Today’s banking and credit union customer is hyper-connected, highly informed and demanding a highly personalized approach with regards to communication, product development and customer service. These customers cannot be defined by a specific age or income category or geographic parameter, but by their ability (and desire) to adopt and apply new technologies to meet their banking needs.
Say “Hello” to Customer 3.0.
Once banks crack the code on how to deliver a better experience to customers, they will position themselves to seize phenomenal opportunities to engage with customers.
As banks look for new revenue opportunities, they have to focus on existing customers because new ones are hard to come by. But even trying to increase business with the existing base is a big challenge because banks have made interaction with customers too complicated and frustrating.
A few months ago I wrote a blog article comparing the travails of banks today to the challenges faced by the late and little-mourned Blockbuster Video chain.
I’ve had a chance to sleep on this piece and I’ve decided a better comparison might be around the US higher education Business.
To compete effectively in the Age of the Customer —a 20-year business cycle in which consumers have unprecedented real-time access to information and social sharing— it’s time for a new playbook. By using effective strategies to identify sources of dissatisfaction early on, and communicating how and when it matters most, your company can turn disgruntled customers into loyal advocates of your brand.
Consider these proven strategies for resolving pain Points:
Sixxtep Analytics wrote in a blog post titled Irrational banking customer (hat tip to @BankInnovation):
“One of the hard set, and many times hidden premise of customer analytics is that customers are rational. Well, they are not, and it is especially tangible in banking customer analysis. There are many underpinning data to this, yet data scientist still tend to believe that customers are making decision based on math. KYC – know your customer, and realize that majority of them are irrational.
We have done a small study with one of our client in banking, we tried to 1) segment and 2) scale the irrationality of the customers. Part of the job was to test their belief about their banking usage and reality, looking at the results, we were somewhat surprised to learn the incredible hiatus between their memories and reality: 1) Majority of the customers recalled their general ATM-usage wrong; 2) Vast majority of the customers had not even a general idea about the fees applicable to wire transfer; 3) A large part of the customers has not chosen the optimal package for them.”
My take: These assumptions, and the study’s findings, underscore the confusion that many marketers have regarding the concepts of rational/irrational and logical/emotional decision making.
Over the past decade, the lens through which customers view their bank and through which banks view their customers has shifted considerably. What once was a channel-dominant view of the customer (“Suzie uses the branch most often, so let’s make sure her branch experience is stellar.”) shifted to a more complex multichannel view (“Suzie interacts with us across many channels, how can we make the various experiences seamless?”), and then to the current focus on enabling a true omnichannel experience (“We need to engage Suzie positively wherever she is, whenever that is, by whatever communication methods she is using.”).
As I finished registering for ICICI’s latest Facebook app, known as Pockets, I felt that I always wanted such a feature. Pockets allows an individual to transfer money to Facebook friends without knowing their account details. This also obviates the need to log on to a banking website. Even though this was a new innovation, I could not help but feel that it was long awaited.
Internet and tech toys have completely transformed the game plan for several industries. For example, books are not only published as e-books but also come in tablet-supported formats for easier reading. Online registration of travel and hotel tickets has posed a threat to the business of travel agents. And there is no end to the list of consumer products that can be bought online. Amidst such fast-paced evolution, the banking industry seems to have fallen behind. Of course, channels like e-banking
and mobile have simplified banking, but there is much more to be desired.