Customer-centric thinking, digital technologies reshaping financial services
By Karl Reed, Chief Solutions Officer at Pivotal Data.
The global pandemic injected pace and intensity into the financial services industry's race towards digital transformation. These new digital technologies have changed the way financial services providers interact with staff, customers, processes and partners.
However, the unprecedented speed and scale of these digitalisation initiatives has created gaps between digital services and customer expectations.
Even before the pandemic, consumers were transitioning away from cash to electronic, card and mobile app transactions. The pandemic hastened this transition and consumers now expect 24/7 availability across multiple channels and devices, without the loss of the banking security and resilience they traditionally experienced.
Customers now expect their financial services provider to be digitally advanced and technologically sound. The integral role that seamless financial services play in the digitally connected consumer's modern lifestyle means banks, lenders and insurers must look beyond the technological enablers and channels to focus on the customer experience by placing people at the heart of the customer journey.
According to the Finextra “Personalisation-as-a-Service: Harnessing Data in the Banking and Payments Industry” research report, 84% of customers want to be treated like a person, not a number by financial institutions, while over 70% say they expect to be rewarded for loyalty to the brand.
Furthermore, customers expect a seamless and consistent experience across financial products, such as retail banking, credit cards, loans and insurance. Financial services providers also need to positively engage with their customers from end to end, while also giving customers a feeling of control and choice.
And customers will measure their digital experience and service levels against digital native businesses like Amazon and Google, not just other banks.
Meeting these expectations begins with a customer experience vision, which will drive customer perceptions and satisfaction levels throughout the customer journey. Data is the key to realising these digital ambitions. Data-derived insights will help banks identify specific customer needs and preferences, and by integrating technologies like CRM with customer data platforms, banks can begin to modify digital touch points in line with customer feedback.
When combined with other advanced technologies, such as artificial intelligence (AI) and machine learning (ML), these customer insights will help financial institutions create a consolidated, 360-degree view of the customer. This level of sophisticated customer intelligence allows banks to provide consistent, tailor-made customer experiences.
The resultant ability to understand the customer will empower banks to better anticipate their needs and intent to deliver personalised and relevant services and products at scale across all channels, and at the right time in the customer journey.
These personalised end-to-end interactions can help to create an emotional connection and deepen the customer experience. And creating an emotional connection with customers can help a bank outperform its competitors by 85%, according to a recent Gallup poll.
These capabilities also deliver financial benefits by reducing costs and generating additional revenue through increased product purchases and usage. According to Gallup, the financial services industry can expect a 50% increase in revenue from engaged customers, 34% higher profitability and 55% higher share of wallet.
Yet many banks struggle to integrate systems, platforms and data due to legacy on-premises systems that create information and operational silos within the organisation. For these financial services providers, cloud migration holds to the key to unlocking customer experience capabilities that modern, digitally savvy customers demand.
Financial service organisations that embrace the cloud will radically simplify their digital transformation efforts to ultimately deliver superior customer experience outcomes.
Once in the cloud, systems integration becomes achievable, which is particularly relevant in light of the growing trend towards open banking. Leveraging open banking technology can transform multiple services along the customer journey, such as broadening access to products and services, streamlining the onboarding process, and providing faster, more accurate decisioning around credit card and loan approvals, as examples.
The cloud also helps financial services providers bring data together through data decisioning platforms. Sharing this unified data via dashboards allows contact centre agents to understand the customer’s unique needs and wants, which enhances relationship management and delivers superior customer interactions that foster loyalty.
The cloud environment also lends itself to mobile integration and provides contact centres with the ability to support digital, voice and video channels to meet evolving customer engagement preferences and provide a seamless, frictionless omnichannel customer experience.
Ultimately, crafting the customer journey from the customer's standpoint, financial services providers can organise themselves and align employees around customer needs to consistently deliver value to customers and create a frictionless and unified experience across channels for seamless integration across their digital and non-digital journeys.
However, financial services providers will need to work with trusted cloud technology partners to create this unified digital ecosystem that successfully integrates all channels and delivers banking services alongside lifestyle apps for truly innovative next-generation banking.