We are taking a hiatus from our monthly survey of channel behaviour to unveil some findings from the latest Novantas Canadian Shopper Survey. This proprietary research, which sampled 1,555 consumers across 11 Canadian markets at the end of 2020, explored attitudes and behaviour of Canadians who have switched banks or have chosen a bank for the first time.
We all know that COVID-19 has drastically changed the way people move and interact with banks. As a result, the Big 5 banks experienced a decline in unaided awareness in 2020 that is likely tied to the fact that Canadians just weren’t out and about as usual. At the same time, direct banks increased their aided awareness. (See Figure 1.) Digital players, meanwhile, increased their share of purchase in 2020, helping to create a more competitive market.
Figure 1: Unaided awareness of Big 5 banks is decreasing as aided awareness of digital players is on the rise
TRENDED UNAIDED AWARENESS













Aided awareness of digital players















Source: 2020 2019 CA Shopper Survey. Percentage Point Shift from 2019 to 2020
TRENDED UNAIDED AWARENESS















Aided awareness of digital players















Source: 2020 2019 CA Shopper Survey. Percentage Point Shift from 2019 to 2020
The Big 5 banks must continue shifting their reliance on branch networks as a key driver of unaided awareness. Targeted marketing spend and sponsorships will be increasingly important as the pandemic continues to affect consumer movement patterns. Direct banks present a unique challenge to the biggest players as their propositions continue to attract consumers away from the Big 5 banks, increasing their share of purchase in 2020 – largely at the expense of the Big 5. (See Figure 2.)
Figure 2. Direct players increased their share of purchase
Source: 2020 2019 2018 2017 CA Shopper Survey
Base: Recent Purchasers opened in 2017 (n=420), 2018 (n=489), 2019 (n=375), 2020 (n=271)
The research also shows that branches are no longer the leading drivers of acquisition, declining in importance as selection drivers and losing productivity as the country shifts towards omni-channel or digital-only solutions.
As branches become less important to shopping customers, brand and digital capabilities are at the core of driving differentiation for consumers. New digital disruptors are entering the Canadian consumer banking landscape; the U.S. may serve as a guide to their performance. As we see consumers become more open to digital options, awareness of the digital providers is increasing. Direct players such as Tangerine and PC Financial increased their share of purchase in 2020 and the market is increasingly competitive, with non-traditional players standing out.
Tangerine & PC Financial
are driving up the 2020 direct bank openings
Distinctiveness remains a key driver of bank consideration and is largely driven by marketing and break-out propositions and products. In 2020, none of the top attribute scores are owned by Big 5 banks. Instead they were dominated by regional banks like Desjardins and ATB and digital banks like EQ Bank, Revolut and WealthSimple. (See Figure 3.)
Perceived convenience is closely tied to acquisition and continues to shift towards omnichannel capabilities and away from branch-centric factors. The majority of the Big 5 banks saw a significant decline in perceived convenience, tied to their reliance on their physical network as a leading channel at a time when consumer movement was restricted.
The traditional distribution model is experiencing disruption, lowering the barrier for new entrants to the space. Without branches, marketing and product levers are now critical to driving consumers’ bank choice. Customers increasingly value online and mobile capabilities, and care less about physical access. New entrants are creating products based on consumer needs that are unmet elsewhere and often are creating a better digital experience.
With the rapid shift to digital, there are three key considerations for 2021. Firstly, banks with large branch networks need to transform the role of the network, including format and staffing, as well as moving branches to more visible locations. Secondly, they need to optimize acquisition levers by shifting the mix of branches and marketing to maintain cross-LOB acquisition. At the same time, they must harvest costs from the network to drive higher value re-investment elsewhere. Lastly, they will need to continue to invest in advanced digital capabilities to simplify customer wallets, financial management and to make it easier to activate an account.
We will continue to track these and other trends in each update of this monthly report. Please email Nick Young at nyoung@novantas.com if you would like to be subscribed.