New CSBA report shows low retirement confidence, decline in satisfaction
Timely and meaningful customer interactions are critical in providing reassurance and personalised engagement in our current economic climate, says CSBA CX Director of Finance, Sam Monteath.
“Members need to know that their super funds are there for them. They want reassurance that they are with the right fund. The focus must be on adding value if funds want to keep building trust and loyalty.”
The latest results of the CSBA FEAL Superannuation CX Benchmarking report show that the customer experience of Super fund members declined in all key measures, and retirement empowerment weakened.
The report, comprising surveys of 5,426 individual fund members from 20 Superannuation funds conducted in July and August 2022, also found that only 59% of those aged 55 and over had a high degree of confidence they would have enough money for a comfortable retirement.
Net Promoter Score (NPS) for All Funds included in the study dropped 11 points from +26 to +15, compared with the same period in 2021.
Overall Satisfaction fell from 8.1 to 7.7, Ease of Dealing fell from 8.3 to 8.0, and the Likelihood to Switch Funds rose from 17% to 23%.
One in three members disagreed that their fund empowered them to plan and prepare for retirement, compared to one in four in 2021.
And the confidence of having enough money for a comfortable retirement was low, scoring 6.6 out of 10. This dropped to 6.3 for females (6.9 for males) and 5.7 for members without recent fund contact (6.6 for members with recent fund contact).
Intention to switch is on the rise
When asked about their past switching considerations and intentions to remain with the fund in the year ahead, 25% of members with recent fund contact said they had considered switching funds in the last 12 months. And of those who considered a switch, 63% said they would likely complete the switch in the next 12 months. Compared to the same period last year, 18% of members considered a switch, and 49% of those intended to switch in the year ahead.
The 35-44 age group is at the highest risk of switching, with 30% indicating they were likely to switch in the next 12 months, compared to 22% in the same period last year. The 25-34 age group is also a high-risk group, with 26% indicating they were likely to switch in the next 12 months (unchanged from last year).
Trust featured heavily as both a key reason to stay with a fund long-term (24%) and as one of the most apt descriptors of one’s fund (29%) – “I trust them to act in my best interests.”
Retirement empowerment has weakened
In the area of retirement empowerment, 33% disagreed that “The fund empowers me to plan and prepare for my retirement” compared to 27% in the same period in 2021.
Across the demographic groups, under 55s, females, shorter term members and those in a default investment mix were more likely to disagree their fund empowered them.
Make meaningful interactions
With current market volatility negatively impacting member sentiment, Monteath says Super funds must make proactive communication a priority.
“Acknowledging members’ specific concerns in the current climate; transparent communication around investments and fees; and age-appropriate communication using their channels of choice, are key to building trust and loyalty,” she said.
“Especially since ‘Trust’, ‘Excellent Financial Returns’ and ‘Making Members Feel Valued’ continue to be the top three key drivers of Overall Satisfaction and NPS.”
About CSBA FEAL Superannuation CX Benchmarking
The program began in 2009 as an initiative between CSBA, FEAL and Melbourne Business School, to provide fund executives with comparative scores for key customer experience measures using a robust and consistent methodology on a regular basis. The latest six-monthly study conducted in July and August 2022 included surveys of 5,426 individual fund members from 20 Superannuation funds and almost 1000 employers which found similar changes in customer sentiment.