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|How to Transform Customer Experience in Banking

How to Transform Customer Experience in Banking

Traditional financial services providers are embracing digital business transformation as a means of fending off hi-tech competition from FinTechs. But unless that transformation provides a platform for greater customer experience (CX), it will come up short.

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customer experience in banking
by Monti Becker Kelly May 13, 2020 - 7 MIN READ

Over the past three years, the world’s 160 biggest traditional retail and commercial banks have invested a combined $1 trillion in digital business transformation efforts.

The size of that sum should not come as a surprise. The levels of disruption that digital-by-default FinTechs could bring to the financial services market are greater than those already experienced in media, retail or travel and tourism.

In 2012, Capgemini polled all major financial services organizations and 41% said they had the digital capabilities needed to succeed. Fifty-one percent said they have the leadership capabilities required for transforming successfully. When the respondents were polled again five years later, those figures had dropped to 37% and 41%, respectively.

A major reason for this decline in confidence is that many digital transformation initiatives – already undertaken or currently in progress – focus on internal improvements and efficiencies, rather than putting the customer at the heart of the business.

Focusing on the customer to deliver what they expect, how they expect it and when, across any number of channels, is what separates winners from losers.

Customer experience in banking is a key differentiator

Banking has become a commodity. Nine in 10 U.S. adults are already banked, and while established players have become experts at customer acquisition, the gains are very much short term. And that’s because every major bank offers roughly the same portfolio of products and services at similar price points. Therefore competing on costs is unstainable.

Instead, financial services providers need to compete in terms of service level – the experiences they deliver. Investing in the customer experience in banking is the only way to attract and retain customers and crucially, increase their potential lifetime value.

And at least for the moment, FinTechs appear to be winning the battle for customer trust. According to EY data, adoption rates for FinTech products and services have already hit 46% of the U.S. adult population – and that figure can only grow as customer loyalty is converted into advocacy and recommendation.

So, as more and more traditional financial services providers begin their transformational journey, how can they ensure their efforts lead to greater customer engagement?

Train for technology

Banks are fully aware that much of their operations and related data is trapped in silos. This is most often the main motivation for undertaking a digital transformation. However, what is often overlooked is that once the technological element of the transformation is underway, it needs to be augmented with human transformation.

People should be informed about why the changes are happening and trained in order to make the most of the new systems. This leads to greater productivity. Otherwise, the transformation will simply highlight and magnify flaws in existing operational practices. Organizational change management is a crucial element of business transformation, but it can get pushed down the list of priorities or can fail to align with the overall goals of the project.

Understand your data

Even if contained in silos, banks hold an enviable amount of customer data that can be used to deliver incredible levels of insights to drive digital transformation. Simply applying analytics to conversations passing though the call center will unearth a treasure trove of information ranging from customer sentiment towards the brand and feelings about certain products and offerings, to the elements of the customer experience that are working well and those that are creating frustration.

This initial analysis will also point to areas of contact center agent training where improvements might be necessary, or where existing systems are creating problems for agents attempting to resolve issues quickly,  without escalations.

Understand the customer journey

Armed with the results of the initial data deep dive, you can start understanding your customer journey – how customers discover, consider, choose and subsequently stay with you as their financial services provider – and the interactions during that journey that are already meeting customer expectations.

Customer journey maps are crucial because they help you understand your business from your customer’s perspective. To be effective, a customer journey map should map out the entire customer experience in banking – from physical and digital advertising, to the in branch experience and engaging with your website, phone banking service, mobile app and contact center.

Also, it’s crucial they also include insights gleaned directly from the customer base. Voice of the Customer (VoC) surveys and focus groups will prove invaluable in making sure you stay focused on what needs to change from a customer’s perspective, rather than shifting focus to changes that will simply make business processes more efficient.  

If you’re moving from siloed to unified processes, conducting this exercise will highlight how this inability to share information across the business and channels have been negatively impacting the quality of customer experience, but it will also give you a clear, actionable plan regarding how to address these shortcomings.

Provide an omnichannel experience

The term omnichannel is often misinterpreted as meaning a brand needs to be available on every single conceivable channel type. All major banks already offer online, telephone, in-person and mobile banking. That’s every major channel covered. Indeed, industry data already shows that all major U.S. banks are nailing the individual channel experience. According to the latest J.D. Power research, the average satisfaction rating for U.S. banks’ mobile apps is 853 points (out of 1,000). Likewise, for most banks, individual channel NPS scores are also excellent.

