Share of wallet in Australian retail banking : implications for practice and research

Previous research has investigated the determinants and consequences of customer loyalty, but in banking, a critical but often neglected measure is the customer’s ‘share of wallet’ (SOW). Since some customers are more active in either investments or loans, the study, based on a survey of 1,924 retail banking customers, models SOW separately in terms of deposits and debts/loans. The results suggest that approximately 25% of the variance in share of wallet can be predicted, in particular by demographic factors such as age, income and a customer’s location. The typical client with growth potential for deposits is found to be male, aged 35-65, has a high income and a university degree, and lives in a city area. In contrast, factors such as satisfaction, attitude and service quality were not significant predictors of SOW. Implications for bankers and researchers are discussed.6 page(s