Banking isn’t what it used to be. While the general premise hasn’t changed much over time, the ways people manage their money are changing with the times. Digital, for example, is becoming a major avenue for many, and a significant portion of Americans actually prefer to handle their banking away from branches and tellers, according to Nielsen research. In fact, people who bank away from physical branches make up a significant portion of the “Connected” segment of the population and prefer to handle their finances via mobile devices or call centers.
Financial institutions are faced with a strategic dilemma: how to manage the polarity of customer needs without alienating one group or the other.
Financial institutions are facing extreme polarity in the financial needs and wants of the baby boomers, on one side of the spectrum, and the millennials on the other. The shift in demographics and advances in technology are forcing financial institutions to make difficult strategic decisions on product and services moving forward.
Criticizing Voice of the Customer (VOC) programs is like speaking out against motherhood and apple pie. The last time I criticized VOC programs, someone left a comment chastising me for presuming that a bank could know what its customers wanted without asking them.
Well, excuse me!
But there are (at least) two problems with the “voice of the customer” that many marketers don’t take into consideration:
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.
While all businesses would likely consider customer satisfaction a ‘nice to have’, many question whether investments towards improving the customer experience will actually result in a positive impact on the bottom-line. Across multiple industries, analysis of consumer data collected by J.D. Power shows a clear relationship between high customer satisfaction and improved financial indicators.
After a period of relative stability, the primary bank switching rate jumped by more than 40 percent in late 2013, with 60 percent of smartphone/tablet users reporting mobile banking capabilities as being either “important” or “extremely important” in their decision to Switch.
I really enjoyed the presentations in Oslo, particularly the case studies by Nordea and ValYou.
Nordea spoke about their experiences with social media usage. This, in itself, is fascinating as just a few years ago no bank spoke about social media in finance. Now, I am building case studies about how banks see this as both a customer service channel, and a platform for full deposit account usage (mBank and ICICI).
But there is still quite a spectrum of banking from those who ban the use of social media in the office ot those who embrace it for communications.