The main supermarkets each receive a big share of our weekly spend, so what makes regular grocery shoppers reluctant to become customers of supermarket banks too?
To understand this landscape, the financial services team at Harris Interactive conducted a short survey using Harris 24. After launching at 6pm on Wednesday June 7th, by bedtime we had collected 1018 nationally representative responses from the UK public.
Overall, almost three in five (57%) would not consider any supermarket for a current account. Across the financial products we asked about, consumers are the least likely to consider supermarkets for mortgages (70% would not consider any supermarket) whereas travel money is the most likely to be considered (38% would not consider any supermarket).
The most commonly mentioned reason for shoppers not considering their main supermarket is because they ‘prefer to have financial products with financial companies’, selected by a third overall. For a significant proportion trust was also an issue with 14% selecting they ‘do not trust the supermarket to provide financial products’ and this did not differ significantly for regular shoppers of each of the main supermarkets.
Which supermarket’s shoppers are the most likely to consider them for financial products?
Looking at current accounts: People whose main supermarket is Tesco are the most likely to consider them (37% would consider Tesco for a current account) and Sainsbury’s is close behind (33% whose main supermarket is Sainsbury’s would consider them for a current account).
Shoppers are most likely to consider their main supermarket for general insurance products: specifically travel, home and car insurance; whereas they are more reluctant with life insurance. For instance, 40-41% of people whose main supermarket is Sainsbury’s would consider them for travel, home and car insurance, but only 23% would for life insurance.
Finally we asked which supermarket bank shoppers would consider for different financial products. Whilst the largest group would not consider any supermarket bank, of those who would there was a clear trend for loyalty: regular shoppers were most likely to consider their main supermarket. To take Sainsbury’s as an example, almost two in five (38%) of their regular shoppers would consider them for a credit card whereas just over one in five (23%) would consider Tesco.
To expand their business, all supermarket banks have the same problem: that many consumers will not even consider a supermarket brand for financial products because they don’t see it as a supermarket’s place. The key will be to get consumers to consider supermarket banks as financial companies. Consumers are already most willing to consider supermarket brands for certain insurance products and travel money, so these products could perhaps act as a gateway to consideration of a broader portfolio.
If you would like more detail on these results, including how they look between holders of different loyalty cards, get in touch with Vicky Whiting (firstname.lastname@example.org).