Most banks and financial institutions have realized the cost reduction benefits of digital transformation. But for 2018, new technologies must go beyond achieving greater efficiencies and focus instead on creating more authentic customer engagement. That’s the consensus of over 100 global financial services leaders, who were asked by The Financial Brand for their thoughts on 2018 trends and predictions for the industry .
From a digital transformation perspective, banks and credit unions have gotten rid of the low hanging fruit through process automation, building a robust online presence and other digital initiatives designed to lower operating costs and boost efficiencies. Now they must create a different kind of engagement with customers at every touchpoint. As Accenture executive Ambrogio Terrizzano emphasizes, “the final goal (is) to create a deep and durable alignment with the human side of their customers — moving from ‘customer experience’ to ‘human experience.’”
The transition to this more human-centered approach to customer experience is challenging but not impossible. The nimble banks and credit unions who respond to this challenge will be rewarded. Those that don’t face an uphill battle for relevance.
The End of Plain Vanilla Banking
Two dynamics are steering this customer experience pivot. The first is brand blandness. In the iconic Road Runner/Coyote cartoons, the endless contraptions brandished by the hapless Coyote to do in the ever-elusive Road Runner all came from the generically labeled Acme. Many consumers see banks in the same Acme fashion. As cited in the Financial Brand story, 30 percent of all customers say ‘all banks are basically the same.’ Banks and credit unions are moving much too slowly to shed their plain vanilla brand identities and must quickly learn to differentiate themselves.
Fintech Solutions Pose Existential Threat
The other factor driving change is a more existential threat: fintech. According to research from global design firm Beyond , consumers are as interested in financial products and services from tech brands as they are from banks.
Max Levchin’s Affirm is just one example of a fintech solution upending the banking industry. A member of the self-proclaimed PayPal Mafia, Levchin’s company allows consumers to purchase online using a line of credit rather than a credit card. To change consumer credit, the company, whose loan portfolio has already reached $1 billion, begins by changing the customer conversation about loan terms. Instead of keeping the fine print fine, Affirm clearly states the terms of the loan in simple, user-tested language and design. “What people really want is to understand that they are being honestly dealt with and that they know what the true cost [of the loan] will be,” says Levchin.
To Make a Customer Happy is not a Software Problem
Re-defining a great customer experience takes the right technology and the right culture. Yes, big data and advanced analytics stand behind the personalization promise of the human-centered customer experience. But as futurist Gerd Leonhard maintains, “to make a customer happy is not a software problem.”
It’s important to empower employees with the power and responsibility to resolve customer problems, and create the “Moments of Wow” that build brand adherence. In a recent customer experience survey to uncover such moments, one bank was singled out for its deft mix of technology and culture:“Tweeting to my bank on a Sunday morning about a password/security issue. They responded within 20 minutes.”
Technology that Enhances Customer Experience
The essence of a great customer experience is whatever the customer thinks it is. Whatever can be done to make the customer be known, to be engaged and to convey true empathy throughout every customer encounter is — you’ll have to excuse us — money in the bank for financial institutions.
Join the hundreds of other banks and credit unions who have already found the right technology to help build a more human-centered approach to customer experience. Get started with 360 View.