According to GlobalData’s 2023 Financial Services Consumer Survey, 91% of Nationwide’s customers were happy with its previous brand. This proportion was significantly above the market average (87%), placing Nationwide among the top four. This rebrand could lead to currently satisfied customers becoming unhappy with the bank’s brand and seeking a move away to a different provider.
However, Pay.UK’s Current Account Switch Service statistics suggest Nationwide was losing customers anyway. In Q1 2023, the building society recorded the largest net loss of any UK provider for current account customers, shedding over 34,000 customers. GlobalData research suggests the struggles Nationwide has had in attracting new, younger customers and the old branding could have been the issue holding it back.
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According to GlobalData’s survey, branding and reputation ranks high as a driver for bank choice among all UK consumers, even the 18–24 age group, behind only digital capabilities. With neobanks appealing to young customers with new, fresh branding, Nationwide has created a new logo more in line with modern design trends in the hope of attracting this demographic.
Nationwide branch guarantee
This move should couple well with Nationwide’s commitment to branches. Having overtaken Lloyds as the provider with the most branches in the UK, Nationwide renewed its guarantee to maintain a branch banking service in every town and city it is currently present in until 2026 (previously 2024).
Visiting a branch is the second most popular research method used by 18–24-year-olds to find out about financial products and services. The most popular is consulting friends and family members, and Nationwide can hope that some of those can already be banking with the building society. Nationwide has the highest customer satisfaction in terms of ease of access to branches and call centers according to GlobalData’s survey. Doubling down on the branch promise is a nod not just to prospective customers, but also to existing ones who may feel uneasy about the logo change.
With Q1 2023 switching statistics not going in Nationwide’s favour, the strategy of a complete rebrand may appear to pose a further risk to customer retention. Yet a closer look at customer satisfaction and consumer preference metrics suggests the expansion of Nationwide’s branch promise should help it retain its current customer base, while the new image may attract some much-needed new customers.
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By GlobalDataHarry Swain, is an associate analyst, GlobalData
