Customer needs are constantly shifting and we’re expecting more and more out of the products, services and experiences brands offer. New technologies, social media and changing demographics have all helped to fuel this. The rising expectations and related behavioral changes manifest themselves in (and are amplified by) the offerings that we see and experience from companies like Uber, Amazon and Spotify who are putting the consumer at the heart of everything they do.
Ramifications span across all elements of today’s consumer ecosystems, which means banks and other financial institutions can no longer rest on the laurels of past reputation and achievements. Though the banking industry has made some changes in the attempt to keep pace with this shifting landscape – for example, the introduction of customer-friendly mobile banking interfaces – these changes remain largely incremental, without really addressing the underlying needs of consumers.
To this point, the results of Prophet’s Brand Relevance Index™ once again highlight the failings of the financial services industry when it comes to maintaining relevance with customers. Failing to understand what customers expect out of their relationship with them and therefore missing the opportunity to proactively shape future interactions and enhance the value exchange. In order to improve customer engagement and drive relevancy, here are three fundamental principles the industry should look to consider.
3 Tips to Improve Customer Engagement in Banking
Be visible and compelling
New technologies present an opportunity to better connect with consumers. Chatbots, predictive learning, in-app assistance are the tools needed to interact with customers in a timely and personal manner. However, so far, these technologies have been rarely or poorly leveraged by banking institutions.
Take robo advisory for instance, automated to handle and maintain client portfolios, it consequently reduces the need for interaction with customers but just because some customers are now favouring a more passive investment approach doesn’t mean that they no longer want to be involved and updated. Frequent interaction, transparency and consistency is key.
Banks, therefore, must find the right channels to engage with customers on a daily or weekly basis and deliver them information that is real-time, personalised and adds value in order to create as seamless an experience as possible rather than the fragmented customer ecosystems that we experience still today. To remain relevant, banks need to take their customers on a compelling journey and engage with them beyond the necessary and standardised interactions. Understanding customer’s behaviour and priorities is key. And research shows, that customers are even willing to provide behavioural data in exchange for personalised value-adding content and information. Leverage the data that modern technology offers and generate a totally new experience for clients – take Alipay as an example.
Be pragmatic and anticipate
Consumers crave experiences that are simple and straightforward. This means that companies should be prepared, responsive and already anticipating what questions or problems customers might have – sounds obvious but it’s something that is not done well by banks today. Customers should feel like their bank is not only easy to contact, but is a partner to them and there to extend a ‘helping hand’. However, when we look at today’s typical experiences we too often see the contrary to be true.
For example, when contacting customer service one is typically prompted to enter their account information at numerous touchpoints, a time consuming, repetitive and annoying process when you just want a problem solved swiftly. When a connection is finally made, customer service representatives are not empowered or capable to solve questions that go beyond a pre-defined menu of options. Customers expect quick solutions even when it may be more problematic than initially expected. Banks should work to find solutions fast and with a healthy dose of empathy rather than placing the blame on the customer for not adhering to the banks pre-defined processes. What’s more banks are yet to clock on to the “same day response” where other industries have successfully led.
Be human and trustworthy
Banks can feel impersonal and be seen as daunting institutions. Automation and events such as the financial crisis have done nothing to help assuage this perception. This means that banks need to work harder than other industries to connect with their customers. And, though technology can be a great asset and tool to creating more (and better) consumer touchpoints, there is also the danger of eradicating any feeling of connection the customer has with a bank.
Banks need to remember that their customers still crave a connection, regardless of the seamlessness of the services offered and how well the automated interaction is managed. Research shows that even younger people consider it important to have personal advisory sessions on topics such as retirement provision from time to time. Capable and motivated employees therefore are true ambassadors of the bank and remain a key asset – in fact they are an increasingly important factor in modern banking. These brand ambassadors help bring the brand to life and provide a way for consumers to establish a real emotional connection with the brand.
In short, the challenge for banks and other financial institutions is to regain and maintain relevance in people’s lives given the shifting customer expectations. These are expectations that have been, and continue to be, set by other industries. There’s an opportunity for banks and other financial institutions to play a role in this change. However, technology should not be seen as a replacement for high quality human interaction but as a way to enhance and develop existing relationships. If no change is made we can be sure that banks and financial institutions will continue to slip into irrelevance. To remain relevant it is more essential than ever and this starts by putting the consumer at the heart of everything you do.
Learn more about improving customer engagement and staying relevant in the banking industry.