As consumers shift toward conducting more business through digital channels, financial institutions’ ability to really listen to their customers and detect their needs can be negatively impacted. This is because, when customers interact digitally, banks miss many of the timing signals they would normally detect with human interaction. This requires a new business model – one that leverages digitally-savvy technology to support a customer‑centric strategy supported by the gathering of intelligent customer feedback.
Having a true customer engagement (CE) model as a centerpiece of a customer delivery strategy is crucial in today’s marketplace. Digital customer engagement is now the financial institution’s interaction venue, and one that translates into end‑user experience. Whether it is empathy, content quality, relevance, or timeliness, all are now subjectively judged based on a perception of how well the institution knows their customer’s or prospect’s identity, needs, issues, financial understanding, and product interests.
After surveying hundreds of bankers on their customer delivery strategy, some proven strategies emerge that demonstrate how banks and credit unions can increase customer and member loyalty while continuing to operate profitably. These include:
- Provide the ability to open accounts without having to enter so much information;
- Personalize your service and recommendations based on their life stage;
- Give them the ability to start a request in one channel and finish in another;
- Provide an instant decision on their request for a loan (customers will pay a premium for quicker decisions); and
- Provide a financial planning tool that helps customers set goals and meet them.
Since consumers are more empowered in today’s digital environment, it is important to capitalize on opportunities for personal interaction and understand consumer needs and intentions.
Traditionally, customer interactions primarily involved in-person discussions, written correspondence, and telephone-based conversations. In a digital environment, while customers still value face-to-face service, more direct access to information brings new opportunities both for the consumer and for the financial institution. While those traditional interactions were typically reactive to customer‑initiated visits or calls, in an expanded digital world, software‑based engagement methods take advantage of a more proactive approach with the ability to capture additional opportunities across various customer journey stages.
Nurturing and intelligently directing a customer improves their experience through relevant messaging, driving value for consumers and institutions alike. Engagement helps users quickly find a solution that fits their needs and sends a strong message about an institution’s commitment to personalized service.
This type of customer-centric delivery strategy also helps combat customer attrition, which is much more difficult to manage in a digital world where face-to-face engagements are reduced. Predictive analytics listen, detect, and measure events, both positive and negative, to quantify the probability of customer attrition. Alerts can be sent to appropriate personnel with insight into products, servicing, and pricing so that the causes of attrition risk can be corrected and reduced over time.
Implementing a comprehensive digital strategy is an essential component for banks and credit unions to successfully meet consumer needs and expectations, effectively manage the customer journey and ensure relationships are managed for continued success and profitability.