roles.

On the other hand, for some customers, average performance may be all that is required to satisfy their lower expectations. This of course raises interesting marketing and service positioning implications for firms serving this market.

Based on recent analysis of its 2004-2005 survey data, Premium Knowledge Group (PKG) has developed a new method of assessing satisfaction among affluent consumers with their primary financial service provider.

The new assessment method is based on the reality that the average affluent consumer (defined as those with annual household incomes of $150,000 or more) has relationships with three or more financial service firms. Each of these firms is selected to play a specific and often differing role in the consumer's financial life. This satisfaction assessment method takes into account not only a customer's ratings of his firm's performance, but also how closely that firm's performance measures up to the consumer's expectations of his firm for that role.

"This analysis shows us that sometimes even relatively strong performance is not enough to satisfy customers whose expectations are very high," said Dick Baker, President and CEO of Premium Knowledge Group. "On the other hand, for some customers, average performance may be all that is required to satisfy their lower expectations. This of course raises interesting marketing and service positioning implications for firms serving this market."

Based on an analysis of 24 attributes that describe financial service firms, Premium Knowledge Group has identified that affluent consumers see four roles financial service firms play for them:

1.    Full-Service Provider. This role requires the financial service firm to offer a wide range of services (legal, trust, banking) provided by a staff of highly competent individuals. It allows clients to select the level of involvement they want in managing their own financial affairs. Customers generally expect these firms to be large (as distinguished from independent financial advisors) and to have unquestioned integrity. UBS Financial Services receives the highest performance rating on this role and comes closest to meeting its customers' expectations. Merrill Lynch has the next strongest performance score for this role, but Morgan Stanley comes a little closer to meeting its customers' expectations.

2.    Personal Service Provider. This role requires the firm to provide personalized service, a personal relationship, an understanding of the customer's needs and a tailored solution for the customer. Once again, UBS customers award their firm the strongest performance ratings for this role and indicate that UBS comes closest to meeting their expectations. Following UBS with the highest average performance ratings for this role are Merrill Lynch and Smith Barney, while Washington Mutual and Charles Schwab follow UBS in delivering the level of performance that most closely meets customer expectations.

3.    Results-Oriented Provider. This role requires the firm to have a team of experts trying to outperform financial benchmarks in order to achieve results that meet the customer's objectives. The firm must offer comprehensive solutions, provide the research that the customer wants, and be efficient and well managed. The firm scoring the highest overall performance in this role and that comes closest to achieving the level of performance expected by customers is once again UBS. Merrill Lynch and Smith Barney follow UBS with the next strongest performance ratings, while Wells Fargo and Charles Schwab turn in slightly lower performance but come closer to meeting customer expectations.

4.    Low-Cost Provider: This role requires that the firm charge low fees but still be responsive to the customer. The firms with the highest performance ratings are UBS Financial Services, Smith Barney and Washington Mutual. UBS slightly exceeds customers' expectations for this role, while Merrill Lynch and Morgan Stanley are the next closest firms in meeting customer expectations for this role.

In effect, when affluent customers choose a firm to be their primary financial service provider they have expectations regarding the relative importance of these four roles, and evaluate a firm's performance in terms of how well their firm fulfills these four roles.

The analysis was based on 980 affluent households surveyed between March 2004 and January 2005. All respondent households earned over $75,000 per year, and over two thirds of PKG's households earned more than $150,000 per year. The nine firms profiled in the report are Bank of America, Charles Schwab, Fidelity, Merrill Lynch, Morgan Stanley, Smith Barney, UBS Financial Services, Washington Mutual, and Wells Fargo.

An overall report of Premium Knowledge Group's findings is available by contacting Premium Knowledge Group at 214.540.8018 or by visiting their website at

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