However, because these channels are stacked on top of each other, information captured in one interaction in one channel cannot be recorded and shared across all other channels. Therefore, if a customer begins the path to purchase in one channel, they can’t move to another channel and pick up where they left off. They have to start again. For example, a 2018 report from Aite Group found 36% of U.S. consumers will switch channels while opening a checking account.

Capturing this information and ensuring it moves with the customer between touchpoints and engagements is only possible if the channels are supported by an omnichannel engagement platform. Not only does this capture all information in real time, it presents it in a unified, simple to understand format for your CX staff so that issue resolution is optimized and confusion and duplication is eliminated.

What’s more, with this type of engagement platform, it’s simple for a business to integrate more channels, such as SMS or social media messaging.

Make a serious investment in self-service

Being able to analyze the data flowing into the organization via an omnichannel platform quickly delivers new levels of intelligence and even greater customer insights. Use these findings to identify, reassess and address common contact drivers. Regardless of their preferred channel or demographic, all customers value rapid issue resolution as the most important single aspect of a good customer experience. 

If you can help customers resolve their own issues, via detailed FAQs, an online customer-facing knowledge base, chatbots or use of IVR, you will empower your customers while providing them with 24/7 service. Gartner research shows 90% of consumers who have an issue will attempt to deal with it themselves via self-service tools, however, just 9% of customers surveyed said that they had successfully resolved their issue simply through a company’s self-service facilities.

Don’t view contact centers as a cost center

Digital transformation should optimize – not replace – contact centers. The relationship a customer has with a bank is personal and no matter how good a mobile app or how comprehensive the self-service portals, there are going to be moments of truth where only a conversation with a person can resolve the issue.

A recent Kony study of U.S. consumers and businesses found that within financial services, 57% of customers want products and services to be available digitally, but underpinned and supported by real people. In fact, respondents said they were more likely to consider a digital service if they could first engage with a named company representative. When given the choice between 100% digital banking and a human-digital blend, 32% of respondents said they were more likely to bank with this approach and 26% said it would be their preferred method of interacting with a bank.

Profit from personalization

With a single customer view, whether the individual is interacting with a teller or a chatbot, your organization will have greater levels of data that, thanks to the transformational journey, all resides together and can be analyzed for new levels of customer insight.

Initially this new understanding helps optimize the service you’re delivering across your channel mix, but will soon also enable the organization to start segmenting customers, spotting behavioral trends and identifying new products or services that align with customer expectations. For example, within the contact center environment, these insights make it easy for agents to identify customers (based on responses and demands) who are in danger of churning and more importantly, take the appropriate actions to keep them with the institution. Likewise, these analytics will flag your best customers and ensure you do what’s necessary to keep them loyal and even more engaged.

This new understanding will guide marketing efforts – ensuring the right offers target the right customers in the right channel at the right time – and continues with how your organization interacts with each customer, based on their preferences and transactional history.

But personalization goes beyond recommendations, upselling, cross-selling and reducing churn; it is the key to recreating the types of connections and lasting relationships banks were known for when all interactions were in-person and face to face. Therefore, banks need to use the data at their disposal to create what feels like personal customer experiences. This is only possible by leveraging the best automation technologies and the talents of their customer-facing employees – be it in a branch or at a contact center.

Measure for success and constantly improve

As already mentioned, most banks have high CSAT and NPS scores for individual channels. But with an omnichannel approach, you need to have the right metrics in place to measure the entirety of the customer experience. There are some obvious operations that can be tracked and measured, such as performance of product and service lines and of course customer churn, but it’s important to supplement this data with KPIs and other metrics that provide the big-picture view.

When NPS, CSAT, Customer Effort and VoC are all used together across all channels and correctly processed, they can start to offer this level of understanding. However, the best way to understand how you’re performing in terms of customer expectations, in real-time, is through speech and text analytics. This way, you’ll be able to analyze customer sentiment, indicate any potential shortfalls in agent training or gaps in self-service, as well as common call drivers and whether or not a customer is genuinely satisfied with an interaction.  

And it doesn’t stop there. With the right data and analytics partner, this data can be combined with data from other unstructured sources, such as social media, to get an even clearer view of conversations happening around your organization and the industry in general. All of which can be fed back into the business to aid and accelerate customer-focused decision making.

In conclusion, having the right tools, technologies and infrastructure are essential to delivering an exceptional customer experience in banking. To learn more about how to build customer trust in a digital world, download our eBook, Three Essential Elements for the Future of FinTech & Banking

written by Monti Becker Kelly Global VP and Portfolio Leader (Account Management, FinTech and Banking)
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