2024 CX Benchmark Report Reveals Key Strategies for Superannuation Member Retention

By Smart Communications 

The superannuation industry in Australia has undergone significant transformation over the past few years, marked by a series of mergers and acquisitions that have consolidated the market. These changes have shifted the landscape of member retention and attraction dramatically. With the Australian government's policy allowing members to easily switch between superannuation funds, competition has intensified further. In this challenging environment, maintaining member loyalty and attracting new members is more critical than ever. 

However, the Australia Superannuation Customer Experience Index Rankings for 2023, conducted by Forrester, reveal a concerning trend. The average customer experience (CX) quality of Australian superannuation funds has declined, from 62.5 on a 100-point scale in 2022 to 61.0 in 2023. Despite this drop in CX quality, customer retention rates remained stagnant at 64% across both years.  

Our 2024 Benchmark research delves deeper into how superannuation funds can effectively navigate this competitive landscape. It highlights the crucial role of clear, accurate, and timely communications, alongside robust data collection processes, in aligning with today’s consumer expectations. The findings underscore that, amidst declining CX quality, enhancing member communication is essential for building and sustaining trust and satisfaction. 

Approximately two years ago, the Australian government implemented significant regulatory changes aimed at enhancing the accountability and performance of superannuation funds. One key aspect of this reform is the introduction of the Australian Taxation Office's (ATO) super fund comparison tool and the annual performance test by the Australian Prudential Regulation Authority (APRA).  

These measures make it easier for members to compare funds based on fees and performance, thereby facilitating informed decisions about switching super funds. As a result, members dissatisfied with their current fund's performance or service can seamlessly transfer their savings to a better-performing fund. This regulatory shift underscores the importance for superannuation funds to prioritize member satisfaction and engagement to prevent churn and maintain competitiveness in a dynamic market. 

According to our 2024 Benchmark research, 85% of Australians consider customer communications to be somewhat or very important to their overall customer experience. In an era where switching funds is easy, this statistic highlights the crucial role of effective communication in retaining members. Notably, 59% of Australians indicated they are likely to switch away from a company if their communications do not meet expectations, up from 52% in 2023. This increase signifies a growing intolerance for subpar communication practices. 

The report reveals several critical factors that superannuation funds must consider enhancing their communication strategies: 

1. Clarity and Ease of Understanding: 68% of Australians prioritize clear and easy-to-understand communications. Superannuation funds must ensure that their messages are straightforward and accessible to all members. 

2. Accuracy: 54% of respondents value accuracy in communications. Providing precise and reliable information builds trust and confidence among members. 

3. Timeliness: 35% of Australians emphasize the importance of timely communications. Regular updates and prompt responses are essential in maintaining member engagement. 

4. Preferred Channels: 34% of members prefer communications delivered on their chosen channels.  

5. Trust Factors: Data security (68%), accuracy of communications (64%), and ease of contacting the company (55%) are the most important trust factors for Australians. Ensuring these elements are consistently addressed can significantly enhance member loyalty.