Australian banks pay close attention to the average number of products their customers hold with them, with varying notions as to how many products they need to cross-sell before they consider a customer "locked in".And the banks should be concerned as Roy Morgan Research has thrown another metric into the mix. The research firm says the real test of cross sell success or customer loyalty should be based on what proportion of their customers' products a bank holds.The Big Four banks, on average hold just under one third (32.0 per cent) of their customers' financial products, although this is an increase from 28.8 per cent in 2010, according to Roy Morgan. Products that were considered include accounts, cards, loans, insurance, superannuation and managed funds. The indications are that, since 2010, all of the major banking groups have made some gains in the proportion of their customers' products they hold, but there are wide variations between banks over the product areas where their respective gains have been made. "While the Big Four banks have made some small gains in product cross sell since 2010, overall they have not performed well," said Norman Morris, industry communications director at Roy Morgan Research. "It is clear from the analysis that there is plenty of scope for these banks to increase their business from their existing customers rather than chasing new ones," said Morris.In spite of the vigorous competition waged between the major banks, the biggest competitors in terms of products for each of the major banks are other financial institutions and major insurance companies. "Reasons for this include lack of incentive for customers to consolidate, competition from specialist providers such as for superannuation and insurance, lack of product awareness, some concern regarding the spread of risk and staff that may not feel confident in a selling role," Morris said.Industry superannuation funds are also a major competitor across all of the Big Four Banks with around four to five per cent of products, but a greater share in terms of value. In contrast, credit unions and building societies now only hold around two per cent of the Big Four bank customers' products.